CEO Of Erwin Hymer Group Talks Building Trends & Infrastructure That Is Motivating The Industry At Dusseldorf Confab
The Erwin Hymer Group is one, if not the largest, caravan manufacturer in Europe with 22 brands under their belt serving a wide range of different lifestyles while still encapsulating everything from technology, insurance, financing and even renting. EHG CEO Martin Brandt sat down with The Buzz at Caravan Salon in Dusseldorf, Germany to discuss buying trends, manufacturer builds and the caravan lifestyle.
The Buzz: Can you talk about how the motorhomes your conglomerate manufactures reflects the European camping and caravan lifestyle at this moment?
Martin Brandt: In Europe, it's a little bit different when you compare it to the US. The US is a very caravan driven market. In Europe, we have three different kinds. We have a caravan. We have a motor caravan. And we have camper vans. They're converted vans. Really the most drawing segment at the moment is the camper van in the market. We are growing at a pace of around 50% per year. The market itself in Europe is also growing.. But, I mean where the Erwin Hymer Group are financially-- at end of August, we have grown in number 38% to last year.
The Buzz: And that's across all the different brands?
MB: Yes. We have in total 22 brands. But in those 22 brands, we not only produce and sell motor caravans. We try to cover the whole process. So we finance from a dealer and customer [perspective] also. We have our own bank. Together we've FCI Bank. We have a rental company. We are Europeans' largest rental company in RV. We have around 120 stations around 3,000 vehicles.
The Buzz: How is that evolving? The rental market here versus the buying.
MB: The rental part is growing. For us, for rental, of course, is how to attract new customers because this is the starting point. When people think about camping and everything -- they don't want to buy in the first stage. They rent and then they buy. This is the reason that it's very important to have this rental up. By the way, the biggest growing side in rental for us is in Iceland (laughing)
MB: We have 12 brands when it comes to motor caravan, caravan, and camper vans. And why we have so many – [is that] we have totally different target groups. We have totally different price points. So what we usually do is –- the market is to buy in three parts. We have entry level, the mainstream, and then premium market. So that goes from, let's say, 40,000 euro up to 300,000 euro. And then another dimension is we have families. We have singles. We have two together. We have a dog, etc. And our brands are dedicated to these different target groups. So one example is a family. We lay out by doing to suit families. So this is how we divide the brands up.
The Buzz: Especially with families and all of this, they want more amenities. They want more things in the motorhome to be able to do, but you also, compared to the US, have to keep the weight down. Could you talk about sort of the push and pull of that and where innovation has to come in at that point?
MB: Yeah, this is a problem because for the traveling license, we have this 3.5 tons. And, of course, if you bring things in, if you have innovation -- we talk about hybrid technologies. So everything has to be lightweight. It's very important so we use special material. We use lightweight chassis, but we save weight on the material. We try to get innovation, design, different materials to keep the weight down. When we develop a new product, we have a calculation not only on target cost, but also on weight. So in the development, the weight is calculated and if we see we are above the 3.5 or whatever, we go again back and make a new construction.
The Buzz: The one thing I've seen which is different than the US is obviously a lot of storage in a smaller space. Could you talk how that works, especially for alternative vehicles.
MB: In the US they buy a modal caravan and they very often stay inside a modal caravan. In Europe, you buy it, you go to Italy or Spain, and you are more outside. So you need your equipment to be outside. And if you have a caravan you can park the caravan, you have your car, and then you can drive to the cities. In a motorized caravan, when motor caravans stay on the site, [what the customer does] is they take bicycles with them or even a motorbike, to be more independent. The trend now is on the E-bike. But even with e-bike and everything, we design motor caravan that it is below 3 ton. So usually it is 2.8 or 2.9. So you have additional 600 kilo to load.
The Buzz: How have the spending habits evolved in, say, the past five years, considering more people are traveling, touring, and doing that? Does it affect the kind of models they're buying?
MB: Ah, what kind of models. Okay. Yeah. So there's a trend-- it's very interesting. In a caravan, the trend is more to bigger and longer in a caravan. Three years ago, we thought it goes more to smaller ones, but on caravan, it goes to bigger ones. On motor caravan, it goes to smaller ones. I think the reason is, the caravans are very [much being] used by families, let's say with small children. And they usually, they go to a camping site and stay there with a camper for two or three weeks or whatever. So they need more space, they cook, and so on.
The Buzz: So do they stay close?
MB: They go to Italy, Spain, or they go to Sweden, Scandinavia. These are the two [kinds of places]. And with a motor caravan, the trend is more to compact. And the motor caravan, in the past, they drove long distances, like the caravan and stay for three or four weeks. That has changed. So the motor caravans now, we don't use it only for once a year for a holiday. We use it for a weekend trip. So we drive not long distances. It's shorter but more often. So we go to the mountains for mountain biking or for just walking. Or sometimes let's say we go to Munich, stay there overnight, go shopping, and then we go to a lake outside the mountain. So the usage has changed a little bit.
The Buzz: Can you talk about the way people are looking at caravans now? And how they will evolve from your perspective?
MB: So we did a survey…a customer survey. And it becomes very clear that digital is important. One example is Wireless LAN. Do I need Wireless LAN in the car? I thought no because our customers are 60 years, 70 years old. They don't use it. Totally wrong. 77% said, "I would like to have Wireless LAN in my car." Why? "Because we would like to have a connection to our grandchildren and every kind of thing”. So this is a thing. So a trend is clear. Wireless LAN. Then another trend is clear when they said, "Okay, with a smartphone, I would like to see how much more to drive? And how much gas do I have?" And so this is a more comfort thing, yeah? And, "We don't want to know 40 liters. We want to know how many kilometers”. Two days or whatever. So this is intelligence we have to provide. And another example is in the back here. We have “Free Our Tour”. This is a platform for our customers. In the platform, they can plan their tour. So they say, "I drive now from Frankfurt to Hamburg and then to Berlin." We do the planning. We do a calculation. How long it takes. [It talks of] some sites where they can see something. Where filling stations are -- but now the good thing comes. You do your plan and then you can automatically [submit the] root planning into your navigation system.
The Buzz: One-stop shop?
MB: One-stop shop. And these are the trends to make it more comfortable for user.
The Buzz: The big thing in the US, people want to be connected but they want to be able to enjoy nature and be unplugged. Can you talk about the balance of that here in Europe and what people want to do
MB: They really want to be connected but, of course, one wants to have freedom, to drive. And in Europe, you can usually stay wherever you want. You do not have to go to camping site. You can but also you can park. So if you drive and you're on a mountain, you can stay there overnight. This is not a problem.
The Buzz: Which it is an issue in the US…
MB: Yes, I know, I know. But in Europe, it is not. We have freedom. But we would like to have both.
The Buzz: The aspect of you having been here and done all you have, what are you most proud about within both your company but also with the caravan industry as a whole
MB: We have now in the last three years doubled our sales, okay, and doubled our number of caravans we have sold. We are now on 2.1 billion euro and we have sold 55,000 units. And I think we are proud of it because in such a short period with our employees, that was really for our whole organization, a really strange thing. So we have very good employees. We do it in our factories, so we work overtime, we work Saturday, we're working shifts to do all this kind of thing. I think that is something we are really proud of.
The Buzz: But also people want customized elements. How much does that go into it?
MB: Usually, they go to a dealer and they say, "We would like this and this," and we do it in our factory.
The Buzz: And is that mostly through the Internet? Is that why you think it's risen? That doubling.
MB: Absolutely. It has different reasons though. One reason is we have a baby boomer generation born in '60 or late '50s, so they’re now coming to retirement. They have money and they have still the boost. But now they would like to have the freedom but more comfortable. This is one thing. The other thing is that in Europe, we have a problem. You can't travel to Egypt. You can't travel to Turkey. You can't travel to Tunisia. People, because of terrorists, are afraid to go to a plane. So there's a clear trend to stay in their country and make holidays in their country.
The Buzz: But they feel safe in western Europe?
MB: Yes. Many people like to stay in Germany and when they buy a caravan and travel around, they feel safer. So there are a couple of trends that come together and that make this boost.
Tim Wassberg
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 other things.
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Erwin Hymer Group, which oversees 22 strong brands and the most extensive partner and service network in the industry making touring an unforgettable experience for their customers. Their spectrum ranges from affordable entry-level models to comfortable luxury class vehicles.
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