TAMPA, Fla. — One of the biggest challenges facing the Australian RV industry is attempting to unify the diverse agendas of various stakeholders, Stuart Lamont told participants at the Second Annual World RV Conference last week.
The conference attracted 240 industry leaders from 16 countries with established or emerging RV industries. Held at the Marriott Waterside resort in Tampa, Fla., it was sponsored by the RV Industry Association.
As the CEO of the Carvan, RV and Accommodation Industry of Australia, Lamont said such unification is necessary. ”We have a very diverse stakeholder group and it is very important that we unite everyone because the world is getting smaller and what happens overseas may impact Australia tomorrow,” he explained.
Harmonization would also help the industry better track RV registrations because not all units are accurately accounted for by each of the states. It would also help in the area of licensing repair centers because current laws in some states requiring qualified electricians and plumbers to only work on repairs; whereas, other states do have some restricted licencing allowing technicians to work only on RV products.
Of the 22.8 million people living in Australia, 5 million were born outside the country. The country measures 2,700 miles in length and 1,875 miles in width, and would fit within the borders of the United States. A trip around the entire circumference of the nation takes only 9,000 miles. It is divided into eight different states and territories that have a healthy rivalry.
Nearly everyone in Australia has been RVing. There are 474,000 registered RVs in the country, and 85 percent of all people have enjoyed at least one caravanning or camping holiday, said Lamont. However, the ability of people to travel in RVs is complicated, he explained, because a huge section of the country has no infrastructure, like roads or campgrounds, yet it’s beauty makes it a popular attraction, said Lamont.
Australia’s first recorded caravan was built in 1927, but the units weren’t produced in volume until the 1950s, about the same time that state caravanning associations came into existence. The industry attracted attention of major manufacturers in the 1960s when 15- to 16-foot holiday vans were popular. By the 1970s, RVs were used by miners and other itinerant workers as primary living vehicles. Even RV park owners were permanently installing the 23- to 35-foot vans to their sites, he noted.
The industry peaked in 1975 when 37,500 RVs were manufactured. Approximately 20,000 new units were built in 2012, Lamont explained.
Increased competition from resorts, high rise apartments and the desire for international travel created a flood of second-hand RVs between 1975 and 1990. That tide has stemmed, but, due to the aging inventory of RVs and the fact that only 20,000 new units are made a year, demand for used RVs remains strong.
In the early 1990s, when the CRVA was formed, the industry built about 5,600 RVs and launched a coordinated national revival by bringing back the 18- to 20-foot holiday vans, said Lamont. By the turn of the century, the industry was producing about 20,000 RVs per year, most of which were holiday vans — and that changed the face of caravan parks in Australia.
“Today, an overwhelming majority of caravans manufactured today are purely for travel purposes, with a very small percent permanently located at caravan parks,” said Lamont.
The Australian market wasn’t deeply impacted by the Great Recession, and after a one-year dip in production, the industry bounced back quickly buoyed by national stimulus marketing strategies implemented by CRVA to combat the economic downturn, Lamont explained.
The CRVA unites the activities of state RV associations, service providers, suppliers, camping stores, corporate RV parks, dealers, manufacturers, and caravan parks. In 2007, the association was successful in getting the history of caravanning featured in a series of specially-designed postage stamps.
Australians spent 67.8 million nights in campgrounds last year, of which 45.3 million were in caravan parks greater than 40 sites, Lamont explained. Surprisingly, 90 percent of those camping nights were spent outside of Australia’s capital city tourism regions. The greatest user group in the market is the 35- to 49-year-olds which account for 50 percent of all caravanning and camping. Surprisingly, the older population are some of the largest rejectors of a caravanning or camping lifestyle, although a large section of this population also did not plan to take any sort of holiday, he said.
“The biggest resistors to our industry are those who perceive the industry to being archaic,” said Lamont. “Our marketing is centered around 35- to 49-year-olds in hopes of attracting older people into doing what they did when they were younger.”
In fact, the new marketing campaign includes targeting a prime-time children’s show that depicts families doing things like surfing, dune riding and visiting zoos while caravanning.
“We need to become more about selling a lifestyle rather than selling a product,” said Lamont. “We need to develop ways for Australians to touch and feel the product so the next time they want to go fishing or surfing, hopefully they will try camping.”
As a result, most advertisements for RVs on Australian TV shows depict people using the RVs, not the RVs themselves. The RVs often appear in the background, while foreground activity shows all the things people can do while RVing.
The caravanning market generates $7 billion annually, and accounts for 11.3 percent of all overnight stays, said Lamont. Most of the market is driven by domestic travelers, but nearly one in 10 are international travelers who want to tour Australia by RV. Of the international travelers, 67 percent come from Europe, 9 percent from New Zealand, 6 percent from the United States and 8 percent from Asia. Only 0.5 percent of Australia’s visitors come from China.
Lamont said the most cost effective way to get into caravanning in Australia is by using what they call “tent trailers.” Those units consist of a box trailer with a tent section that lifts out into a sleeping space. Tent trailers comprise between 1 and 2.5 percent of the total RVs produced.
Between 13 to 20 percent of the market uses products camping trailers, which are identical to American popups. However, the percentage of those units sold is on the decline, said Lamont.
Truck campers make up less than one-half of 1 percent of all RVs sold in Australia.
A more popular type of RV sold in Australia is what they call pop-top caravans. They comprise 25 to 30 percent of the total product production, but they are also declining popularity.
“Pop-top caravans have all the features of a normal caravan and offer improved fuel economy,” Lamont explained. “Their low profile can make them easier to tow and they are also easy to stow in a garage or carport. When on site, the top section is raised to provide full headroom in the unit.”
The most popular RVs by far are the traditional caravans that comprise 40 to 55 percent of the market each year. Like American travel trailers, these units are fully self-contained and include a shower, toilet, gas stove and microwave.
Camper vans are modified vans that allow the roof to be raised for easier standing and mobility. Cupboards are installed along with a central table and, perhaps, bunk areas for children. Although these units make up 1 to 2 percent of total production, they are gaining in popularity as second vehicles for daily use, Lamont explained.
Class C motorhomes are declining in popularity to the point they comprise only 4 to 7 percent of total production. Driving one that weighs more than 4.5 tons requires a special endorsement on the person’s drivers license.
Fifth wheels are not nearly as popular in Australia as they are in America. Current fifth wheel production accounts for only 0.1 to 0.3 percent of all RVs made in that country.
However, most holiday parks in Australia are installing cabins for their guests who like to travel, but don’t want to tow a vehicle. Approximately 35,000 cabins are in use around the country, and more are being added every year, Lamont said.
The current RV market consists of 474,806 registered caravans and motorhomes, of which 89 percent are towables and 11 percent are motorhomes. RV registrations have increased 14.6 percent in the past three years. One manufacturer, Jayco, accounts for approximately 50 percent of all new RV production.
There are approximately 200 manufacturers in Australia, but only 65 produce a significant volume of RVs each year, Lamont explained. In fact, one of the challenges the industry faces is the easy entry into RV manufacturing. “If you can make a product and find a buyer, you are in business,” he added. “It is something we, as an industry, are trying to clean up.”
New consumer laws have been brought in to protect consumers making unwary manufacturers open to huge liability, said Lamont. ”This is particularly so with imported product which is not used to the harsh geographical conditions of Australia,” he explained. “Unless the batch is built specifically for the Australian market under specially created Australian design rules, production poses significant difficulty for those considering Australia as a potential export market. Indeed Australian consumers are already extremely wary of imported product. With limited volume available and the additional construction demands, the Australian market may not the lucrative frontier it appeared at first thought.”
There are 1,638 holiday parks with more than 40 sites, and they supply more than 170,000 individual campsites. The average occupancy level is 54 percent and that segment of the industry accounts for $1.135 billion in annual sales — an average of $693 per park. However, average park income is advancing at 10 percent a year, said Lamont.
One of the challenges facing the industry is an aging fleet of RVs on the road. More than 53 percent of all RVs in use in Australia were manufactured before 1995, said Lamont. Only 21 percent were built between 2006 and 2011. Another challenge is the free camping promoted by communities in hopes of attracting shoppers to those cities.
“The concept of providing subsidized pricing to entice consumers is being hotly debated,” said Lamont. “The question remains, if anything happens in a locally-provided facility, who is liable?”
The future of the Australian RV market looks bright, he added. Interest rates are coming down, and with those rates keeping the Australian dollar artificially high, international travel is more attractive to caravanning and camping customers, Lamont noted. But, there is also a degree of uncertainty over a pending federal election and talk of the mining boom being over.
However, the only product seriously competing with RVs are cruise lines. And by marketing local travel with the freedom offered by the RV lifestyle, Lamont believes the industry will continue to grow in popularity and profit.
Top — Australian postage stamp promoting the caravanning lifestyle
Second — RV market share in Australia by various RV types
Third — An Australian camper van
Fourth — Pop-Top campers are one of the most popular RV types in Australia