Industry analyst Dr. Richard Curtin continues to see bright prospects for RV wholesale shipments into 2019, despite his projection for a possible “short, shallow recession” sometime in the fourth quarter of that year, or possibly early 2020.
Curtin, chief economist for the University of Michigan’s Surveys of Consumers and a longtime tracker of RV shipments for the RV Industry Association, shared his thoughts on the health of the market with members of RVIA’s Market Committee during Committee Week in Washington, D.C., earlier this month.
Curtin forecasts shipments will reach 539,900 units this year and 550,200 in 2019 – which would be the highest number in a half-century. (In 1972, shipments totaled 582,000.)
Positive driving factors include continued favorable demographics, historically low unemployment levels, and tax cuts passed the Republican-controlled Congress in late 2017, which Curtin said are generally popular with the public, particularly small business owners. Additionally, government spending at the federal level should spur the economy on, he added.
Meanwhile, even though interest rates and inflation rates are trending up slightly, those don’t appear to be detrimental to market outlook at this time, according to Curtin.
On the negative side, spending on research and development is not what it should be, home values (which create a “wealth effect” for consumers) are slowing down and “persistent uncertainty” from the U.S. Administration has created a degree of uncertainty in the business community, according to Curtin. Thus far, positive economic developments have outweighed those negatives, he added.
Meanwhile, Curtin said he does not believe the U.S. will engage in an all-out trade war with China, Europe and other countries, but that “tense negotiations” are likely. Still, even increased talk of tariffs and a trade war risks dimming the consumer outlook, he warned.
For the longer-term, Curtin said he remains optimistic on the industry’s ability to grow. Industry shipments and sales topping 700,000 units is “completely do-able” – provided consumers see the value in RVing and don’t drop out of the market, he said, adding that it is contingent upon the industry to make consumers remain engaged in the market.