Trump’s Tariffs Are Killing RVs

Written by SK Ashby

The overwhelming majority of recreational vehicles (RVs) sold in the United States are manufactured in the state of Indiana, making it one of the few things sold in American that is almost entirely manufactured or at least assembled by Americans, but Trump's tariffs are killing the industry.

More specifically, Trump's tariffs on imports of foreign steel and aluminum along with his tariffs on various plastics imported from China are increasing costs and driving down sales.

Shipments of RVs have dropped by over 20 percent year-over-year and sales have fallen by as much as 23 percent for some dealers.

Shipments of RVs to dealers have fallen 22% percent in the first five months of this year, compared to the same period last year, after slipping 4% in 2018, according to the Recreational Vehicle Industry Association. [...]

The tariff price increases are what tipped the RV business — it started the landslide, no question,” said Tom Bond, the materials and purchasing manager at Adnik Manufacturing, an Elkhart-based division of Norco Industries that has been hit with higher costs on metals it uses to make components such as seat frames.

Thor Industries Inc - which controls nearly half the RV market - said its sales in North America fell about 23% in its fiscal third quarter, which ended in April, compared to a year ago. The company said in a release that it has cut production and shifted to four-day weeks at some North American plants.

The CEO of Renegade, the largest manufacture of luxury RVs, told Reuters that American parts suppliers have raised their own prices while Trump has forced higher prices on foreign imports.

So, in some cases, manufacturers are eating the tariffs and importing foreign goods because paying for American-made parts is not cheaper than paying for Trump's tariffs.

Industry analysts who spoke to Reuters say Trump's tariffs have increased the price tag of RVs for American consumers by at least 5 percent.

It's not as if the whole economy hinges on the health of the RV industry, but this and other similar stories are adding up. This is economic activity that directly touches average people. Not many Americans can afford to buy RVs, but the people who build them, service them, or work in businesses associated with tourism could pay a price. This isn't happening in a vacuum.