The COVID-19 pandemic has caused supply and manufacturing disruptions in the automotive sector creating uncertainties in every aspect. The change in customer behavior in terms of mobility preferences during this crisis is changing the automotive landscape.
This pandemic situation has shut down many production lines owing to the trade restrictions and closed borders, creating a shortage in required parts and limiting the distribution of supplies. Different enforced measures including the closing of workspaces and dismissal of short-time workers have created a depression in the growth rate of the automotive industry.
The growing fear of recession is estimated to decrease overall sales and revenue. A limited supply of parts coupled with a reduced workforce has forced the leading OEMs to shut down their production. A significant drop in demand has restricted the cash inflow which is highly important in payment of salaries to the workforce. With growing uncertainties around the COVID-19 pandemic, the industry leaders are taking measures to adapt to the situation.
North America sales of recreational vehicle are projected to reach US$ 26.19 Bn by 2024 end, expanding at a CAGR of over 7%. In terms of consumption volume, recreational vehicles will possibly exceed 465,000 units within the first half of the assessed period i.e. by 2020 end.
In a recently published market outlook titled “Recreational Vehicle Market: North America Industry Analysis and Forecast 2016 to 2024,” Persistence Market Research delivers key insights into the critical factors expected to impact the market growth over the next few years. The report also provides country-wise and segmental analysis estimated for an eight-year forecast period, 2016-2024.
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“Revenue sales of recreational vehicle across North America will be highly impacted by demographics, consumer behavior, and purchasing power. Eco-friendly and lightweight recreational vehicle highlight a current growing trend, whereas hybrid/battery-operated recreational vehicles have recently emerged as a promising trend. Rental market for recreational vehicle is witnessing significant growth. Growing preference for online shopping will also benefit RV promotion and sales,” Persistence Market Research comments on the most influential trends in North America’s recreational vehicle market.
Drivers, Trends, and Opportunity Insights
Rising consumer inclination toward entertaining outdoors and adventure travel will remain the key drivers to North America market for recreational vehicles. Recent style and design innovations fuel the market growth further.
Developing outdoor recreational infrastructure and growing preference for sustainable tourism against mass tourism will collectively create revenue generation channels for RV manufacturers.
Baby Boomers have always been the largest consumer cluster for recreational vehicle. However, several manufacturers are increasingly targeting young consumers through emphasis on new, cost-effective product launches based on advanced technology. Thor Industries recently (2016) introduced smaller Class C and Class A motorhomes, specifically targeting younger generation consumers.
Country-wise Market Insights
U.S. based manufactures are likely to encounter with attractive opportunities in developing Asian countries, including Japan, China, and South Korea. For existing network expansion, various small manufacturers are consolidating with established players. Vendors are also offering multiple financing options on RV purchase.
A few more factors that will continue to favor the growth of recreational vehicle market include initiatives by governments. States’ rising investments in specialized roadways specifically designed for recreational vehicle prompt at lucrative opportunities in near future.
Geographical analysis of North America recreational vehicle market bifurcates the market into the U.S. and Canada. While the U.S. is anticipated to take a leap over US$ 22 Bn by 2024 end, Canada market will possibly represent a total incremental opportunity of US$ 1,552.2 Mn between 2016 and 2024.
U.S. currently accounts for over 87% share of the North American market; however, Canada is identified to be a growing market driven by relatively higher growth opportunities.
By exterior construction material, North America’s recreational vehicle market is classified as –
Aluminum segment, with roughly 40% value share, currently leads the market. Persistence Market Research expected this segment to surpass US$ 10 Bn in 2024, closely followed by fiberglass. The latter is likely to demonstrate the highest growth at a CAGR of over 9%, gaining around 320 BPS over the next eight years. This growth is due to surging demand for eco-friendly, lightweight vehicles.
By type, the recreational vehicle market in North America is segmented into –
- Class A Motor Homes
- Class B Motor Homes
- Class C Motor Homes
- Travel Trailer & Campers
- Conventional Travel Trailers
- Fifth-wheel Travel Trailer
- Camping Trailers
- Folding Camping Trailer
- Truck Camper
Although large motorhomes, especially those equipped with solar and wireless technologies are experiencing higher traction, travel trailers and campers will remain dominant throughout the forecast period. Travel trailers and campers segment currently holds a dominant share of nearly 61%, followed by motor homes segment with around 37% share of the entire market revenues. Over the forecast period, travel trailers and campers segment will reach US$ 14.59 Bn gaining around 570 BPS.
Class A and class B motorhome segments reflect higher growth potential, attributed to affordability and user-friendliness. Class A vehicle will continue to represent the largest motorhomes sub-segment, followed by class C. Whereas, motor homes segment will witness the fastest growth at over 9% CAGR over 2016-2024.
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