By James B. Kelleher
CHICAGO, Aug 16 (Reuters) - Recreational vehicles will still find buyers even though turmoil on Wall Street has shaken U.S. consumer confidence, U.S. motorhome maker Winnebago Industries Inc. (WGO.N) chief Bruce Hertzke said on Thursday.
In an exclusive interview with Reuters, the CEO and chairman insisted Winnebago wasn’t feeling an extra chill in the current stock market correction, nor was he worried about it hurting the already weak RV market — even though the pricey products are discretionary purchases.
“We’ve had a lot tougher times than we’ve had right now,” Hertzke told Reuters. “They’re not great times now by any means. But we’ve seen worse.”
Indeed, Hertzke suggested the volatility in the stock market might be good for business. Some investors apparently agreed, sending Winnebago shares up as much as 5.7 percent even as the broader market bounced up and down on Thursday.
Winnebago closed the day up $1.28, or 4.7 percent, at $28.35 on the New York Stock Exchange.
“I don’t think we’ll be a major area that gets hit,” he said. “With the people we sell to, these are discretionary dollars, and these are people who are saying, ‘I better figure out what I want to do to enjoy the rest of my life.”
“‘It’s trying and taxing enough watching that stock market go up and down and feeling really good for a month or two and then feeling really bad. I better figure out how to spend my money to enjoy it,’” he added.
But Hertzke said he thinks the U.S. Federal Reserve should cut interest rates quickly — and not just because it would help the RV business, which has endured two years of lackluster sales because rising interest rates, higher gasoline prices, and flat to falling home values have all hurt consumer confidence.
“I think they ought to cut it a couple quarter points to see if they can get things stable and headed back in the right direction,” he said.
“It’s more for the housing industry, to see if they can’t save a few more people ....”
((Reporting by James B. Kelleher, editing by Richard Chang; Reuters Messaging: email@example.com; email: firstname.lastname@example.org; +1 312 408 8130))
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