The Federal Reserve's aggressive reduction in interest rates this year, coupled with retroactive tax relief, has laid the foundation for improved consumer demand this year. Retail sales of recreation vehicles have apparently benefited from these actions but the Recreation Vehicle Industry Association (RVIA) reports that wholesale shipments continue to lag. Shipments of all RVs totaled 23,800 units in May, off 17.6% from this same month last year. Importantly, wholesale shipments, adjusted for seasonal variations, improved 6% over last month to more than 260,000 units on an annualized basis. Year to date, totals have now climbed to 116,300 units through May of this year, representing an annualized pace of more than 250,000 units per year.

The Index of Consumer Sentiment was 92.0 in the May 2001 survey as conducted by the University of Michigan's Survey Research Center, up from 88.4 in April. Lower interest rates and higher stock prices have, at least temporally, stemmed the recent sharp declines in consumer confidence.

"Interestingly, the announced increase in unemployment rate had no immediate impact on consumers," reported Dr. Richard Curtin, director of the survey. "Still, concerns about energy prices and job prospects will dictate the direction of future prospects."

Towable RVs

Total shipments of all towable RVs were 19,300 units in May, off 18.6% from this same month one year ago. Year-to-date totals for all towable RVs were at 94,600 units, down 19.3% over this same period last year.

Each vehicle category in this group was lower this May than last. Conventional travel trailers, particularly larger units with slideouts, did quite well in May while smaller trailers without slideouts slipped lower.

Motorhomes

Wholesale shipments of all motorhomes totaled 4,500 units in May, off 6.5% from the prior month and down 13.5% from this same month one year ago. May shipments of 2,700 units of type A motorhomes were the lowest May total for these products in 6 years. Diesel type A shipments held up well as the decline hit gasoline products the hardest.

Through May, all motorhome shipments are now at 21,700 units, off 28.1% from last year through the first five months.

Conversion Vehicles

Conversion vehicle shipments improved some in May, rising to 6,200 units, up 5% over the previous month, but still down 47% from this same month last year. Improvements in all three categories were registered in May with vans representing two-thirds of all conversions.