Sep 17, 2019

RV shipments decline as Trump administration touts economic "boom"

Photo: Jeffrey Greenberg/Universal Images Group via Getty Images

As White House economic adviser Larry Kudlow projected a sustainable "boom" in the U.S. economy this summer, sales in the recreational-vehicle industry have been trending downward, signaling possible economic turmoil to come, Bloomberg writes.

Why it matters: The last 3 recessions (which began in July 1990, March 2001 and December 2007) were all foreshadowed by slumps in RV manufacturers’ shipments. While, as Bloomberg writes, "that’s not a big sample size, and there were modest RV-shipment dips in the mid-1980s and mid-1990s that turned out not to precede recessions," the drop-off in RV purchases could be a sign of consumers growing less optimistic about their financial futures.

Background: In June 2018, RV manufacturers shipped 11.4% fewer trailers and vehicles than in the year prior. And aside from a slight rebound this July, shipments have continued to dip.

Reality check: The Wall Street Journal reports that many manufacturers believe the slump is a result of overproduction after a boost in demand in 2017 that didn't continue into the following year.

    • Bloomberg adds: "RV shipments by manufacturers aren’t the same thing as RV sales, and a decline in the former might represent overproduction by manufacturers or over-ordering by dealers rather than an actual drop in consumer demand."

Between the lines: The sales slowdown also comes as manufacturers hiked prices to counterbalance increased production costs amid the U.S.-China trade war.

  • Estimates say more than 500 RV-related goods could be affected by increased tariffs, including aluminum and steel, along with amenities such as toilet seat covers and hides for leather furniture.

Our thought bubble via Axios' Felix Salmon: RV shipments are slipping from "off the charts great" to merely "very strong." Directionally, that's bad, but we're still in a fundamentally healthy economy.

Go deeper: The synchronized global slump

Go deeper

Business leaders spooked by Trump's manufacturing slump

Data: Bureau of Labor Statistics; Chart: Axios Visuals

American manufacturers rode a wave of optimism after President Trump took office, clinging to his promises to revive the industry and bring back jobs.

Yes, but: The politically important sector is being choked by his trade war with China, and business leaders tell Axios that the tariffs threaten to upend the economy if not addressed soon.

Go deeperArrowOct 6, 2019

U.S. trade deficit grows to $54.9 billion in August

The U.S. trade deficit grew to $54.9 billion in August, jumping for the first time in 3 months due to increased imports, reports the AP from Commerce Department data.

Why it matters: Though it had fallen in June and July, the country's overall trade deficit is still up for the year as a result of President Trump's ongoing trade war with China.

Go deeperArrowOct 4, 2019

IMF predicts slowest global economic growth since 2008 financial crisis

Gita Gopinath, the IMF's chief economist, and Gian Maria Milesi-Ferretti, the IMF's research deputy director, take questions from the media. Photo: Olivier Douilery/AFP/Getty Images

The International Monetary Fund is now predicting global economic growth will slow to its weakest level since the 2008 financial crisis in its third revision of its 2019 forecast.

The big picture: A sharper-than-expected slowdown in international trade has affected manufacturing and investments, according to the organization's World Economic Outlook.

Go deeperArrowOct 15, 2019