Market Reports , ,

Carl Bizon

AS THE car-makers fold their tents and leave Australia, attention is swinging to another vehicle manufacturing sector that is thriving – caravans, motorhomes and camper trailers.

Australian recreational vehicle sales are on a roll, increasing 15 per cent in the past four years on swelling domestic tourism and low-interest rates.

The RV industry is a significant contributor to the economy, both as an employer and as the catalyst for the national tourism trade and hospitality infrastructure.

But its success has bred an unexpected challenge – getting enough people to fill vacancies. The industry finds itself constantly needing more employees to keep up with demand.

Australia’s biggest RV manufacturer, Jayco, made just over 11,000 caravans, camper trailers and motorhomes in 2016 – in a total market of 21,800 units – giving it more than half the sales cake.

It employs 1100 people in a 20 hectare complex at Dandenong in Melbourne, yet at any one time, has between 40 and 70 vacancies.

“It’s constricting our growth and is one of our biggest challenges,” Jayco CEO Carl Bizon told GoAutoNews Premium.

“People see the closure of Ford, Toyota and Holden and say that’s the death of manufacturing in this country. They don’t realise that the caravan industry in Australia has more than 90 manufacturers employing over 2500 people and turning over $1 billion-plus a year.

“The death of manufacturing has been called too early and government should realise that there’s a vibrant industry that’s booming, that is employing and that has a strong history (Jayco is 42 years old) and a strong future.”

Caravan sales – Click to enlarge

Sales of RVs – including caravans, camper trailers, tent-style trailers and motor homes – continue to rise but there are some movements in the mix. There is a slight softening in the caravan sector while there is a rise in camper trailers.

Mr Bizon said this was attributed to a change in fortunes of the two main buying groups – retirees and families – where the retirees tend to buy caravans. These buyers had been affected by low interest rates on their superannuation and savings, while the same lower interest rates had made it easier for families to buy a camper trailer.

“That can affect manufacturers and dealers who concentrate on one type of RV, such as a caravan,” he said.

“Jayco is fortunate to have products in all the RV sectors and a product range from $18,000 to $90,000 so we tend to benefit from exposure to different customer needs.”

The Australian caravan industry was seen to be threatened by imported products but Mr Bizon said the Australian compliance and the currency fluctuations have made it difficult for the US and Chinese manufacturers to make a dent in the market.

“It is a substantial investment to make a caravan comply to the Australian codes and ADRs,” he said.

“It’s not just the design of the vehicle, but it’s the 240-volt system, plumbing and gas standards, compliant ovens, cookers and fridges so there are varying requirements.

“The Chinese have varying degrees of quality and have been more successful in the tent-style trailer-based units than caravans or traditional camper trailers.

“Australians have reduced their manufacture of trailer-based campers and even box trailers because of the Chinese imports that have price advantages both in manufacture and because they can be shipped in completely knocked down (CKD) form.

“There are about 5000 Chinese trailer-based units sold a year in Australia so it’s a big market for them.”

While Jayco and its peers don’t play in that segment of the market, Mr Bizon said it was still necessary to have a broad product range.

“We have recently expanded into the camper van segment with conversions of the Toyota HiAce,” he said.

“This is in addition to our C-Class motorhomes based on cab-chassis models from Mercedes-Benz, Iveco, Fiat and Renault. We build about 500 a year.”

Mr Bizon, who took over as CEO from founder and chairman Gerry Ryan in late 2015, was previously managing director of Australia’s largest towing system manufacturer TriMas Corporation.

His role with TriMas led to his induction into the Victorian Manufacturing Hall of Fame. TriMas, based in Keysborough, Victoria, is the parent company of Hayman Reese.

By Neil Dowling