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Crowe Capital Markets LLC is a Chicago-based boutique investment bank and an affiliate of Crowe, Chizek and Company LLP, one of the top 10 public accounting and consulting firms in the United States.

"Recreational vehicle shipments and revenues are soaring, valuations are at historical highs, and many RV participants are aggressively pursuing their plans for expansion and growth," said Mike McCoy, managing director at Crowe Capital. "Currently, participants in the recreational vehicle industry face an unprecedented opportunity to capitalize on this growth and to maximize shareholder value. This study presented Crowe Capital with the opportunity to address a historically underserved industry with sophisticated financial analysis and support."

The inaugural study highlights four important factors:

* Large and Rapidly Growing Market - After declines in shipments and total retail value in 2000 and 2001, the $8.6 billion RV market began to recover in 2002. This is a trend that Crowe Capital expects to continue in 2003, as positive underlying economic fundamentals and increased end-user demand fuel accelerated growth.

* Continued Industry Rebound - A market rebound already is underway in the industry, with publicly traded RV equities outperforming the S&P Index by a margin of 92 percent over the past two years. This rebound is expected to continue into 2003.

* Favorable Demographic Trends - As baby boomers continue to age, the RV industry stands to experience significant future growth through increased spending on the RV lifestyle. With increasing amounts of disposable income and free time, this segment of the population - generally referred to as Americans born between 1946 and 1964 - represents the highest RV ownership rate of any population group (13.7 percent of vehicle owning households). Crowe Capital views this trend as the key long-term growth factor for the RV industry.

* Continued Consolidation - The past 10 years have seen a wave of consolidation within the industry. The Crowe Capital study expects trends in the RV industry to mirror those in the auto industry, with larger manufacturers continuing to garner increased market share through internal expansion and acquisition. 

Additional research findings include: 

RV Market Segmentation

* The RV market can be segmented into two main categories: motorhomes (RVs built on a motor vehicle chassis) and towables (designed to be towed by a motor vehicle). Motorhome sales generated $5.3 billion, or 61.6 percent, of the total RV market in 2001, with towable sales generating the remaining $3.3 billion.

* Within the motorhome category, the majority of shipments were Class A motorhomes, accounting for 67.9 percent of the segment total. Class A motorhomes are the largest and most luxurious of the three motorhome classes, selling for an average retail price of $130,000.

* Among motorhome and towable segments, the trend favors higher-end RVs. For example, the Class A motorhomes segment share increased from 56.0 percent in 1991 to 67.9 percent in 2002. In the towable category, the combined share of higher-priced travel trailers and fifth-wheel trailers increased from 64.0 percent of shipments to 75.5 percent since 1991. These trends suggest a significant amount of "trading up" on the part of RV consumers. 

Growth Drivers

* Low interest rates and gas prices have played a major role in the recent success in the RV industry, stimulating RV purchases by minimizing the cost of financing a vehicle and encouraging consumers to buy in anticipation of lower travelrelated expenses.

* Many Americans are turning to RV travel as a lower cost alternative to other vacation types. A recent survey suggests that a family of four can save between 29 percent and 80 percent on average on a weeklong vacation when traveling by RV.

* RV industry awareness has increased substantially over the past decade, largely as a result of industry efforts to promote the RV experience to the broader public. The most significant effort came from the "Go RVing" campaign, a $40 million television, Internet and magazine advertising effort that ran from January 2000 through September 2002. 

* Safety is of primary importance to travelers in the wake of the Sept. 11, 2001, tragedies. Many travelers have placed an increased emphasis on travel safety, electing road travel over flying.

Price Movements

* Average prices for purchased RVs have risen over the past decade, most notably in the motorhome category. The average price of a motorhome increased from $51,200 in 1991 to $106,800 in 2002, representing an annual growth rate of more than 7.6 percent.