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Old 08-27-2012, 10:13 AM   #1
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Thor president resigns to start "Airstream 2 Go LLC"

Thor Industries Inc. announced that Richard E. Riegel, senior group president, has decided to leave the company to found a new business, “Airstream 2 Go LLC,” which will rent current model Airstream trailers and tow vehicles to consumers and commercial customers.

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Old 08-27-2012, 10:41 AM   #2
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Interesting. Renting travel trailers is an underserved market in general, it seems that the vast majority of rental RVs are motorhomes.

I wonder if this will be good for Airstream in that more people will get a chance to try before they buy (if they want to.) I also wonder what sort of astronomical rates they'll charge!
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Old 08-27-2012, 11:31 AM   #3
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Several years ago Airstream worked with several campgrounds to supply them with 25' FB's specially designed as a sort of park model (emphasis on "sort of") and that effort seems to have been less than successful. We saw the 25's in Las Vegas at the CG next to Circus Circus and at the KOA on the way to Key West. I didn't see anyone renting the Airstreams at these CG's when we were there. I can't recall the exact nightly fee in Vegas but I was surprised how high it was.

Why would Reigel give up the lucrative corporate post for such a risky business? Was he eased out with a promise to help him with a new business? Was he bored at Thor?

Now that he will be an Airstream consumer, I wonder how he'll feel about Airstream QC?

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Old 08-27-2012, 11:40 AM   #4
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I think this is a good move! He is the prefect person to run the rental co with this Airstream experience, and he is bound to provide useful feedback to Airstream. I bet it will be a win-win.
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Old 08-27-2012, 12:25 PM   #5
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I think this is a good move! He is the prefect person to run the rental co with this Airstream experience, and he is bound to provide useful feedback to Airstream. I bet it will be a win-win.
Now that IS an interesting possibility I hadn't thought of. A big corporate customer run by a former insider might get some attention about quality and component issues. Of course, the way the production line works, they might just do extra inspections of the units being built for airstreams2go...
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Old 08-27-2012, 12:49 PM   #6
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It will work if there are people willing to pay more for an Airstream... and as there are people who BUY them for a lot more, there is at least a chance.

The issue I see is that with other rental companies, they buy low-buck units, beat on them for a couple of years and sell them before much is worn out. They don't loose too much on their capital, as the units are cheap to start with.

When you buy a $50,000 trailer (or more), there is going to be an expectation of quality that might be harder to meet/maintain with a rental unit.

I also wonder what this will do with the used market, as in a few years you would expect this rental fleet to start releasing units for sale... an extra 50 used Airstreams on the market each year is a big deal.

Given the tiny Airstream distribution/dealer network right now... I can't see this being very big...
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Old 08-27-2012, 01:13 PM   #7
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I suspect that they may rent some of them to the more well-feathered European tourists, the same ones who come over with the plan to rent a Harley or a Ferrari.

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Old 08-27-2012, 01:27 PM   #8
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Jeeez... I wonder what he was up to to, to deserve such a fate
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Old 08-27-2012, 01:36 PM   #9
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Renting units that are in place for the night is a lot less risky than renting a truck with a trailer to people, who have never pulled a trailer. Dickie should have a lot of money from when Pete bought out the 50% of Thor stock when Wayne died and all the money went to Wayne's estate and beneficiaries (including Dickie and his wife, who was Wayne's daughter). The new venture is an LLC, which might mean that there are others involved. Having lots of money in the banks right now is not drawing very much interest.
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Old 08-27-2012, 01:37 PM   #10
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Maybe a good test ground to develop a more 'rugged' trailer?
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Old 08-27-2012, 02:18 PM   #11
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Riegel believes he has found a way to expose the Airstream mystique to the masses. This will be an interesting gamble.

There is a reason why those in the RV rental business only rent the smaller Class C motorhomes vs. a long trailer or high fifth wheel. The small Class C is easier to handle.

I would imagine their rental contracts would be akin to the rental of high-end automobiles; there would be a substantial damage deposit. I shudder at the thought of the kind of damage the exterior shell will be exposed to at the hands of an inexperienced driver trying to back into a small site. Isn't it something like 2k just to replace a dented/scratched panel?

Given the tiny Airstream distribution/dealer network right now...
If the rental experience is a positive one, will they become Airstream owners? Perhaps. "Positive experience" are the key words. That first trip is seldom a positive experience for the neophyte, especially if "x" doesn't work or they can't figure out how it works, or they have broken it trying to get it to work. Driving a trailer the first time can also be nerve-racking, to say nothing of those other issues that pop up on the road.

Will Riegel be offering the used units to the dealers for resale or selling them via his parent company like Budget Rent a Car? Maybe he is thinking the rental gig is just a lead into the used Airstream market? This is where I can see the potential, particularly with the retiring baby-boomer demographic who want to buy into that mystique.
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Old 08-27-2012, 02:23 PM   #12
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The word "commoditized " comes to mind.
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Old 08-27-2012, 02:26 PM   #13
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The word "commoditized " comes to mind.
I can honestly say that word did not come to my mind.
I didn't even know it existed.

Ken
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Old 08-27-2012, 02:41 PM   #14
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I just can't see the economics of this working. I have a certain client that always bases how much product will need to be sold to pay for a building improvement. I think the same theroy can be applied here.

Working backwards in extremely simplified numbers:

Goal: Profit $100,000 per year.
Need sales (rentals) to do so: $250,000 per year (roughly $1,000 per day)

Approximate rental fee ($250 per day ?)

Unit cost (Truck and trailer good for 4 years):$80,000 ($60 per day)
Unit Expenses (maintenance, insurance, whatever...): $40 per day (WAG)

Profit $150 per unit per day.
Assume 66% rental rate

So, in very basic terms, if you could keep a fleet of 10 airstreams/trucks rented 5 days a week, you should be able to take home about 100k a year. If you work alone. If you work every day. If you have a spare one million to finance the company for facilities, equipment, marketing, and on and on.......

I didn't factor in resale in 4 years, but let's just consider that gravy! Realistically, start adding in employees and this sure sounds like tight idea.

With that said, if a CEO has the courage to present an idea like "Airstreams to Go", he obviously has done his homework and market research. I'd love to see his business plan, or maybe this is just a wishful hobby business? Maybe folks will pay $600 per day?

Good luck to him, I suspect the "salvage title" market may have an increased inventory soon though!
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