11 April 2023
11 April 2023, Comments Comments Off on Mike Lanciotti – REV Recreation Group
Mike Lanciotti - REV Recreation Group

REV Recreation Group: from the recent past to present

Innovative design concepts, exceeding dealer satisfaction, and effective production practices have imposed a positive future for the REV Recreation Group. Aboutcamp BtoB spoke with Mike Lanciotti, President, REV Recreation Segment, to further determine what drives the growth of its strong portfolio of RV brands

Words Steve Fennell – photo: Permission by the REV Group

Mike Lanciotti has been President at Renegade RV since 2008. Following an acquisition of the company in 2016 by the REV Recreation Group, he continued his leadership before being appointed President, REV Recreation Segment in 2021.
In that time, well-established RV brands currently under the company’s banner, including Fleetwood RV, Holiday Rambler, American Coach, Lance Camper, Midwest Automotive Designs, Renegade RV and Goldshield Fiberglass, have successfully maintained their position as key players in the RV industry.
With several new models and initiatives this year, we discussed the company’s goals and business strategies through 2023 and into 2024.

Aboutcamp BtoB: What are some of the trends in the North American RV industry that you have recognized within the last five years and how is the REV Recreation Group adhering to these trends to better serve its dealer base and consumers?
Mike Lanciotti: I think people are enjoying the outdoors more, the fact that many RVers are now working remotely from the road, and the passing of the Great American Outdoor Act by the U.S. Federal Government in 2022 are some of the most important recent trends. They all strongly support this lifestyle.
I also think the major investments in the outdoor recreation infrastructure with the purchasing of land and other natural resources, and turning them into places to camp, is another huge positive for us and the industry.

The new Fleetwood Frontier GTX 37 RT

Being a B2C business and meeting these trends, we continually work hard in product development. We do this by listening to consumer and dealer feedback, which helps us identify what is popular and what consumers like, but we benchmark other demographics and design concepts in other industries. So, if we like something that the marine or private aviation sector is doing, and we feel it’s a good fit for the RV space, we work to see how it can be applied to some of our brands.
As the RV companies in the REV Recreation Group are high-end, our big focus is also on appearance. We just feel it’s just as important as overall function. Our brands will continue to be appealing to the consumer and every year we make them stronger and better.
We are also fortunate that our products have strong brand recognition. Fleetwood RV is one of the hallmarks of the industry and has been around for a long time. We work hard to sell brand identity but we fully support each of our brands. We believe they will remain strong by delivering a quality product.

Aboutcamp BtoB: In addition to industry trends, the demographics among RV buyers have changed considerably. How is the REV Recreation Group remaining competitive with the evolving younger demographic?
Mike Lanciotti: The average age of RVers is certainly much younger than it once was but what has really played into the hands of RV manufacturers in recent years is the current difficulties and high costs of air travel. With an RV, people realize more and more that they can simply pack their bags, load them up in the RV and go.
More than anything, however, COVID-19 has dictated how people travel now and even how they work. They realize they can do their job remotely and also do it on the road in the comfort of an RV. Meeting these needs by providing easier accessible WiFi connectivity and user-friendly portable electronic systems is now very important.
We made a good move for the 2023 model year with our new Fleetwood Frontier GTX 37 RT, which introduced the corner office, an industry first. We windowed it out, so people are provided with nice natural light at the desk. It’s like being in an office at home or even in the workplace. There’s a lot of interest now in that design for our class A motorhomes.
The larger coaches may not be the perfect match for millennials, but they are of interest to other long-term RVers. Class Bs are still very appealing to the younger crowd. They have many features and are very functional, but we design and manufacture all classes to provide a unit that will be a good fit for all ages.

Aboutcamp BtoB: Does the REV Recreation Group get a lot of influence from suppliers as far as providing more technology to its brands?
Mike Lanciotti: It’s interesting, our suppliers always have a new concept for us to consider and we get a lot of feedback from our dealers about this as well. Technology is a big deal. For example, when RAM came out with a huge LCD monitor the size of an iPad in the center of the console for one of its trucks, its sales increased significantly.
However, I think technology has to be easy to use and very functional. A lot of control panels have grown in size so they are clear and concise. We are finding that consumers are willing to pay for electronics that are comfortable for them.

Aboutcamp BtoB: Now more than ever, RV manufacturers are using lightweight materials in their units to better manage weight and labour costs. Can you provide some examples of how the REV Recreation Group has been making similar efforts?
Mike Lanciotti: We now utilize a lot of one-piece synthetic materials as well as lighter aluminum whereas we used steel before. Generally speaking, for all of our brands, we do a lot of weight analysis where we determine the weight of each unit before it leaves the plant.
By this, I mean we pull all four wheels of the unit and weigh it on a scale to get the exact weight from the four corners, ensuring it has proper balance before delivery. We always make sure that they are under the regulated weight since we know the units will be weighed at some point again once it takes delivery.

While lightweight, the Lance 650 Truck Camper doesn’t compromise style and comfort

An example of some of REV Recreation Group’s lightweight units includes Lance’s ultra-light and eco-friendly travel trailer, which has earned the RVDA’s DSI Quality Circle Award, as well as the 650 truck camper. It’s only a little more than 2,000 pounds so it isn’t very heavy and can easily fit a variety of truck beds.

Aboutcamp BtoB: How do you manage weight and what materials are used for REV Recreation Group’s larger models in divisions like American Coach, Fleetwood RV and Renegade RV?
Mike Lanciotti: What a lot of people don’t realize is there is a lot of weight under the floor and in the basement of these larger units. A lot of steel is used. For example, if 16-gauge steel can be used and still achieve optimal strength to weight savings rather than using heavier 18- or 20-gauge steel, we make the spec change.
Determining where the stress is on the product is also very important. We do this with AutoCad and SolidWorks. These systems indicate where there’s not much stress/weight on the unit and in turn, they help us determine where to use lighter gauge steel to reduce weight.
We take weight out of basements all the time and even look at components like storage compartment doors. We don’t want them so heavy that you can’t close them and we don’t want them too light so they won’t latch or even fly open on the highway. There’s always a fine line when determining weight.

Aboutcamp BtoB: The RV industry experienced supply chain issues during the pandemic and production was limited. Are the REV Recreation Group and your dealers currently right-sizing to previous levels of inventory and what is your forecast on this for 2023?
Mike Lanciotti: We are still not anywhere near pre-COVID-19 levels. I think a good backlog for motorized products is six or seven months. Right now, we have a backlog of about one year. Will our dealer inventory backlog get back to pre-COVID-19 levels? I would have to say it could, but it might take an increase in distribution and better channels to get back to those levels.

Aboutcamp BtoB: What channels would you consider for that to happen and can you provide some further details on the current status of the supply chain?
Mike Lanciotti: The REV Recreation Group is fortunate with its motorized product to have registration like a car. We know where each unit was sold and know what Business Trade Area (BTA) has the most volume, who sells the most product, and where the product is present (and not present). We then see how we compare with everybody else.
Just as an example, when we analyze these BTAs we think, if Midwest class Bs are not in a certain region and a competitor is doing well, we consider more channel management.
Right now, we are in a position where we can move where the population moves. Florida, Texas, California and the whole southeast all have large RV distribution. There are pockets in the U.S. where your brands need to be and with the moving population, you need to have a presence there as well.
However, during COVID-19, our dealers had very low inventory and we felt we were smart enough to keep it low so that the demand would be high. However, the supply chain was the governor of our ability to operate at capacity versus the way other manufacturers were able to.

Mike Lanciotti with his team of the REV Recreation Group

The towable market did well during the pandemic because it could. Trailers don’t require an engine with a chip and the supply chain wasn’t holding up production as much. But this also meant we could only run production at a certain level, which happened to be a little less than the market wanted so the dealer inventory was depleted.
Most of our dealers during that time were on allocation. So, we worked hard to make sure our costs weren’t too high, stayed competitive, and the higher cost of materials didn’t result in overall price increases for the consumer.
Currently, since the towable industry has slowed down significantly, our suppliers can redirect common parts to us. Our motorized brands are where their action is so we are getting more of their attention than we did in the past.
To provide an update, when it comes to pure units, approximately 80 percent of all the units in the U.S. are towables and about 20 percent are motorized. When that 80 percent starts to fall off, our motorized division becomes more important to the suppliers. That’s where we are today.

Aboutcamp BtoB: Engine suppliers also experienced challenges with microchip production through COVID-19. How has this impacted REV Recreation Group’s motorized brands and what solutions have you devised to offset these challenges?
Mike Lanciotti: Microchips were an issue everywhere. Now, Mercedes-Benz, Freightliner and some other companies are on track and getting us what we need. They are great suppliers to us and continue to make their product safer and better every year.

Aboutcamp BtoB: Current inflation, rising fuel prices and interest rates are challenging for everyone right now. How is REV Recreation Group managing this economic climate?
Mike Lanciotti: We were at the Florida RV Supershow in Tampa this past January and we had some wonderful dealer partners that represented our product and each of our manufacturers brought an entourage of units for support. It was very well attended, and we sold a lot of units. It’s interesting, most people weren’t talking about interest rates or fuel prices. It seemed to be the last thing on their mind. People were happy that they saw some units that they could buy at the moment and not wait a year.

Aboutcamp BtoB: Are you providing any new incentives for your dealer base to carry products given the current economy?
Mike Lanciotti: We are not offering anything that is unique to the REV Recreation Group. There are always programs for volume rebates near the end of the year. Sometimes, we trade future orders for current orders, but we truly have a partnership with our dealers and try to help them move products from the previous model year to free up their working capital. That’s not unique to us.

Aboutcamp BtoB: We are witnessing new phenomena. Some motorhome manufacturers are buying their suppliers. In Europe, a large group has also bought some dealerships, creating a proprietary distribution network. What is your opinion on this?
Mike Lanciotti: This is not something REV Recreation Group would be interested in doing. Some of our competitors have bought suppliers and we were hoping they don’t try to control their output or where they send their products.

“I think technology has to be easy to use and very functional,” says Mike Lanciotti

I am happy to say the ownership change of the supplier did not alter the way the supplier managed their customers. Even though some suppliers we do business with are owned by our competitors, they treat us like everyone else. I know our peers in the industry hold their suppliers accountable to a certain profitability and I am sure they are comfortable getting that profit from one of their competitors just as much as anyone else.

Aboutcamp BtoB: Looking ahead, what can dealers and suppliers expect from REV Recreation Group through 2023 and beyond?
Mike Lanciotti: They can expect a lot from us. Strategy changes all the time and we get different challenges to certain degrees of difficulty every year. I think we are moving into a time now where there may be a reduction of floorplans, models, and choices so we can lower the cost of production a little and get the prices down to levels that are even more appealing to buyers, but all the while providing a nice variety of options.
I can see working on platforming a little more, so the construction of units are the same but what you build upon them are different, and cutting down on the supply chain by reducing SKUs. It will just make it easier to manufacture and the result is a higher-quality product. I can’t help but think that will be an industry trend into next year.