Share
Preview

AUGUST 6, 2020   |   VIEW AS WEBPAGE
 
 
Presenting Sponsor
Foster Group
COVID-19 has boosted interest in RVs as buyers seek a safe way to travel.

Sales of Luxury Recreational Vehicles Surge

BY STEVE DINNEN 

Flummoxed by months of lockdown, people are itching to get out of the house, travel a bit and maybe breathe some virus-free air. They’re not especially keen on staying in hotels as they wander, which helps explain why there's a been a surge in sales of recreational vehicles -- campers that will serve as your personally cleansed lodging.


Ed Garner said he’s not seen much like this season in the 51 years that he's owned and operated Autorama RV Center on Southeast 14th Street in Des Moines. His sales in June were up about 20 percent from the previous  year. Garner stocked up on inventory during the winter, before the pandemic hit, and by now there are huge gaps in the sales lot he operates because so many trailers have been sold and he can’t get replacement units from manufacturers.

A recent Saturday "was our busiest day in years,” Garner said of crowds that poked around the lot -- a former drive-in theater -- looking for tow-behind trailers, or fifth-wheel trailers that attach themselves to hitches in the beds of pickup trucks. Like other RV dealers, Autorama also sells motor homes, which are either campers that are plopped onto a chassis and cab/engine built by auto manufacturers, or purpose-built motor coaches that are like plushed-out intercity buses complete with living rooms, dining areas, showers and pull-out sofas.

Historically, RV buyers are older couples, often nearing retirement. They want to grab an RV so they can tour the country during their golden years. But this year, at least, Ed Garner and Debbie Garner, his wife and the general manager of the business, said they’re seeing a lot of younger buyers, people with kids to haul along for the ride.

“It’s a way of taking a family vacation,” said Debbie Garner. That means campers with bunk beds have been in demand, as it lets the owner tuck an extra body or two into their home on wheels.

The Garners said current buyers are for the most part first-timers. But Ed said they also seem to have done their homework and show up with papers in hand, indicating they’ve done online research about specifications of campers.

Campers are surprisingly affordable, with entry-level, tow-behind models starting for under $20,000. You can add as many bells and whistles as you wish, however, and the more luxurious motor coaches run $60,000 and up for the smaller units to $200,000 to $1 million for top-of-the-line models. If you don’t have that much cash laying around, no problem; Garner said most motor homes qualify for financing of up to 15-year terms. He estimated that 75 percent of campers sold are financed.

dsm Magazine dsm Magazine
Legacy Bridge
Winnebago's Stock Soars With Increased RV Demand

BY STEVE DINNEN 


In the stock market rout of February and March, few public companies fell as hard as Winnebago Industries Inc. Thankfully, there has been a rebound, with even fewer companies bouncing back as sharply as the Forest City, Iowa-based maker of recreational vehicles. Credit lies largely with Americans who have decided they want to get out of the house and travel during the pandemic, yet sort of stay in a house, or at least something they can spray with Lysol at their leisure.

On Feb. 12 when the Dow Jones Industrial Average hit its 2020 high, Winnebago was riding pretty high as well--$60.84 to be exact. But then the market began a spectacularly steep decline, and by March 23, the Dow was off 31 percent. Winnebago easily topped that, falling 72 percent before closing the day a shade higher, at $21.86.

The RV makers are tied to the overall ups and downs of the economy, so you might think Winnebago would still be reeling, given the record second quarter fall in GDP. Not so. It just closed at $60.41, or 356 percent higher than the $16.94 it sank to back in March.

RV makers can’t get enough inventory to meet current demand. When they do, it could mean even fatter days ahead for Winnebago. “Prices won’t be the same,” said Ed Garner, owner of Autorama RV Center in Des Moines, predicting a 15 to18 percent bump.

dsm Magazine dsm Magazine
ADVERTISEMENT
Founder’s Legacy
Ensuring a founder’s values remain a part of the modern culture challenges leaders to inspire success and enable great things in the people around them. ... Read more »
Price of Gold Rallies Past $2,000 an Ounce
BY JULIA HOROWITZ FOR CNN BUSINESS

Powered by a dominant tech sector, stocks keep rising. But if gold prices are any indication, traders are still hedging their bets against an uncertain economic future.

What's happening: Gold has rallied past $2,000 per ounce for the first time ever, with spot prices jumping as high as $2,041 per ounce last Wednesday.

The metal's spectacular rally is the result of a weakening dollar, which makes it cheaper for foreign investors to buy gold, as well as rock-bottom yields on other safe-haven assets like US Treasuries. Some investors also fear that trillions in unprecedented stimulus from central banks could feed long-dormant inflationary pressures, and are turning to gold for protection.

The gold rush has notable consequences. SPDR Gold Shares (GLD), an exchange-traded fund that holds physical gold in HSBC's London vaults, has had to stockpile huge amounts in recent days as investors piled in. >> READ MORE
Is Buying a Beach House a Good Idea?

BY GREG DEPERSIO FOR INVESTOPEDIA

Buying a beach house can bring an excellent return on investment, a reliable income stream, and access to a delightful vacation spot. Many beach-house investors purchase homes that they subsequently rent out during peak tourism times. A beach house owner in Florida might make the house available to rent from November through April when residents of colder states crave sunshine and warmer temperatures.

Many beach house investors claim that their rental income for the colder half of the year covers their expenses for the entire year. That effectively lets them live in the house for free during the non-peak season.

Before taking the beach house plunge, it is essential to understand the underlying economics involved. Drawbacks include high borrowing costs, exorbitant insurance rates, and copious bills, plus the general headaches of property management.
>>READ MORE

dsmWealth's Suggested Reading

dsmWealth is published on the first and third Thursday of each month and updated on dsmMagazine.com.

What would you like to see here? Contact us at
dsmwealtheditor@bpcdm.com.

You can
sign up here to get dsmWealth delivered to your inbox.
 


 
Business Publications Corporation Inc.

Advertising info: rachellekjellberg@bpcdm.com
Business Record membership info: jasonswanson@bpcdm.com


Copyright © BPC 2020, All rights reserved.
Reproduction or use without permission of editorial or graphic content in any manner is strictly prohibited.

Email Marketing by ActiveCampaign