Ensuring the successful future of an RV business sometimes means contemplating a merger. That process can require patience, as well as letting go of an existing paradigm to create something new.
Ted Davis, founder of Airstream Adventures, said further growing his business has been on his mind for several years. He recently sold the company’s six dealerships to Lithia and Driveway, a nationwide automotive dealer. Lithia and Driveway, headquartered in Medford, Oregon, is a publicly traded firm with 300 automotive stores across the country.
Davis founded Airstream Adventures, Airstream’s largest RV dealership, with partners Parker Johnstone and John Dimmer 12 years ago. The dealership’s head office is in Portland, Oregon.
“As a founder, you have a lot of attachment,” Davis said. “It is not a decision that you wake up one day and say, ‘I am going to sell.’ I like to work through the strategies and create a pathway forward. You say, ‘what does this look like? How does it allow myself and my partners to accomplish our goals, but more importantly, and it took me several years to figure this out…, how do I create a path forward for our team members, a path forward for our guests? Also, what would a perfect partner look like to make sure we are setting them up for a successful path forward?’”
Davis said it was necessary to disconnect from the personal aspect of his business to think strategically. The process took time, he said.
Davis created a perfect business partner profile. He said he wanted a partner who understood operationally how to run the retail side of the business, one who shared his business’ core values and wanted to be an Airstream brand steward.
Not having to sell the Airstream Adventure dealerships at a certain time or at all gave Davis the time to wait for the perfect match, he said.
“The obvious choice was Lithia, from the footprint they have nationwide, to their operational expertise, to the technology they possess and utilize in their dealerships,” Davis said. “That made for a really good match, being two homegrown Oregon dealerships, and Wally Byam (Airstream’s founder) being born in Oregon on July 4. It made for a good all-American success story.”
Davis said he respected Lithia’s operations reporting and transparency, which help dealers continuously improve their operations. Improved operations ultimately result in guest satisfaction and retention that will help Airstream Adventures grow its brand, Davis said.
The path to partnership
During the pandemic, Airstream Adventures discovered consumers needed a way to buy RVs without coming to the dealership.
Airstream Ad
ventures created an “online configurator” helping consumers to configure, create specifications for and submit a factory order to the dealership. Once an RV came in, Airstream Adventures could contract with the consumer and deliver the RV to their home, Davis said.
The dealership’s online process was an Airstream Adventures aspect that caught Lithia’s eye, said Ted Dobry, Lithia and Driveway VP, Strategic Operations. The two companies had “synergies” as well as their Oregon location in common.
“The automotive industry is moving more into online sales, or at least, more consumers are starting their purchase journey online,” Dobry said. “Ted’s business is doing absolutely the same thing.”
Lithia was looking to diversify beyond automotive dealerships and the Airstream dealership fit the bill. Airstream Adventures offered an attractive return on Lithia’s investment.
“The Airstream brand is a very desirable brand,” Dobry said, “and in this case, the geographic location lined up so well and we have a lot of existing resources to realize our existing synergies.”
Going Forward
The merger has been nearly seamless so far, the executives said. Lithia is ensuring the transition is not disruptive to the Airstream Adventures team members and guests, Davis said.
Lithia’s software and technologies will enable Airstream Adventures to continue to grow, especially in terms of the online portion of the business.
“It is one thing that really excites me,” Davis said. “… the massive support that they have in their corporate offices and around the country.”
Lithia will share in-house proprietary marketing software solutions with Airstream Adventures. The solutions will speed up, automate and target marketing efforts, Dobry said. The Airstream Adventures team will continue to run the business with a high degree of autonomy.
“We are unique in our space, because we run a very decentralized business model,” Dobry said. “This allows Ted and his team to stay with the stores and run the business the way they want to. We are very hands off.”
Companies under the Lithia umbrella usually retain their own names. Names typically mean a lot to their local communities, Dobry said.
“We embarked upon this adventure together because we think there is more potential in this industry,” Dobry said. “We look forward to learning from Ted and his team about those other opportunities. We do believe there are synergies between his business and our business and we look forward to realizing those and seeing what other opportunities are available in the RV space.”
