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Oregon Facing Another Blow With Monaco Exit

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August 3, 2011 by   Leave a Comment

Monaco RV LLC will quit making big luxury coaches in Oregon, and that means 450 Lane County workers will be out of a job by early next year.

The Register Guard, Eugene, reported that parent company Navistar International Corp. assembled its Coburg RV plant workers at 1 p.m. Tuesday (Aug. 2) and delivered the long-expected news: To reduce excess manufacturing capacity, Navistar will consolidate its Monaco coach manufacturing at its Indiana plant. That will leave only 150 employees in Coburg.

“One guy was actually clapping,” probably out of frustration, said Barry Phillips, a 30-year-old floor installer at the plant.

The announcement caps years of wildly swinging ups and downs for the local Monaco work force, which already had been winnowed down in recent years from 2,200 to 600.

The employees went from record-breaking production in the mid-2000s to increased furloughs as the recession took hold to a massive layoff in late 2008 to a takeover by Navistar and rehiring with pay cuts — and now to a shutdown of motor coach manufacturing, which means curtains for the welders, cutters, assemblers and painters who worked on the RVs.

Many already have faced foreclosure or bankruptcy.

Lydia Short, 23, has worked at the plant for about a year after moving to Eugene from Indiana. She said she won’t go back to Indiana because her husband is a student at the University of Oregon.

“I’ll look for a job,” she said, “and that’s hard to do in Eugene.”

The layoffs will happen sometime in the next six to nine months, Monaco spokesman Steve Schrier said.

“They will continue making motorhomes here throughout the transition. It will not be a light switch event,” he said. “But at the end of the day, diesel motorhomes will be made at Wakarusa, Ind.”

After Navistar ends RV production here, about 150 workers will remain in Coburg to continue producing towable travel trailers, operate the Monaco RV service center and maintain other finance and information system functions for the company.

Navistar, which also makes trucks and truck engines, is having a good year financially. In the second quarter, its profits soared 86% compared to a year ago, to $80 million on sales of $3.3 billion, company financial statements show.

The departure from Lane County of 450 RV manufacturing jobs will leave only about 450 transportation equipment manufacturing jobs in the county, regional economist Brian Rooney said.

That’s 10% of the jobs the sector had in its 2005 heyday, when about 4,500 workers in Lane County were churning out motorhomes.

Monaco notified Oregon officials a month ago that it would consolidate RV manufacturing either at Coburg or Wakarusa, said Jack Roberts, executive director of Lane Metro Partnership, which recruits businesses.

Lane Metro Partnership, along with the Oregon Economic Development Department and the governor’s office, put together a pitch to persuade Navistar to keep the plant here, Roberts said.

“I’ve heard unofficially that the package we put forward was as good or better than theirs, but the fundamental advantage of being in the Midwest where a lot of their suppliers are — and where their connections are — made the difference,” Roberts said.

Coburg’s loss is Wakarusa’s gain. Economic development officials there were “elated” when the company said it would create 400 new jobs at its consolidated plant by next year.

The loss of the Monaco jobs is another blow for Lane County, where the unemployment rate was 9.4% in July.

The RV manufacturing jobs are part of a dwindling class of employment that pays well and has good benefits but doesn’t require a college degree, Rooney said. The broader community also will miss the Monaco paychecks, he said.

“You take that income out of the economy, it has a multiplier effect but in a negative way,” Rooney said. “Those jobs help support retail and services — and that can affect other services.”

The laid-off Monaco employees will have a struggle to find comparable work.

“The manufacturing that is here has been pretty flat,” Rooney said. “Some (former employees) may have to move out of the area.”

Roberts said he’s not giving up on the RV industry as a job creator in Lane County yet.

The demographics are favorable, Rooney said. Retired baby boomers buy the luxury coaches. The stock market has recovered, some, from its historic lows. And gas prices have receded a bit.

“We would love to be a part of this,” Roberts said. “But if that doesn’t happen, we’ll just have to find something else.”

 

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