I predicted this year would see the demise of several RV manufacturers including Country Coach, Fleetwood and Monaco along with other smaller companies in "RVIA blindsided by bad ecomomy."
Last week we witnessed Country Coach file for bankruptcy as well as Rexall Industries.
Fleetwood is flailing in the wind and today announced it would no longer honor it's limited warranty on it's products that were not purchased directly from an authorized dealer.Today we learn that Monaco Coach Corporation, makers of the brands Holiday Rambler, Monaco, Beaver, Safari, McKenzie and R-Vision is on the brink of collapse (no surprise to RV Now readers). A company press release says they handed out pink slips to most of their workers who have been on furlough since the middle of December. Can bankruptcy be far behind? I think not!
Meanwhile the RV Industry Association continues to play the violin as Rome burns. All the hoopla about increased RV show attendance and high paid executives saying things like, "I've seen downturns before, we survived it then and we'll survive it now..." turns out to be nothing but hot air or wishful thinking at best.I warned all my readers this was going to happen more than a year ago. I told you to get your RV warranty work done before you RV manufacturer or dealer went out of business. I told the workers of RV plants to start looking for different jobs. Even with all this prescient analysis I was ridiculed for my opinions and predictions. I didn't loose any sleep over it, in fact, I slept better because I did my part to help RVers and RV workers know what was over the horizon.
My thesis is that only a handful of RV manufacturers will survive this economic depression. I'm now beginning to doubt whether ANY RV manufacturers will survive given the cascade of negative economic analysis I see every day in my research. For my detractors who doubt my analytical skills, it may surprise you to know I have more academic credentials than most of the economists who failed us so miserably by not being able to see this coming. In fact, in my opinion, this financial crisis is a huge black eye to the science of economics. I can count on one hand the number of economists who knew this was coming and warned us in advance.
The good news is that Americans love RVing and even if every RV manufacturer fails, new companies will arise to take their place at a future date. In the meantime, we have plenty of used RVs to enjoy and plenty of great places to explore.
With my hand on the fading pulse of the RV industry - Jim Twamley, Professor of RVing
37 comments:
Jim:
I am now what would probably be termed a "full-timer." However, I came to RVing quite by accident. My job (that I started about 18 months ago) requires me to travel a lot. I don't know if it is the most economical way of traveling, given the alternatives; but I feel good about my choice, overall.
One of the things that someone like me looks for in an RV is a desk to work at. Many others in my situation use their dining table as their desk, but I would rather use my dining table for dining. I see so many coaches that have two couches. Rarely do I see one that can even be modified easily to use a makeshift desk (with enough room for a laptop and a printer).
Perhaps you could pass this information along to the manufacturers. There are several of us in the construction and related industries that would benefit from a design change to fit our needs. In the past, RVs were built with recreation in mind. But going forward, with all of the infrastructure building that will take place in the next ten years, along with Baby Boomers retiring, a desk would be essential to modern living.
I have been looking for a good coach that meets all of my needs, and as prices continue to drop, I will keep looking for one.
I am disappointed to hear of Rexhall, but not surprised. My plan was to buy on of their fine looking coaches when I retired. Can you provide a link to the news for Rexhall?
Gene S.
Thanks for your unbiased opinions. I believed you back in Fall and am unsurprised to see what you predicted come to pass.
Unfortunately, the bad economy has also ruined my husband's and my plan to RV for a year. It's disappointing.
Here is the story as posted by Greg Gerberon February 26, 2009 13:27
LANCASTER, Calif. -- Motorhome manufacturer Rexhall Industries filed for Chapter 11 bankruptcy protection yesterday, RV Industry News has learned.
The company claimed total assets of $5.1 million and total debts of $4.9 million. Chapter 11 allows businesses to reorganize by restructuring debt so they can get out from under burdensome leases and contracts. Usually, businesses that file Chapter 11 are allowed to continue to operate, although it does so under the supervision of the Bankruptcy Court and its appointees.
Attorney Steven Fox has been retained to represent the company. He can be reached at 818-774-3545.
During a special meeting of Rexhall shareholders Feb. 4, it was decided that Chapter 11 was the most beneficial financial and legal alternative for the company, according to documents filed at the U.S. Bankruptcy Court for Central California.
Posted in: Manufacturing News
Thanks for your comments. Well run companies will survive. It is time for the execs to cut back on their perks and live like the rest of us. Rvers know how to budget. So should the companies.
It's not just people in construction type industries who would benefit by a desk in their RV. More and more people are developing internet businesses, and they can run their businesses wherever they can get a internet connection--which is becoming easier and easier.
As for the demise of the RV industry, yes, it will recover--eventually. But to woo buyers during these difficult times, it could also turn back the clock and make more economical units like the Toyota class C's of the '80s. Keep them gas efficient and price them low. If it weren't that some drunk driver clobbered my '84 Toyota Dolphin a couple of years ago as it sat in my driveway at 3:30 a.m., I would still be happily driving that little gem.
Monaco just filed for bankruptcy too. That wipes out a bunch of long time brands.
Your like Fox News. You just tell it as you see it and nothing wrong with that. No sense sugar coating what can't be sugar coated. My heart goes out to all the folks that are now jobless because of the down fall of these RV industry.
itchy-wheels....
If you want to be taken seriously, please proof-read and spell check your blogs. Thank you
As those of us with Military, Fire and/or Nuclear experience behind us have known for a long time, If you study and accept the worst case scenario and plan to place yourself in a protected location despite whatever comes, then when something less than the worst case scenario comes along, we don't worry, and we remain able to survive.
We need people telling the world the truth! we don't need someone telling us that if we give them all our money, they will create 4 million new jobs. We need to know that the economy of the WORLD will look significantly different next year, two years from now, and ten years from now. When the fuel prices broke last summer, we all said "gee, I glad that is over" and when Housing, Banking, and all Industry have broke in succession, we have said "gee, we can hold our breath till this passes". THIS WILL NOT PASS! OUR ENTIRE SYSTEM OF ECONOMICS WILL COMPLETELY CHANGE AND NO ONE KNOWS HOW, WHEN, OR WHERE IT WILL LAND.
Keep telling us exactly what you see, Jim.
SHvnDave
No Doom & Gloom, just realism
The RV industry is certainly suffering, but RV camping in southwest Florida certainly isn't!
I own an RV lot there and could have rented it 6 times this winter. I have friends traveling there now and can't stay in one place more than 3 days because the parks (some with 520 sites!) are full! The other thing I've noticed is the dealers USED to put all their big rigs out front for all the world to see - now they are showcasing inexpensive travel trailers and pop-ups!
Jim,
I enjoy your reporting very much and usually you are right on. How about doing an investigation on RV insurance options. I read in the Roadtrek group that USAA was not writing any new RV coverage. As one who has been with USAA for over 40 years and presently have my RV insured with them, I was surprised and a phone call to them confirmed the stories. What will the future be for us?
Hi Jim, I worked at the Sterling plant in St.Thomas Ont. Which will be closed March 27/09.The plant is moving to Mexico.I've seen this DOWN turn coming for ALONG time..but nobody would listen to me either...I have a 40 foot 5th wheel with all the bells and whistles and sure glad i bought back in 04..It's paid and i can live on easy street and watch this wirl wind of a MESS and sit back and laugh till they come knocking on my door and ask how can we fix this mess...I sit with alot of education and can't even get a job..o well thanks to RV's i don't ever have to WORK again..but would love too! IS JIM and I the only psychic????
I agree with John Pelley regarding executive greed as being a major factor of the demise of many RV companies. But let us not limit that condemnation to only the RV industry; American business, in general, has been overly generous with its executive corps while pinching the hourly and mid-management workforce to squeeze as much as they can for as little $ as possible.
Now these worker/consumers are out of work with little to hope for while the execs get severance packages that allow them to continue living comfortably.
Yes, perhaps ownership entitles those at the top to some extra benefits - that concept might explain why "Atlas Shrugged" (Ayn Rand's classic) is such popular reading again. But compassion and the desire for a clear conscience might (hopefully) cause some of those at the top to rethink their greed.
Perhaps the times are not ready for that yet but the time is coming when we must be more concerned about those around us rather than on the things we own. As the economy continues to fail, we will see what the true nature of the American spirit is.
Jim, keep calling a 'spade a spade'. Thanks for your continued unbiased input. D&L
Jim, thank you for providing readers with your honest reports about the RV industry. I've said many of the same things in discussions on forums over the last couple of years, and found that most RVers, just don't want to hear it and would rather play ostrich. I guess most of us have such huge money tied up in these things that we don't want to face what is happening to the industry. RVing will continue, but will be substantially different in the future, with smaller, higher quality, and more economical units.
I think that now would be an opportune time for some of the RV manufacturing employees that lost their jobs, to open service and modification centers. They could leverage their experience with the various brands to service, repair and modify RVs that they are familiar with. They could maybe even buy the part of the manufacturing facility at bankruptcy sales.
Jim, while I don't disagree with much of your original premise, most follow-ups are just "I told you so" pieces. While there are always bruised feelings from not "being believed", there's also a time to move on. If you really want to be on the leading edge of prognostication, now would be a good time to start writing about what comes next, with more content than "RVs will be smaller". It may also be a good time to find a better favorite word than "I" (count how many times "I" was used in this post).
Jim, thank you for your comments. We don't need sugar coated info. We always read your comments, and appreciate your candor.
Jim,
Keep calling it as you see it. You help keep the other media noise in check. The price / demand for new and used light-weight campers has been rising for the last several years. I heard last week from an excited Four Wheel customer that there was a long wait from order to delivery. I imagine the RV service industry, Camping World, and independants will prosper as manufacturers and dealers continue to fail. There will always be a market for large units too. Someone will survive with a different game-plan or a new company will rise from the ashes.
I think there could be a silver lining to all this if we end up with an "only the strong survive" chapter 11 scenario.
The only statement you made which I would question is your use of the term "the science of economics". It isn't easy to formulate equations accurate to the fourth decimal point in a field with so many variables. It is difficult for me to define any field where all the experts disagree as a science. Perhaps it is expressed best with the old one-liner that if you lined up all the economists in the world end to end, they still wouldn't reach a conclusion.
Jim,
APPRECIATE YOUR FRANKNESS. wE ARE SO GLAD WE ARE FULLTIMERS. wE CAN CONTROL OUR COSTS AND ENJOY LIFE.sO MANY OF OUR FRIENDS IN STIC HOUSES ARE MARRIED TO THEIR PROPERTY AND NOT DOING WHAT THEY ENJOY.
aS FAR AS COMPANY EXECS TAKEN HUGE SALARIES, i DISAGREE WITH THE CONCEPT, HOWEVER I DO BELIEVE EXECS SHOULD BE REWARDED FOR PERFORMANCE. IF THEY RUN A TIGHT, PROFITABLE COMPANY THEY DESERVE A BONUS BASED ON PROFITS...
I ALSO BELIEVE THAT COMPANIES WHO ADOPT THE ESOP PHYLOSOPHY,(EMPLOYEE STOCK OWNERSHIP PLANS), WHERE THE EMPLOYEES HAVE A STAKE IN THE COMPANY AND ITS PROFITS WHO HAVE REPRESENTATION ON THE BOARDS OF THE COMPANY WILL GIVE THEM A SAY IN EXEC COMPENSATION IS THE WAY TO GO.
I LAUGH AT THE POLITICIANS IN DC TELLING THE EXECS THAT THEY MAKE TO MUCH MONEY AND ARE NOT DOING THEIR JOB PROPERLY....THEY NEED TO LOOK IN THE MIRROR.
JUST MY HUMBLE OPINION.
TED n MIMI
IN SAN SIMEON, CA FOR THE WINTER
Jim,
this fatal economy is the biggest blame on the RV industry going downhill! I do, however, agree with your comment about executives bringing a lot of their downfall on to their own industry.
A Mr. Swlingman,(spelling) of Winnebago industries told me two years ago, " We could fix your RV problem for free, however, since you mentioned the FL. Lemon Law we will not, at least not for free"!
Again this was the top honcho with Winnebago in their customer relations department.
I know that with the years Winnebago has been in business they will be one of the last to go but if this type of service reputation continues, they also will be going.
Jim B
Jim, Agreed with yiu from the start, however I don't think they'll all go under. A few of the small ones, like Tiffin can survive. Since basically the whole town of Red Bay,Al. is dependent on Tiffin, I think they will be able to cut pay and hr back enough to survive. I sure hope so, they haven't been greedy like several of the big boys who have gone under.
I work in the RV industry. And I am very mad at you.
How dare you pull the pants of the RV industry down just as it's about to reach fourth base with a few remaining customers who aren't aware the warranty coverage will go "poof" as soon as the companies shut down?
How dare you take it upon yourself to insult unregulated free market economics and leveraged levers leveraging other levers who in turn leverage other levers?
Who do you think you are to criticize quality, fuel economy and at the same time INSIST that jobs should remain in the USA where greedy liberals and their unions tempt innocent Amish workers into joining their satanic groups in order to perpetuate the very crash we are seeing?
My solution is to move all blue collar jobs to Mexico and China. That way the dollar will stabilize and we can become a services based economy where all we do is consult higher and higher up the food chain until there is nowhere higher to go.
The fault is not with management, it's with greedy unions. No Toyota or Volkswagen plants in Germany or Japan have unions, that's why they succeed.
I also propose laws against freedom of speech so people like you are not allowed to cause panics and entire industries to collapse.
Furthermore, we need laws against all this "environmental" and "green" stuff that doesn't save ANY money and just costs more. We should have nucular powered hydrogen fuel cell RVs and the waste should be shipped to the moon because it would leak inside mountains. It would be more cost effective than the plug-in hybrid and carbon fiber crap the hippies want.
I blame Obama and his cabinet, Pelosi, and Reid for the depth and of and spiral downward of our economy.
A trillion dollar "stimulus" package packed with the pork that the left has wanted for decades? The stimulus package takes over 5 years to get the money spent?
A hard capital gains cut and deep tax cut for those of us who actually pay taxes would have stemed or weakended this "crisis", and perhaps the RV manufacturers would have survived. Instead our kids and grandkids will pay for this pork packed stimulus bill for most of thier lives.
Obama talks down the economy and up the "crisis" weekly, and wall street has voted no confidence in his policies.
I vote no confidence in his handling of this whole situation, and it will only get worse as they enact every last item on the left's wish list.
Personally, my wife and I have retired early just this month, and will fulltime. Our house is sold, all the possesions sold/donated, and we are now free Americans.
I am not staying in the higher tax bracket to give money to Obama, nor to those who pay no taxes at all.
My turn to relax and take the free ride - the new American way.
1. I appreciate your honesty. It is refreshing to know you are not "on the take".
2. The RV industry has priced itself out of business. It was very hard for us to find an affordable motorhome in our price and comfort range.
Not everyone is comfortable in a mansion 45 feet long with Mirrors on the ceiling, and walls is a little overkill.
Who really needs a Ralph Lauren interior? Other than Ralph Lauren?
Who needs 4 or 5 flat screen TVs in a motorhome?
Who needs a balcony?
3. Most RVers will probably agree what we really want is “quality” not quantity!
4. The suggestion to the laid off workers to start their own RV refurbish companies was an excellent idea.
5. Will Rogers said “You can’t break a man who does not borrow” Think the politician could learn that lesson?
6. And finally, I don’t think people who look and plan ahead are too surprised at the economy! Nor are they in trouble. Of course we all worry about the future but a lot of us plan for the future too.
Jim, You have been on the mark with your assessment of the RV industry. My wife and I would have bought an RV 4 years ago, but were turned off by the hard balling RV salespeople and their greed to get every last dollar. With a 30 to 50 % mark-up, you would think they'd be willing to make a sale with someone they new that did their homework. Now that things have turned south, the price I would have paid (and maybe even a little more) are now commonplace. We bought a Class B RV last year, and are very happy with the choice we made and the price we paid. It was our first RV, but should, in reality, been our second RV purchase.
I want to thank you, Jim, for your wonderful news letter (spelling intentional). I appreciate the news features very much, and have come to rely on your ads as well.
One of the things I am looking for, being new to RV-ing, is a small, economical-to-run, yet fully featured vehicle. I am also looking for a manufacturer who keeps green practices and their own workers in mind.
Thanks for helping us learn more about the industry, and especially what we want in the RV we are planning to buy.
I don't put much faith in a well-educated RV writer who does not know the difference between lose and loose. However, I agree with his gloomy forecast. The lure of RV camping faces numrous problems, including the growth the the motor home gang, versus those who like to simulate camping. Just look at all those outside lights on Class A's at many parks, and you will see what I mean. I think the industry will change dramatically, but definitely survive. Erie Jimmy
My wife and I had planned to full-time RV within the next couple of years as we enter semi-retirement. Now we are having second thoughts. I wish I could feel more sorry for the RV industry as a whole, but like the auto industry, they have gone-on with business-as-usual, apparently caring more about profits and dividends for top-management than about preparing for and creatively meeting the challenge of changing times.
Virtually all current RV's are bloated, over-priced fuel-guzzlers, no matter what minor improvements have been made industry-wide during the past few years. Consider me a small dinosaur if you like, but I miss the old VW campmobile, back when it was affordable - although admittedly without a decent modern rest room; and the Toyota truck-based mini-motorhomes of the 1990's, despite some particular problems. These were at least creditable attempts at relatively inexpensive and fuel-efficient RV's that the averge working person could realistically hope to own.
Like the housing industry and banking industry, and media advertising - the RV industry has been catering too heavily to fat-cat luxury buyers. Now that many of them are in financial trouble like the rest of us, so are the RV manufacturers.
Hopefully we'll all get through this economic near-collapse, and eventually see more efficient and intelligently-designed RV's on the market in the future.
Jim: Among so many others, I appreciate your input and comments every week about a subject that is near and dear to all our hearts.
The RV industry's alarming condition is echoed across the US in these perilous times, most if not all of it being caused by executive elitism, greed, and lack of basic values and fair play. Collectively, those shortcomings have got us to where we are today in the chaos of Wall Street, the manufacturing sector in general, and financial institutions. It's distressing to think that those same people who got us here are collecting fat severance pay or even still wheeling-and-dealing while talented and hard-working people are losing jobs in the RV industry and their own houses. Maybe it will all shake out. It ain't over till -- you know. It sure isn't in our hands anymore.
Lori
I hurt for all of the good people who have lost their means of earning a living because of the "deregulation" of the eighties that was just an invitation to greedy, incompetent executives to grab everything they could at everyone else's expense. That plus a needless war and bankrupting the treasury starting in 2001-it didn't take a rocket scientist to predict where all this would lead! Keep up the good work Jim.
These are certainly accurate observations based on recent circumstances in the RV industry. Hope fully the industry that remains after this shakeout will be more focused on the consumer and their needs for reasonable, appropriate and well-made product. I don't think the business is going away; but only the strong and effective will survive in the current environment. I am approximately 17 months away from retirement and I haven't finalized my RV plans, although an RV has always been a been a part of my "dream" retirement. I have a paid off house, and am several months away from being debt free. I think I will be in an ideal position to enter the the RV lifestyle without any debt. I do feel for the workers receiving pink slips. I hope and pray that they find alternative employment. People need to have a plan of continuous personal and professional improvement in the current economy ( and in any economy) I have done this for 30 years and have found this to be extremely effective in improving my income and my personal lifestyle. Don't wait for a government lifeline unless you want to be stranded on a housetop waiting for the national guard.
Thanks, Jim. If I need accurate information, I would read your information first. We still have many used RV ads touting their remaining warranty as a sales pitch. The corrupt unions are the main source of problems in this and the auto industries. The same product could and is produced for thousands less where unions are not present. I suspect Japan and China will be here soon to fill the RV void. Now Obama wants to pass the open ballot for union elections. Can you imagine the poor terrorized worker who votes no? What's next? Open ballots for national elections? Constitutional amendment to allow DC to become another left wing vote? Alas, if you pay Paul with Peter's money, you will always get Paul's vote....until the money runs out. I will retire to a decent diesel motor home and stay out of the IRS's gunsight, but I feel terribly for those who cannot, and for the grandchildren who must repay this horrendous debt.
Does anyone know how Dometic is doing? As a former employee, they make dangerous products and should be investigated by the Consumer Products Division. Thetford/Norcold is a better bet for your money
Hi Jim,
I hope that your family continues to recover from the loss of your brother-in-law. It is undoubtedly a rough time for all of you. You mention in this post that used RVs will be available to enjoy. However, it doesn't seem as though some RV Dealers are going down on their prices as much as I would think that they would. Some other sites like this Used RVs for Sale website seem a little more reasonable, but I am surprised prices haven't gone down more. Are you? I loved economics class in College, so I find your views very interesting.
Thanks,
Jenny
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