Don’t Look Now, But Airstream Is Streaking

An unexpected boom in RV demand has led to record retail sales—success that CEO Bob Wheeler says makes him "feel guilty just to talk about."

As the U.S. pandemic started in March, Bob Wheeler and his team projected a 70-percent April drop-off in sales for their Airstream recreational vehicles. That wasn’t an unreasonable expectation given the abrupt shutdown of the economy, the millions of job losses, the fact that Airstreams are a hugely expensive and discretionary purchase – and that Airstream’s own dealers were struggling to stay open and laying off half of their workforces across the country.

“But our guess turned out to be grossly wrong, in the right direction,” Wheeler, CEO of the Airstream unit of RV giant Thor Industries, told Chief Executive. Airstream sales fell by only 30 percent last month and then rapidly rebounded in May. “Things have been on fire. In the last two weeks, we have seen record retail sales across the country, well beyond anything we could have anticipated. It makes me feel guilty just to talk about it.”

In other words, while Wheeler had entertained hopes that the post-pandemic landscape might be somewhat friendly to Airstream and to the RV transportation model overall, he hadn’t anticipated that favorable factors would coalesce so quickly and produce such a spike in sales even while the pandemic was still raging at original strength in some areas.

“We started to think that the post-Covid travel landscape might stack up really well for RVs,” Wheeler said. “People don’t want to get on cruise ships or airplanes or go into crowded places now. They want to travel in their own home with their own kitchen and bed. But all of that was just theory until we started to see it manifested in the marketplace.”

Wheeler said that sales also have been unexpectedly strong for sibling brands at Thor Industries, the Elkhart, Indiana-based parent of Airstream and of several other RV makes. In fact, the Covid-19-induced rebound has followed a moribund couple of years for an overall RV market that lost some steam after a torrid decade of sales following the Great Recession.

“Thor makes a lot of commodity products, and for families considering their options, RVs are a great investment,” Wheeler said. “Maybe their trip to Europe or plans for Disney World just got canceled.”

Not that it’s going to be clear cruising for Airstream or for any RV manufacturer; they make very expensive and traditionally “non-essential” products, and they’re at the start of what could be a protracted recession in the U.S. and worldwide.

And while Airstream got its industry-state-of-the-art manufacturing plant at its headquarters in Jackson, Ohio, up and running in early May, the company had to do so with all sorts of new safeguards. These included not only what has become de rigueur among re-opening manufacturers – masks, temperature-taking, fastidious cleaning – but also some steps required because of the particular nature of making RVs.

For instance, some extensive ergonomic redesign was required for the many jobs that occur inside the vehicles themselves during the assembly process. “In those areas where it’s hard or impossible to maintain a six-foot distance, we’ve been issuing full face shields and having fewer people in the units at the same time,” Wheeler explained.

Airstream’s dealers and its entire distribution model have had to pivot as well, to showroom appointments, various types of distancing, and the loss of some of their most effective forms of marketing, such as the elimination of many of the industry’s physical trade shows for at least the rest of the year.

But Wheeler already has been pondering whether this short-term windfall could become a long-term opportunity for the brand and strategizing about the possibilities.

“Will it be lasting, or is there going to be a snapback effect?” he said. “We think there are things here that are going to be lasting,” such as Americans “wanting to reconnect with nature” and “realizing the benefits of being in open spaces with fresh air.”