RV sales pointing to a recovery Industry has been a leading indicator

12/27/2009

CHICAGO -- Before housing hit the skids, credit got crunched and the unemployment rate shot into double digits, the market for recreational vehicles started to plummet.

Economists view RVs as an early indicator of where the economy is going, and as it turned out, the rest of the planet followed motor homes and travel trailers right over the edge.

Now comes word that RV sales have started picking up. Airstream Inc. is boosting production of its iconic caravans and expanding its work force by 50 percent.

"Airstream is back on the road to recovery," CEO Bob Wheeler said. "We can expect to see significant growth."

As decades go, the 2000s ended with such a bust that the 2010s almost can't help but look good in comparison.

With the economy lurching from housing crisis to credit crisis to its ongoing job crisis, it might seem premature to declare a recovery in the offing. Yet most forecasters expect at least some growth ahead. And by a few measures, the good times already have started rolling again.

Just look at a chart of stock-market performance since the bottom in March: Megabucks are being made, and, no matter how hard a sheepish Wall Street tries to hide it, bonuses will be enormous.

Conventional wisdom holds that the rich will get richer -- surprise! -- and everybody else in a winner-take-all economy will be downwardly mobile.

But if the assembly workers at Midwest RV plants can stage an unlikely comeback, anybody can. It's just going to take time.

In fact, some of the most optimistic economic experts expect only a slow turnaround in the job market. James Smith, chief economist at Parsec Financial Management Inc., predicted at the low point last winter that the recession would be over as of May 15, a prediction that could turn out exactly on target in the final analysis.

Yet, Smith also thinks the U.S. economy will be "really lucky," he said, if it can create enough jobs by the middle of 2013 to equal the level of December 2007.

In other words, catching up will take five and a half years.

"When you lose 7 million-plus jobs, it takes a long time," Smith said. Any economist who expects much better would have to be "a raving maniac," he said.

In the RV business, shipments are expected to make a strong comeback in 2010 from the left-for-dead levels of 2009, but a lot has changed, Airstream's Wheeler said.

Less-expensive, towable RVs will sell better than motor homes, and the top-of-the-line, gas-guzzling buses mostly will sit idle, he said. "There's been a cultural shift away from conspicuous consumption."

Business in the 2010s might never match the boom times of 2005-06, or plunge again to the depths of the current bust. A less-volatile decade might not exactly feel like a smooth ride, Wheeler said, but at least the nation should encounter "much gentler ups and downs."