Caravan holidays remains strong, but a slowdown is on the horizon

An aerial of Caravans and cars camping on Perlubie Beach, Streaky Bay, South Australia

By James Harrison

A six-monthly analysis of Australia’s caravan industry demonstrated significant growth across the board, with tinges of a slowdown on the horizon.

Caravan Industry Association of Australia’s Business Conditions Report for January 2023 showed the strength of industry in the face of increasing challenges.

The Business Conditions Report dived into Australia’s continued love affair with the RV and Caravan lifestyle, which picked up real momentum during the pandemic. Current economic conditions are acting as protective factors for the industry with tightening household spending limiting international travel, a trend that is expected to see domestic travel remain strong.

The strength in the industry is evident by the growth in the number of annual caravan and camping trips in Australia overtaking the 2019 levels, with 15.1 million trips and 60.1 million visitor nights recorded at the end of 2022.

Multi-generation family sitting and eating outdoors by car, caravan holiday trip. (Source: iStock/Halfpoint)

Caravan Industry Association of Australia CEO, Stuart Lamont, said: “This is a significant milestone for the industry, as it is the first time that the caravan and camping visitor economy has surpassed 15 million trips and 60 million nights. These impressive figures not only reflect Australians’ enduring passion for caravan and camping but also demonstrate the industry’s collaborative efforts in providing diverse and tailored products and services.

“The caravan and camping industry have faced a challenging operating environment in 2022, like many industries around the country, the escalating cost of doing business due to inflationary pressures, labour shortages, and supply chain disruptions, resulting in an upsurge in material costs, overhead expenses, wages, and overtime pay, prompting businesses to increase their average selling prices. Despite these challenges the industry has continued to grow and push back against the tide.

“We expect the next twelve months to remain complex for the industry, with a tight labour market and unemployment rate at just 3.4 per cent resulting in increased wages and robust consumption activity.”

While striving for continued growth the industry stands ready for more uncertainty, the Australian government’s strategic trade diversification, including exploring new markets in India and solidifying the Australia-Europe free trade agreement in the second half of 2023, presents new opportunities to diversify the industry’s supply chains as well as open new international markets.

Businesses across the industry share the sentiment from the broader community with concerns regarding financial, industry, and consumer sentiment. This is leading to caravan industry businesses expecting a slight weakening of the economy in the next six months. However, with businesses adapting to the current situation, there are still opportunities for growth and success in the caravan and camping industry.

Featured Image: Perlubie Beach, Streaky Bay, South Australia (iStock/Mackenzie Sweetnam)

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caravan Caravan Industry Association of Australia Caravaning Stuart Lamont