Uncertain economy puts pressure on Caravan market

EurotaxGlass’s today reports that Caravan retailers are facing uncertain prospects for the remainder of 2006. Dealers, distributors and manufacturers are all fighting hard for market share and consumer nervousness over the economy seems to be the primary factor.

So far this summer ‘World Cup fever’ has commonly been cited by the motor trade as an unwelcome distraction and caravan retailers are no exception, although the real issue would appear to be the general rise in the cost of living. Higher utility bills and fuel costs coupled with uncertainty over the long-terms prospects for interest rates are resulting in a high degree of financial caution from consumers.

Despite the onset of the core summer holiday months, the usual upbeat attitude of dealers is being somewhat tempered by the trade’s concern over used values as we move towards the end of the season.

“With a hesitant market, manufacturers are increasingly forced into accepting lower margins on new models and are reluctantly drawing back from prices increases,” says Randal Thomas, Editor of Glass’s Guide to Caravan Values. “If this proves to be a common trend, late year, used model values will come under increasing pressure, particularly for stock that dealers have carried over the winter months.”

As a consequence, EurotaxGlass’s has reduced some used values to take account of the pending change of season and the price pressure of discounted new models. However, in a changeable climate, values may well be subject to further downward adjustment as the year progresses.