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 .
Mon Nov 26, 2018
Author: RV News Staff
Dometic AB’s CEO Juan Vargues plans to take the company in a new direction. In an article appearing in Bloomberg.com, Vargues laid out a strategy that includes opening a new factory in Mexico, reducing the number of plants worldwide, reducing the number of suppliers Dometic uses and other measures.
Vargues took over as CEO at the end of 2018 and has been working on a new strategic plan, which he outlined for 155 managers at a Berlin meeting last month. Dometic stock has slumped 30 percent in 2018 and the company needed a strategic overhaul. The company’s supply chain is in some difficulty due to the tariff disputes currently happening between the U.S. and China.
“We need to work with internal efficiency to be able to invest for the future,” Vargues said in an interview in Stockholm.
Key features of the new strategy include cutting dependence on makers of recreational vehicles which account for 40 percent of Dometic’s sales, outsourcing of production, developing products in closer partnership with suppliers, reducing Dometic’s current list of 3,000 suppliers to get improved terms and pricing and cutting the company’s approximately 30,000 SKUs by 30 percent by the end of 2019.
The company also plans to diversify its product offerings to cut Dometic’s current 40 percent reliance on the RV market. This part of the plan includes making acquisitions of companies in such areas as commercial vehicles and commercial shipping. They also want to ensure new products have a 20 percent lower cost than those they replace. They will also focus on making “transformational” acquisitions of companies in other businesses every 3-5 years. An example would be Dometic’s November 2017 acquisition of SeaStar Solutions, a global provider of vessel control, fuel systems and systems integration to the marine industry.
“We need to make sure to reduce the exposure further ahead of the next downturn,” Vargues says. “My customers are optimistic, but my job is to protect the company. Looking at the car industry or the housing market, there’s reason to be cautious.”
The company aims to open the Mexico plant in March and is moving some production from China to avoid new tariffs, Vargues said in an interview. The company will keep its Chinese plants busy by moving some output of goods not on the tariff list from the U.S. to China. Dometic originally planned to move some of its production from the northern U.S. to Mexico or the southern U.S., but President Trump’s tariff actions made the Mexican factory option more appealing.