The CIVD At Caravan Salon In Germany.
Managing Director Daniel Onggowinarso Talks German Success in Caravanning.
MRV: The Buzz, Your Outdoor Lifestyle Insider.
GERMAN SUCCESS IN CARAVANNING: CIVD
Managing Director Of Caravan Industry Association In Germany Talks Regulations & Trends At Caravan Salon RV Show
The business of caravanning, both motorized and towable, has been steadily on the rise in Europe. Daniel Onggowinarso, Managing Director of Caravanning Industry Association (CIVD) represents German interests in the industry in Europe as well as brings the players (including manufacturers and suppliers) together at Caravan Salon, the biggest RV and camping show in Europe, held at Messe Düsseldorf. Onggowinarso sat down with The Buzz at the show to discuss misconceptions of caravanning in Europe, differences in standards and the unprecedented growth and acceptance of the lifestyle.
The Buzz: Can you talk about the role of the CIVD in Europe?
Daniel Onggowinarso: The CIVD is pretty much similar to the RVIA. We are an industry association representing manufacturers, suppliers, but also sponsors which are related to the industry, which is banks, insurances. I am a little bit proud here, the Caravan Salon, especially this one, this year, I think it's the biggest show we have not just in Europe. But I mean in Asia there's nothing like this. And I'm not sure how in the US [with the RVIA show in Louisville].
The Buzz: Yeah, but that's more industry based and not a consumer show. There's three mains in the US: Tampa Super Show, Hershey, and then Pomona in California. So it's pretty much those three. There's some in Houston and stuff like that.
DO: Yeah, I've been to Tampa. I haven't made it to the other two, but Tampa was impressive I got to say. But to me, it's a different setup to be honest.
The Buzz: Can you talk about the setup here and how it sort of reflects what the lifestyle is?
DO: Well, you can see we've booked I think 13 halls this year. We have an increase of 5%, which also reflects the demand of the customers. We're already hitting records in visitors this year, all time records. We were up almost 20% compared to last year, which was also not so bad. I think we've managed to achieve a change in image. Unlike in the States, caravaning or camping has had a negative image for many years.
The Buzz: In what way from your perspective?
DO: Well, you call it “white trash”. We (laughing) have a similar name. Actually, we call them “campers”. To be called a camper used to be an insult [per se]. It wasn't really nice. But if you say, "I'm a camper" now, it's just with more pride.
The Buzz: Can you talk about the different modes of camping here? Obviously, you have the motorized. You have the trailers.
DO: I think that's the interesting part about our market. I mean, the US is 90, 95% towables I guess. We have a trend. We used to be towables in the majority in Europe as well. Motorized started in the 70s. We’re forecasting 187,000 [camping] units for 2017, and about two-thirds will be motorized.
The Buzz: Now, what do you find in the clientele? How has that changed in terms of the people who are buying?
DO: To be honest, not so much. I mean, our main target group used to be, not baby boomers, but people that have time that are 50+, or retired already. And it's still the biggest customer group I would say, but [in that last] one, two years, we've had an increasing amount of families come in. Then millennials. But it's not like in the US where millennials contribute a lot of the growth. Here in Europe, it's still, especially in Germany, on a small basis.
The Buzz: Now, how does that reflect in the base? Because one thing the RVIA does in the US is lobby for legislation. Now, the thing is you're dealing with multiple countries and everybody has their own rules.
DO: It's a nightmare. I mean, we are in the European Union, right? It's 27 member states and most of the regulations are put forward through Brussels or Geneva. Every member is to implement the regulations. And normally, they do it in a similar way. But trust me, there's still many, many complications because there's always that little bit of leeway. You could interpret something a little bit in one direction whereas another member does it another way and you're like, "Woah, this is totally different."
The Buzz: But how do you relate that to the manufacturers? I mean, obviously, the manufacturers are all around Europe as well.
DO: Well, I think, at the moment, our main concern or our main problem that unifies us all is the driver's license.
The Buzz: I have talked to people in China how theirs works. But how does it work in Europe in terms of what you can do. Is it total at six meters like China?
DO: No, it's not related to length. It's related to what's called 'tear' weight or you call it 'gross vehicle or ton' weight. If you get the normal driver's license, which the majority of people get, it's called the B class. And so this one allows you to drive a car up to 3.5 tons. That’s not much, especially if you're thinking of all the environmental issues, and if you have to put in some passenger safety issues. The vehicle itself, the chassis by itself, gets heavier and heavier with each model.
The Buzz: Because people want more stuff on it.
DO: People also have to have more stuff because of the regulations coming from Europe. Like airbags, an ESP, and these passive safety devices, or functions. Then also our customers they want more comfort. They want to have more appliances in the vehicle. That also contributes to a gain of weight. So manufacturers have to fight this by being ever more inventive in terms of reducing weight. So lightweight is a big issue here.
The Buzz: How does it affect the price point because, obviously, the more stuff you put in, the more pricey it gets.
DO: It's getting there. It increases but it's okay. At the moment, if you look at a motorized, the average retail price would be 70,000 euro, which of course every year increases a bit little by little, but it's still within, I think, the tolerance of the buyers. And they understand. [It’s like] “Okay. Now, I have this vehicle and I want 'this and that' in terms of comfort. And I do want to have really nice furniture flaps, and the fronts that look nice from the outside but also from the inside.” I mean, different story in the States, right?
The Buzz: Well, the biggest thing that I don't see here -- has to do with the campgrounds as well as the slideouts.
DO: Slideouts never made it to Europe. I mean, of course, now with LCI, we have a company and also a CRV member that is trying to push for that. We've seen some implementations already. But yeah, our issue is space. Space on campsites and campgrounds. And what we have-- I'm not sure if you have it in the States -- but we also have these pitches. We call them motorhome pitch basically. So we can drive up to a vineyard and park your vehicle there. And then you maybe you stay there for free as long as you consume there but normally we always have limited space there. So it's not like the big wide opens that you have in your national parks that's all on campsites. Everything is a little more tight especially in Europe. Italy, you know small streets and also small parking lots and if everybody starts putting out their [slideouts]. And also in the past, we've had-- this is maybe not the problem anymore -- but we’ve had some issues with water [intake and filtration]. But that was in the past. I'm very sure that's under control now.
The Buzz: And electricity.
DO: Electricity is not a problem. LPG, also no problem. I mean, the standards are different in the U.S. than in Europe but the big difference is the toilet system because that is in basically every vehicle here, apart from the liners. They have tanks like you in the U.S. So that's a big story.
The Buzz: The one thing I did hear is that the people are not dry camping as much as they used to. You were talking about they could go into the vineyards, just stop there and do that but now that seems to, not be a thing of the past, but it's moving away, where people want to be hooked up. Is that true?
DO: Well, you will be hooked up at vineyards because we'll make sure that you have at least electricity. That's the most important thing but normally that's the case…electricity and water.
The Buzz: Because there's so many different manufacturers, so many different places, can you talk about how CIVD helps navigate that?
DO: Well, Germany's by far the country with the most members and with the most industrial output. I think this year we will have 110,0000 units produced with many brands over three or four larger groups. It is very consolidated. But it is even more concentrated in the U.S. where you have only two or three big players now.
The Buzz: Two or three big players but then you have all these artisan people coming in trying to do their own thing that is making them adjust versus having the large manufacturing lines. That’s where the tricky part of it is.
DO: I think the smaller outfits are not an issue here. I mean it's hard enough for the big ones to get through the market. It doesn't really offer much space for smaller ones. I mean, purchasing power is must not be underrated and that's why the big groups, they reap benefit from that.
The Buzz: Can you how the manufacturers integrate at a show like Caravan Salon?
DO: So with an exhibition like this…we are the not the host, the trade show organization [Messe Duesseldorf]. They are basically operating it for us. But all the brands, all the shows, all the members, we bring them here together. The location here is quite nice because it's very central in Germany and close to the Netherlands, which I mean, used to be very important.
The Buzz: With a show like Hershey, it is mostly consumers and you have a little bit of industry while the RV Industry Show in Louisville is completely industry.
DO: We have a mixed situation here. I mean, on the one side, we have all of Hall 13 and a little bit of 5 where we put all the industrial suppliers. If you go there you will see all the higher management R&D guys of each manufacturer browsing through the halls, making appointments, so we have it split. So higher management, in the back of these guys, they take care of industrial talks. They talk to the suppliers. On the other hand, we also have a lot of dealers here.
The Buzz: I was wondering how the dealers work here at Caravan Salon. The thing is in the U.S. you'll usually not have the actual manufacturers there. You have the dealers talking to the consumers.
DO: Some of the manufacturers have slots, which they either give away to some dealers or I think some even sell them to some dealers. Some bigger manufacturers have maybe a 100 dealers here. So one part of the company only takes care of industrial issues and negotiates buying new things, and then the other part takes care of the consumers, the customers. So we have a very interesting melting pot here. You see basically everybody from CEO to dogs (laughing) because people bring their dogs. Yeah and customers, and that is I think a unique situation.
The Buzz: Can you talk about the customers because the thing is I'm seeing the people browsing? I don’t see as many prices.
DO: We have regulations. There’s a European harmonized regulation. How to do the pricing. How to not mislead the customer. I mean, sometimes you see very big list price. Yes? And then very small…all the add-ons. And, even smaller on the bottom, you see the final sum of the vehicle. So that we want to prevent. We have to show the end consumer the final price of that specific vehicle that he's looking at.
The Buzz: Now, how does all this legislation work? Frank [Hugelmeyer of RVIA] and some of the governmental affairs officers actually have to go to Washington and pitch the stuff.
DO: [In the U.S.] in a comfortable position. You only have one government to convince. We have our own government, the German government, and then if we find consensus we have to convince Europe.
The Buzz: So the CIVD…
DO: CIVD is Germany based. It's only Germany basically because were the German association, but for many years we've been lobbying Brussels and the EU also through another function we have. And we also hold [as Germany] the secretary of the ECF, which is the European Caravan Federation, which is the umbrella organization for all industry associations. So yeah, not just by our function, but also because we're very closely marketed. We are, by far, the most powerful association. (laughing) I can say that with pride. We can manage to do some lobbying in Brussels, as well.
The Buzz: Can you talk about the evolution of Germany as a powerhouse in the caravan arena and how that's evolved from your perspective?
DO: I think the first caravan was built in the 1930s. And then, it increasingly gained momentum, and then more players started producing these vehicles. Most of them came from the woodworking industry, so it's not really so much automotive. It's was more woodworking and then how do we get this on wheels? And that was the industry. And in the '50s, and especially after World War II, the people were looking for freedom and they wanted to travel. They wanted to see the world. They wanted to leave all the hardship of the past. So they started traveling over the mountains with caravans. And I think up until the '50s, there was a big growth in terms of totals. And then, I think, yeah, it was Mr. Hymer who started building motorhomes. And after that, I mean, the whole motorized units became a success story. But it was only a few years ago when we started selling more motorized than towables. And the trend now is definitely heading towards motorized.
The Buzz: What surprised you most about the growth of this industry in Europe?
DO: At the moment, we’re in the seventh year after the financial crisis of growth, but what surprises me, in a positive way, though, is that it's very strong. It's not just on a small scale. It's actually really getting more momentum. Of course, there are these factors: demographics and economic growth as well as some issues in Turkey and North Africa maybe benefit us too. In general, I think, for me, what is surprising is that we, first of all, managed to make it popular. I mean, caravanning or camping or RVing is now popular. And it's growing faster than I would have expected. So yeah, sometimes all of us are a little overwhelmed.
A graduate of New York University's Tisch School Of The Arts with
degrees in Film/TV Production & Film Criticism, Tim has written for
magazines such as Moviemaker, Moving Pictures, Conde Nast Traveler UK
and Casino Player. He enjoys traveling and distinct craft beers among
Make Sure To Check Out:
Caravan Industry Association [CIVD], which has been representing the interests of manufacturing industrial
companies in the caravanning industry for over 55 years. It counts among
its 138 members almost all German and European
manufacturers of caravans and motor caravans, along with their suppliers.