Rev Group recently released its third-quarter earnings report. In the Rev Group earnings call, President and CEO Rod Rushing said the group has a year backlog in all categories.
Rushing said Rev Group’s motorized focus has kept the manufacturer from experiencing overbuilding concerns affecting industry participants focused on towables. He said 80% of sales and 90% of earnings this year have been in motorized categories. Chip and chassis shortages prevented Rev Group from overbuilding motorhomes.
Midwest Automotive Designs’ Type B business grew at 16% for the 12-month period ending June 30. Renegade’s Type C diesel business gained 1.4 points of market share, outpacing the market by 12 percentage points, Rushing said.
“The combined unit output of these two plants improved 29% versus the third quarter of last year,” Rushing said, “demonstrating Rev Drive’s ability to impact our business and deliver bottom line results.”
Rushing said the manufacturer managed its Type A business the last two years by not adding costs to the operations. The Type B and Type C markets “have held up well” with the company flexing down on inventory to compensate.
The company has seen a slowdown in towables. Also, Rev Group announced a large Type A order cancellation.
“In our Class A business,” Chief Financial Office Mark Skonieczny said, “we had one retailer that actually canceled a significant part of their orders or put those on hold within our order book. But we saw consistent flow within our motorized units.”
Type A shipments slowed, primarily because of supply chain constraints, rework and absenteeism. Covid-related absenteeism and similar supply chain constraints resulted in lower towable and truck camper.
The company’s recreation segment had $24 million in sales, an increase of 20% over last quarter.
According to Rushing, Rev Group has dealt with an inconsistent and challenged supply chain for the past year. Delivery of OEM chassis improved in recent months, with one OEM delivering 60 more chassis per week than the second quarter of this year.
“While we have seen improvements, these improvements have proven to be temporary and material shortages have subsequently reemerged impacting our flow and throughput,” Rushing said. “Wiring harnesses, HVAC, axles, radiators and electronics have consistently been short and supplied and remain disruptive to both our starts and completions. We continue our efforts to secure volume commitments and are running processes to qualify and dual source apparent suppliers, but a consistent predictable flow of materials has not yet returned.”
