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Dealers Concerned About Earthbound’s Future

Posted By RVBusiness On October 14, 2011 @ 9:09 am In Breaking News | No Comments

Officials at several dealerships say they are concerned about the future of Marion, Ind.-based Earthbound Recreational Vehicles LLC, according to a report by the Indiana Economic Digest.

“We were always hoping to be a part of their success, but right now I feel that we are in limbo,” said Bill Mirrielees, general manager of Howard RV Center in Wilmington, N.C.

Earthbound President C. David Hoefer said the company was focused on lining up everything for its new business model and “confidently” projected that production would begin again by mid-November. He said the company will start work on both new and old models at that point.

“We’ll be building for probably four months straight before we take another order,” he said. “It’ll be very low key as we move it forward. We look at this as the nature of being start up. We’re excited and just looking forward to the new line.”

The start-up company relocated in Marion in 2010 with the city backing a $2 million bond with county economic development income tax (CEDIT) money to support its startup. The company never met expectations to hire around 180 employees to produce 400 or more coaches a year at its 1001 E. 38 St. factory.

Production has been shut down at its factory as the company retools its strategy in anticipation for an announced new “boutique” product line with a higher price point than older models. Only 100 units are slated to be sold in North America at a starting price of $84,900.

Indiana Economic Digest reported that Hoefer said the company has been focused on lining up international distribution in China and Europe for another 100 units of the new line for the past few weeks. He said the company will probably use just 12 dealers in the U.S. in the future.

“We’re going to be scaling the network back,” he said. “It will essentially be a lot more limited high distribution network.”

Hoefer said the company has kept a number of its “closer” dealers as part of the process. However, some current and former dealers said they have not been kept informed of changes in business strategy. In addition, they said old orders and warranty claims have been left unfulfilled.

Mirrielees said his dealership still has product orders from April and May that have yet to be built, as well as outstanding warranty claims. He said one retail order has been cancelled and its deposit refunded and there has been no commitment on when the others can be built.

“Not that we’ve canceled them, they can’t tell if they would be built even this year,” he said. “I would hope that they get back up and running soon. I hope they are able to catch up on the unpaid warranty claims.”

He said he hoped the company would “turn this thing around” because the company has created an “outstanding” niche in the marketplace.

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