RVBusiness, September/October 2019

Louisville was fading I think it would have helped if they had bolted on to the Louisville Show elements of what we saw at RVX If they had I dont think it would have died What happened was that it kind of used the same format forever and it just kept fading Even the last Louisville its like they RVIA upped their game but it was too late Gaeddert Do we need another event You know there were bits and pieces out of RVX that were good but it was destined to fail from the outset based on its March time frame How it all ends up I dont know but if we look at another event timing has got to be critical because the kickoff to retail starts the very first weekend in January with retail show season So Louisville was great timing It might not have met peoples personal schedules because of Thanksgiving and so on but at the end of the day the timing was perfect to kick off and market new RV products RVB What else should we know then about this years Elkhart RV Open House Brent Stevens What XLR has been doing in the runup to the Expo with the slow downturn that weve had call it a rebalancing is really focusing on our quality aspect providing dealers a better quality product and doing a better job from our service side Weve always focused on service but I would say that that the downturn has allowed us to elevate our game And at XLR were also doing a rebranding of our product a complete overhaul including new logos and terminology as we take toy haulers to a new level The toy hauler buyer we feel is an action camper which is one of our new terms thats going to be utilized with all of our brands moving forward Gaeddert One of the things I think we should all keep in mind regarding this years Expo is some simple economics and the fact that the retail business is damn good out there Yes were looking at a correction and I think those lines have crossed And as we look at this rebalancing I foresee some dealers 106 RVBusiness S E P T E M B E R O C T O B E R 2 0 1 9 coming in light with inventories in line or even lower than what they should be this fall because theres been an overcorrection Based on previous output levels as an industry many of those dealers may be assuming that were going to be able to quickly supply them with product come January February or maybe March And unfortunately they could get caught without adequate inventory for the spring selling season What a lot of people dont realize is that the industry is in great shape From a manufacturing standpoint weve corrected our output levels But the dealers need to be careful because its not a situation where you can simply flip a switch and go back to the levels that we once had So some dealers are likely to get caught off guard RVB So you as a manufacturer are anticipating ramping back up Gaeddert Yes its a challenge especially in maintaining quality levels And when you try and ramp up a facility overnight in the spring quality is not going to be as good as what it would be if there was more consistent yearround production I think people have also learned that painful lesson over the years So what were really doing is experiencing a new normal Were producing really close to the same total rates that we had last year said John Quake Itll be far more level than it was because were smarter as an industry than we used to be when it comes to these cycles And again retail is damn good off no more than 68 relative to last year Wholesale shipments are off a little over 20 and I can tell you as a group that were probably going to end up about 3 less in dollars than where we finished up last year Now I do think a big reason is that weve managed our capacities real tight and weve stayed real disciplined on the assumption that theres going to be a new normal that will factor in the ability to modify production levels throughout the year Quake For years we have not been able to meet the demand March through June I dont think anybody in this room has and thats with dealers taking product after the Open House in November and December I mean were usually running pretty much full capacity at that time But weve never been able to meet that demand during that spring time frame And again were producing really close to the same total rates that we had last year I look at it every day I get a daily production report I compare it to the prior year and instead of what you can build all year long there are going to be a few more little peaks and valleys to it Itll be far more level than it was once upon a time because were smarter as an industry than we used to be RVB Any other news we ought to be aware of regarding your division Gaeddert Yes we just got an occupancy permit for a brand new 100000 square foot Riverstone plant that we are completing in Topeka that will be dedicated solely to Riverstone So well be moving our Vengeance line of laminated toy hauler fifth wheels into the plant that Riverstone is moving out of As for the market I should add I think weve got a good chance of finishing out this year as a group up slightly every month probably winding up just under 80000 units but again nothing significant in terms of our overall performance Id say were probably going to end up off about 5 behind 2018 The crystal ball isnt great but were lean and mean In fact at the end of last month we were within probably 50 units of where we were at the same time last year RVB At XLR were doing a complete rebranding of our product a complete overhaul pointed out Brent Stevens