Jayco’s Expansion: Another Sign of RV Upturn

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March 9, 2010 by   Comments Off on Jayco’s Expansion: Another Sign of RV Upturn

Th Aspire Class A by Entegra Motorhomes

The Aspire Class A by Entegra Coach

As one of a number of recreational vehicle manufacturers recovering from the recession of 2008-2009, Jayco Inc. will start building high-end Entegra Class A motorhomes in June in a 30,000-square-foot addition to its factory in Middlebury, Ind.

”The expansion has started,” Jayco President and COO Derald Bontrager told RVBusiness. ”We have moved dirt. We anticipate that the building will increase our production from 150 a year to right around a thousand.”

The city of Middlebury in February approved a 10-year tax abatement on the property and a three-year abatement on manufacturing and IT equipment that will be going into the new facility.

In a related move, Jayco in May will restart limited production of its Starcraft towable RV brand in the same Topeka, Ind., factory that it mothballed last year as the company moved Starcraft production to Middlebury during the recession. Full production of Starcraft units is expected to shift back to Topeka over the next two to three years as some models continue for now to be built in Middlebury.

Initially, Jayco will move 65 people to Topeka to build Starcraft’s Autumn Ridge and Travel Star towables.

”At the time (of Starcraft’s 2009 move to Middlebury) we said that when market conditions allowed us we would reopen in Topeka,” Bontrager said. ”We feel the time is now to take advantage of the market that is starting to return. We don’t have a timetable yet, but we will be moving all our Starcraft product lines over to Topeka.”

Jim Jacobs recently was named general manager of both the Starcraft RV and Entegra Coach divisions.

Derald Bontrager, Jayco president

Derald Bontrager, Jayco president

Bontrager said that both moves are in response to improvement of the RV market as the U.S. emerges from the longest economic recession in more than 50 years.

”During the winter months, part of what’s been going on, along with the increased retail activity, is that dealers have been restocking for the upcoming spring selling season,” Bontrager said. ”Retail shows all over the country have been very well attended and sales have been relatively good — better than last year. People are doing more than looking. They are out buying.”

In 2008, Jayco acquired the assets of former Wakarusa, Ind.-based Travel Supreme Corp. and created the Entegra line of Class A diesel pushers in lengths up to 45 feet with MSRPs from $250,000 to $600,000.

The recession that followed stifled Jayco’s plans for the Entegra. ”We are still pretty much a startup in the luxury diesel market,” Bontrager said.

Bontrager said the expansion of the Entegra production line is necessary. ”With our current production capacity of 150 a year, our backlogs have grown to an unacceptable level,” he said. ”We anticipate that there will be a two-year ramp up to get to the production level we want to hit as we build our dealer base and add to our (Entegra) product offering.”

Bontrager reported the company has rehired 250 people that had been laid off and that Jayco’s total employment is now at about 1,500 workers. ”Our production today is double what it was a year ago,” he said.

But while economic prospects appear to be improving, Bontrager said that the RV industry still has a way to go before full recovery.

”There are still a lot of segments of our industry and of the economy that have to come back before we are on really solid footing. It’s going to be a different type of recovery; it’s going to be a slow recovery.”

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