Keith Gooden:
I’m Keith Gooden and welcome back to the Motorhome Matt podcast, where we talk about holidaying in the UK and the motorhome industry. Our expert guiding us through it all is Motorhome Matt himself, Matt Sims. Welcome, Matt!
Matt Sims:
Hi Keith. How are you doing?
Keith Gooden:
Fine, thanks very much. The most important thing, though, is how you’re doing! We’re a year on from the Brexit deal – how has it affected you, your business and the motorhome industry generally?
Matt Sims:
Gosh, talking about Brexit, remember that! Certainly a lot’s happened since then. I remember one of the biggest issues we faced at the time was the fact that we couldn’t take our dogs to France – the pet passport was going to be abolished. I remember being called into the BBC to talk about it.
Look at what’s happened since 2020 and how the world has changed. Certainly it’s changed for us in the last two years. We’ve not really seen any European residents coming to the UK for a holiday in a motorhome with us, but then of course we’ve seen record numbers of British people wanting to go away in a motorhome. So we replaced those customers with new British ones, but that’s certainly been a huge issue.
We used to do several airport transfers a day during Summer where we’d be running people to and from Bristol airport. I think we did two last year and that was the folk traveling to us from Scotland – being down in the South West, it’s an easy flight. There’s certainly been lots of change in terms of customer profile over the last couple of years, whether that’s due to Brexit or COVID – which has had a big impact as well.
Lack of foreign travel
Keith Gooden:
So what proportion of foreign visitors were you dealing with in your motorhome business?
Matt Sims:
Typically around 25%, and they would be from all over Europe. We used to get lots of Swiss, French, German, Dutch, Irish, as well as Chinese visitors and lots of Australians. We did get some Americans too, although they were always a bit scared by a motorhome because they had no idea what that left pedal did – the one we call a clutch! We had people from all over the world, and that all disappeared in 2020.
Keith Gooden:
And what did that mean for the industry generally?
Matt Sims:
Well, for the tourism industry in Britain, we of course didn’t get any European tourism spend in the UK – or very little. Brexit made it difficult for us to go to Europe, particularly if you wanted to take a dog or a cat. Then COVID clamping down travel restrictions really put the nail in the coffin for us going abroad and for foreign folk coming here.
Now, as we record this, we are unable to travel to a number of countries in Europe. We can’t currently transit through France. That’s going to have an impact on the British pound being spent in Europe, which buys you less than it did two and a half years ago. Despite being a cheap destination for French or Swiss visitors, for example, we are unlikely to see that money come and be spent with us here.
COVID-19 travel restrictions
Keith Gooden:
As you say, that loss of business from the continent, whether partially or wholly due to Brexit and COVID – that’s been made up for by an increase in people not being able to travel abroad and ‘staycationing’.
Matt Sims:
That has been a positive out of COVID for us. As Brits, we all love to go to Spain, France, Germany, America, and during COVID we couldn’t do it. This meant that a motorhome holiday became a reality for many, as did a British holiday in a cottage or static caravan. The British tourism industry has boomed over the last year, although it did suffer initially. There was lots of uncertainty in 2020 as to how, as a tourism and motorhome hire industry, we were going to deal with the pandemic.
I remember being very scared at the prospect of dealing with COVID and how we were going to keep our teams safe, how we were going to keep our motorhomes safe and how we were going to give customers assurance and keep them safe. There were so many questions and so many unknowns, but it’s incredible how we’ve all come to deal with this, and we’ve just accepted it.
I think as industries and as the general public, I think we’ve all become very familiar with what’s expected of us, whether it’s wearing a mask, cleaning our hands or being COVID aware in whatever environment we’re in.
Parts and delivery delays
Keith Gooden:
I know for a fact that off the coast of America, there’s thousands of tons worth of cargo that they currently can’t export. We know that that’s happening in the UK as well. What does that do to a business such as yours and the holiday industry generally?
Matt Sims:
The impact is acute. At this time of year we would normally be ordering new motorhomes for delivery in March, and at the moment we just can’t order them. They’re not there to be ordered. Even if we did order them, they wouldn’t come. We saw that last year after practically putting a wholesaler of motorhomes in a headlock and forcing them to tell me when we were likely to get these. They finally admitted it would possibly be October – by then, we’re starting to think about Christmas.
The same is true this year. There’s lots of people who have ordered a new motorhome last year for delivery in the spring of 2022. And I fear they are not going to see it until maybe late Autumn of 2022, if at all, and production will be delayed into 2023. Imagine you’ve just retired. You’ve had your nest egg payout, you’ve got your plans made up. You’ve got your health, you’re willing, you’re able, you are desperate to travel and you’ve made these huge plans to travel throughout 2022, but the motorhome doesn’t come. Your plans are ruined. I’m conscious we’re going to see many people being very disappointed this year.
Keith Gooden:
The orders for motorhomes are in. And let me just make it clear – customers have been told by companies that are manufacturing the motorhomes that they will be delivered by spring, but you are saying you don’t think they will be.
Matt Sims:
That’s right. We saw van manufacturer warehouses shut down. The production plants were closing during December. We’ve seen factories in China, where many of the components are made for the cars and vans that make the motorhomes, have only been on for two or three days a week due to electrical power outages. Some factories in China have been working at 50% capacity. We’ve seen a lack of steel shipping containers being made, which means the parts can’t be shipped across to Europe and across to the UK. These huge stories which we see on the news and think they don’t really affect us – when it comes to us actually putting the key in the ignition of our new motorhome, and we find out it’s not gonna arrive, that’s when the rubber hits the road.
Near us, there’s a motorway flyover, the M5 Avonmouth Bridge it’s called. As you drive over it you can look down and see normally thousands of brand new cars and vans parked in a big lot. I drove over just before Christmas and it was just grey tarmac. There were no cars there at all. Normally at this time of the year, it is heaving ready for car deliveries for the March registration launch. Where are they? I suppose they’re just not being made. It’s the same with motorhomes and the components – the factories across Europe that assemble and produce the motorhome are just not getting the parts. And so production numbers are going to be down.
Keith Gooden:
As you say, it’s components which are the issue. So if somebody has put an order in, you’re not saying they’re not gonna get it, but from your experience, it’s looking unlikely.
Price increases are a reality
Matt Sims:
On the timescale they’ve been given, it’s looking unlikely. They’ll get it eventually, and of course the motorhome manufacturers will up production to try and keep those order books full. Price increases have been a reality.
At the end of 2021, we saw manufacturers imposing a price increase on their dealer network. The dealer was being told, ‘you should impose this on the customer,’ even though the deal had been done. Many customers were then saying, ‘I don’t want to suffer the price increase.’ And so the dealers said, ‘we’ll give you a deposit back and we’ll sell it to the next person in line,’ because they had a queue. An 8% increase doesn’t sound very much, but when you’re spending £80,000, that’s a significant sum of money.
New motorhomes are cheaper to buy than used
Customers are having to pay this extra money to ensure they get their motorhome, and then compounding the issue is this potential for delay on when the motorhome is delivered. So people will get it. But of course, the knock on effect for this is that the used motorhome market is just going up and up and up. New motorhomes are cheaper to buy than used because the new ones aren’t there.
If you’ve got a used motorhome that’s one, two, even ten years old, it’s great news because you’ve probably been able to use it for two years and when you come to sell it, you are undoubtedly going to sell it for what you paid for it, or even make money. This has certainly been an impact in the used motorhome market with prices going through the roof.
Keith Gooden:
So we’ve been used, for years, to ‘gazumping’ in the property market, where you put a bid in for a house, somebody comes up behind you and says, I want to buy instead and offers a bit more. The estate agent comes back and says, ‘well, if you offer a bit more than they offered, then we can do the deal.’ And it goes round in a circle. We’re talking about ‘mozumping’ now for motorhomes, aren’t we?
Matt Sims:
‘Mozumping’, there’s a good one – ‘mohozumping’! It’s not a pastime we’ve been partaking in. A chap rang me from Ireland and said he was interested in a particular motorhome that we’d advertised about half an hour earlier. He was straight on the phone and wanted to pay a deposit there and then, and I said, ‘no, we don’t tend to operate like that. We’d much rather you came and saw it and knew what you were buying before you gave us any of your money.’
He said, ‘Matt, what you must understand is this is the fifth one we’ve found. Every time we fly to the mainland, they’re sold, so we need to secure it with a deposit. We’ll come and see you in a couple of days’ time and I promise you, we are going to buy it.’ And sure enough, they did buy it.
This has been a real challenge for people looking for a motorhome – you find the model or layout you want, and then you’ve got to try and actually secure it. It is a bit of a race against time, particularly with popular layouts, and dealers know this so the prices creep up. The supply chain costs have gone up too, so the end result is that everything goes up in price. If you’re new to the market, buying a motorhome is no longer a cheap pastime. They have become more expensive. It’s still a brilliant pastime, but the costs have definitely risen.
Motorhome Earn
Keith Gooden:
So if you already own a motorhome, the news is good because you can come to a business such as yours, where you’ll store it and rent it out to holidaymakers where there’s demand.
Matt Sims:
Absolutely. We call it Motorhome Earn. Many people bought a motorhome last year or the year before and are thinking this year that they are not going to use it as much, but they don’t want to sell it.
Right at this point in time, January 2022, the prospect of going back to L.A. or Spain on holiday is looking a bit dicey, so the motorhome is a great plan B for many families, but at the same time, it’s costing them money to own it. Perhaps it’s on finance and it’s an added cost to have it on the drive. We do offer a program where people can “give” it to us and we rent it out, giving them an income from it. We take care of it and they can use it whenever they wish to as well.
If you’re thinking of buying a motorhome, plan ahead
Keith Gooden:
So who would’ve known it, you’re sitting there, you’re waiting for your pension pot to pay out, nice and tax free. You should be thinking a couple of years ahead, perhaps.
Matt Sims:
Yes, absolutely. If you’re thinking of buying a motorhome, it would be sensible that you order a new one and buy a secondhand one in the short term, just to have a motorhome if you need one now. Or you could hire one for a year until that new one is delivered, and if your new one comes earlier – let’s hope it does – you can always cancel the hire booking.
Most motorhome hire businesses will have a good and decent refund policy. All of us have a queue of people waiting for availability. We would certainly be very happy to give someone all of their money back and then find a customer to replace that booking.
Keith Gooden:
Thanks for visiting the Motorhome Matt podcast. Remember to check back here for more episodes full of hints and tips and helpful advice. We’ll see you soon for another Motorhome Matt podcast, brought to you by www.thatleisureshop.com.
