The Recreation Vehicle Industry Association commissioned an Economic Impact Study on the RV industry, released on June 7, 2016. The study found that the RV industry contributes about $49.7 billion in economic output or 0.28 percent of the Gross Domestic Product. Through its production and distribution linkages, the industry impacts firms in 426 of the 440 sectors of the United States economy.
Nationwide, the industry is responsible for 216,170 jobs, both directly and inderectly, creating an economic impact of $37.5 billion. The full study results, along with each individual state and congressional district's economic impact is available on the website by clicking here .
Thu Jun 30, 2016
The oil economy has done no favors to the Canadian dollar.
Because the Canadian economy is a resources-based economy, many of the industries within the northern country have been hit as a result.
However, the Canadian dollar – sometimes called the Loonie, often has fluctuations that are truly looney.
Eleanor Hamm, the president of the Recreation Vehicle Dealers Association of Canada, says the Canadian dollar has fluctuated back and forth, up and down for so long.
In 1995, the Canadian dollar was worth about 71 United States cents. Over the next few years, it dropped to 68 cents in 2000 and its lowest point of 66 cents in 2002.
In 2004, it sprang back up to 91 cents, before dropping to 84 cents in early 2007. By late 2007, it had eclipsed the American dollar, being valued at $1.01. However, it was back at 79 cents by 2009 before climbing back up in 2010-11. Finally, in 2013, it began its most recent decline, to where it sits now at about 76 cents.
“They are forecasting us to finish around 80 cents by the end of the year,” Hamm says. “We’re a resource-based economy., so it all depends on the price of oil and how the economy is going. But we usually stabilize around 80 cents.”
The falling value of the Canadian dollar has affected the RV industry in the United States. Canada’s RV enthusiasts make up a large part of the snowbirds – the tourists who escape the blustering cold of Canada’s winters to go RVing in the warmer southwest like Arizona, southern California, southern Utah and even as far east as Florida.
Arizona Recreation Vehicle Dealer’s Association President Jack Crays says his state’s RV industry economy relies a lot on the Canadians, who come down during the winter and generally provide a strong influx of dollars into the state economy.
“About 35 percent of our business in the wintertime is Canadians,” Crays says. “And with the Canadian dollar as it is, we had a really bad January, February and March.”
Crays says that since then, the state RV economy has rebounded to have a really strong April through June, but the question of when the Canadian dollar will stabilize again is still up in the air.
Hamm says with the disparity between the two currencies, it’s harder for Canadians to make sense of traveling to the United States, which will be more expensive on several fronts.
“It (the dollar) reached a 17-month low on Friday,” Hamm says. “The pricing no longer makes sense to make coming to the U.S. that attractive. It’s 30 percent more expensive for us. Unless there’s a specific model or make that they can’t get in Canada, you’ll see the decline there.”
Spending $1 in the United States would roughly cost about $1.30 in Canadian dollars. The impacts are significant when put into the perspective of an RV. A Type A motorhome that would cost roughly $100,000 would now cost a Canadian $30,000 more to buy in the United States. The same goes for any retail parts and products.
Then comes the issue of importing the vehicle into the country. Registering the vehicle in the new country comes with both a registration fee of about $150, plus a Goods and Services Tax that can be as much as 15 percent, along with whatever provincial tax is included.
Hamm says some of the snowbirds will still go down, but it likely will not be as many or for as long, if the Loonie remains lower than normal.
“The costs are fairly similar, but when you’re adding 30 percent onto that, it does become pretty expensive,” Hamm says. “That’s one thing we saw in the housing bust in the U.S. in ’08, when housing became affordable. People who would have gone RVing purchased a house in the U.S. because it was economical.”
While it’s summer in the United States, the warmer places such as Arizona would not be getting the normal influx from the Canadians or other Americans living in colder climates. But Crays says the monthly economies are still greater than last year’s at this time.
“This year, April, May and June as it’s about to end, we’re better than last year by about 20 percent,” Crays says. “Because of the heat, it’s not booming, but the market’s been good.”
As of now, the Canadian RV dealers also are struggling with the value disparity, because most of the RV industry deals in American dollars, which are 30 percent more expensive for Canadians.
“When dealers are ordering inventory, that will affect the price, becomes it comes in U.S. dollars,” Hamm says. “Dealers in January would hold off for a little bit. Once it stabilizes, it becomes easier for people to manage. When the dollar has dropped, it makes the unit price a little more expensive this year than the year before.”
Until the Canadian dollar stabilizes back at its normal value, the RV industry in the U.S., especially in the southern states that rely on high business numbers from the Canadians, could see those numbers drop in the near future.