Recreational Vehicle Market

The growth of the global recreational vehicles market is driven by various factors such as the growth of the tourism sector and availability of recreational vehicle rental services. However, the growth of the market is expected to be hindered by the government regulations related to recreational vehicle and issues related to component standardization.

According to the World Travel & Tourism Council, the tourism sector has witnessed continuous growth since 2009 and is one of the fastest-growing economic sectors. Modern tourism is closely linked to the development of adventure camping and camping grounds across Europe, Asia-Pacific, and North America. The emergence of adventure tourism has been leading to increasing investments in this sector. Such trends have made tourism one of the key factors fueling the demand for recreational vehicles.

Various government organizations, such as the European Tour Operators Association Ltd, European Travel Commission, German Tourism Association, and European Travel Agents’ and Tour Operators’ Association, are taking various initiatives to increase the number of tourists and reducing taxes for tourism. Such initiatives are focused on encouraging investors in the tourism industry to capitalize on the increased demand for tourism. The below graph depicts the direct contribution of travel & tourism to the GDP is expected to grow by 3.6% and reach USD 4,065.0 billion by 2029.

The recreational vehicles include a kitchen, a bathroom, and one or more sleeping facilities along with additional features such as air conditioning (AC), water heaters, televisions and satellite receptors, and quartz countertops. Furthermore, the increasing use of recreational vehicles not only for vacation traveling but also for tailgating, traveling with pets, and as a preferred mode of transportation in outdoor sports and other leisure activities are the factors driving the demand for such vehicles around the world. Thus, the growth of the tourism sector is expected to drive the growth of the global recreational vehicles market during the forecast period.

Currently, the adoption of recreational vehicles is still limited in developing and underdeveloped regions. However, their adoption is expected to increase over the next few years owing to the significant growth of the middle-class population and rising per capita income. Thus, the impact of the growth of the tourism sector on the global recreational vehicles market is expected to shift from moderate to high over the forecast period.

An increasing number of initiatives by government bodies across the world to promote the adoption of recreational vehicles is expected to drive their demand. Some of these initiatives are mentioned below.

¡ In 2018, the Chinese government pledged to add 2,000 more RV campgrounds by 2020, compared to 300 in 2018, to boost the growing interest in the RV lifestyle and tourism to rural areas.

¡ The RV Industry Association is working closely with government agencies and major trade groups in China, South Korea, and Japan to promote the US recreational vehicle standards and improve their sales.

This is expected to increase the demand for recreational vehicles across the world in the next few years. Furthermore, such factors are encouraging investments in product development by private companies in the global recreational vehicles market. A few instances of such developments are mentioned below.

¡ In 2018, Nissan launched an electric campervan based on its e-NV200 van model in Spain. Additionally, a few existing RV manufacturers, such as Winnebago Industries Inc. and Dethleffs Motorhomes, have also started developing electric motorhomes. With new technologies and new models, the manufacturers are planning to expand their presence in different regions and increase their market share in the years to come.

¡ In 2018, Pinnacle Specialty Vehicles unveiled ‘Finetza,’ India’s first and best-in-class expandable motorhome and the ultimate definition of luxury with finesse and style, at Auto Expo 2018. This smart and luxurious motorhome is an epitome of luxury-on-wheels and a revolutionary introduction aimed to redefine the country’s on-road travel experience.

¡ In 2018, American Coach launched American Dream Class A Diesel RV at the annual Elkhart RV Dealer Open House event. American Coach represents REV Group’s top-of-the-line luxury recreational vehicle brand.

The strategic initiatives by major market players are still at a primary stage and are concentrated only in a few regions. However, they are expected to increase during the forecast period. Thus, the strategic developments for growth by major players are expected to create an opportunity for the growth of the global recreational vehicles market during the forecast period.

Many government bodies have introduced regulations related to the safety, ventilation, permit and examination requirements, construction, weight, inspection of propane appliances, propane system, width, and electrical installations inside the vehicles. For instance,

¡ In 2018, the Manitoba (Canadian province) government announced that it would modernize the regulations for manufactured homes and recreational vehicles. The proposed modernization includes updating the definitions and referenced standards under the Building and Mobile Homes Act and removing the permit and inspection requirements for the sale of used ‘mobile homes.’

¡ In 2018, the Ontario recreation vehicle dealer’s association’s technical standards and safety authority (TSSA), proposed essential changes to the Propane Code Adoption Document (“CAD”), which would require recreational vehicles equipped with permanently mounted propane tanks to have the propane appliances, which are propane system and tank, inspected on a five-year cycle.

¡ In 2016, the office of the Assistant Secretary for Housing—Federal Housing Commissioner, HUD, proposed the rule, at 81 FR 6806 to revise the definitions of “manufactured home” at 24 CFR 3280.2 and “Recreational vehicles” at 24 CFR 3282.8(g), to clarify—and effectively expand—the exemption of recreational vehicles from the HUD's Manufactured Home Construction and Safety Standards and its Manufactured Home Procedural and Enforcement Regulations. The rule proposed to change the definition of RVs by revising the four-part test used to determine whether a structure qualifies for the recreational vehicle exemption. Specifically, HUD's rule proposed a definition focused on whether or not the structure is certified as a manufactured home and whether it is constructed according to two consensus RV standards: the ANSI A119.5 Park Model Recreational Vehicle Standard and the NFPA 1192-15 Standard on Recreational Vehicles.

Such regulations regarding recreational vehicles are currently hindering the demand for recreational vehicles. The lack of standardization in recreational vehicles and components, while manufacturing is a major concern for end users. The replacement of damaged or faulty components during servicing and maintenance is difficult due to the lack of standardization among component manufacturers. Thus, the government regulations related to recreational vehicles and issues related to component standardization are expected to restrain the growth of the global recreational vehicles market during the forecast period.

Many recreational vehicle manufacturers are continuously investing in product development activities to establish and maintain the standardization in component manufacturing and to improve their regulatory compliance capabilities. Hence, the impact of the government regulations related to recreational vehicles and issues related to component standardization on the global recreational vehicles market is expected to shift from high to low over the forecast period.