GE Capital Provides Outlook on Canadian RV, Motorsports, Marine
GE Capital, Commercial Distribution Finance (CDF) has released its outlook for the Canadian recreational vehicle (RV), motorsports and marine industries. In general, each is performing well, with volume growth and relatively healthy inventory turns, in spite of some regional variations.
CDF provides inventory financing, also known as floorplan financing, that allows dealers to stock, market and sell a wide variety of products from manufacturers, including those in the RV, motorsports and marine industries. It’s an important element of a successful manufacturer-dealer business model.
As a result of its longstanding position as the leading financing provider to Canadian manufacturers and distributors and their dealers, CDF periodically provides market intelligence that may help companies throughout the supply chains to manage their businesses.
The outlook for the Canadian RV industry is positive in light of solid overall unit sales, respectable inventory turns and the continuing strength of the national economy.
“There has been a positive increase in orders by Canadian RV dealers,” said Howard Shiebler, president and CEO of CDF in Canada. “Another encouraging and related health barometer for the industry is that the national level of dealer inventory aged over one year is just 16%.”
CDF has released an audiocast, titled “Performance of the RV Industry in Canada,” that features a discussion between CDF’s Shiebler and Garth Bromley, chairman of the Recreational Vehicle Dealers Association (RVDA) of Canada. They discuss their optimistic outlook for the RV industry and factors impacting the market, including the health of the Canadian economy, regulatory issues and RV imports.
In the motorsports industry, dealers have stocked conservatively and aging overall is healthy at 12%. However, British Columbia, Alberta and the Maritimes are still holding extra inventory from snow-related products that didn’t sell over the winter.
“Across the country, motorsports dealers have been very thoughtful in their ordering patterns, probably due to concerns about consumer debt levels and the overall economic environment,” Shiebler said. “Nevertheless, household debt levels are reasonable and our view of the motorsports industry remains positive.”
Wholesale shipments through the end of May increased by double digits compared to the same period in 2011, driven largely by the West. Reflecting these higher order levels, the overall inventory of aluminum and fiberglass units has reached three-year highs. And, while inventory-aging levels are starting to increase across the country, they’re still within an acceptable range.
“We know that dealers practice a delicate balancing act when it comes to stocking levels,” Shiebler said. “We work with manufacturers and their dealer customers to help them make the most of Canada’s short selling season to ensure that they have enough credit capacity to have the right product mix on hand. And of course we’ll continue to share performance benchmarks and strategies on budget management to help dealers across the country be as productive as possible.”