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ASV is Emerging as Major Motorhome Player
Posted By Dave Barbulesco On May 17, 2013 @ 12:13 pm In Breaking News,News In Focus | 1 Comment
In the wake of its announced acquisition of Navistar Inc.’s RV operations, Allied Specialty Vehicles (ASV) has begun assembling the pieces for its emergence as a major player in the motorhome segment.
Faced with a raft of organizational and engineering challenges, ASV has mapped out a strategy that will consolidate the building of four high-profile motorhome brands at its campus in Decatur, Ind., while also realigning its corporate structure.
“We will be manufacturing four very iconic motorhome brands – Fleetwood, Monaco, Holiday Rambler and American Coach – all with strong recognition in the marketplace, a loyal customer base and tremendous dealer networks,” noted John Draheim, president and CEO of Fleetwood RV Inc., a division of Orlando, Fla.-based ASV.
As part of the buyout, ASV purchased all of the equity interests of Navistar RV, including manufacturing operations for Navistar’s R-Vision and Holiday Rambler towable units in Harrisburg, Ore., and Navistar’s Monaco and Holiday Rambler brand motorized RVs in Wakarusa, Ind. ASV, which is owned by private equity firm American Industry Partners, has also entered into a multi-year leasing agreement for Navistar RV’s Elkhart, Ind., plant, a former Roadmaster chassis facility that houses towable operations. The sale does not include Bison Coach, Navistar’s horse trailer manufacturing business.
“Towable operations will not be impacted,” said Draheim. “The Roadmaster chassis is currently being assembled in an out-building in Wakarusa. We haven’t made a decision if we will continue to build chassis.”
Phasing out Operations in Wakarusa
The most imposing challenge will be the phasing out of operations in Wakarusa while preparing for a ramp-up of production in Decatur where ASV operates facilities encompassing 558,500 square feet of manufacturing space. Currently around 412,000 square feet are being utilized for Fleetwood/American Coach production.
“We are going to continue to build units in Wakarusa for the next three or four months, fulfilling all of the commitments already on the books,” Draheim said. “I anticipate that the last unit will run down the line sometime in August. At the same time, we’ll be implementing a parallel project in Decatur to prepare for the move.”
Draheim reported that the relocation will impact around 500 workers at the Wakarusa plant, 400 involved in production work. “The balance are in product development and engineering, and we are hiring people from those groups. Parts and service will not change.”
Draheim said that while production will continue, the work force will be incrementally pared down. Employees, who were meeting with management today, would be considered for openings in Decatur.
“I don’t see us starting production in August or even September,” he said, “so I don’t know if people will be able to wait that long. Our intent is to sell the Wakarusa facility. We have already received interest from a few industry companies where people would be able to find employment.”
He added, “Our top priority is taking care of these people who lost their jobs.”
Launch of a New Era for ASV
Draheim said that initially ASV would essentially be setting up two companies in Decatur.
“We will be forming two separate business units – Monaco/Holiday Rambler and Fleetwood/American Coach,” Draheim said. “Sales, marketing, product development, parts and service will all run independently. Long-term that may change. I can envision how the two companies and four brands will fit under the ASV umbrella.”
Product development, however, remains at the forefront.
“We will be adding additional product development/engineering resources to those inherited in the deal from Navistar, as we view product as an extremely important component for success,” he said. “One of our main goals will be to further differentiate the brands. Monaco was the premier luxury motorhome in the market, but Navistar tried to change the product through its engine strategy. They tried to make Monaco something it’s not.”
Draheim said that the production side would not be immediately impacted, noting that RV sales had been dropping since Navistar Inc. announced last October that RVs represented a “non-core” business.
“At the volumes we’re running today, we’ll be able to integrate production in Decatur without changing our facilities,” he said. “As volumes increase, we may need to reconfigure.”
ASV’s management structure will also be in a state of flux while operations are merged. Draheim will continue to head up Fleetwood/American Coach while longtime Monaco executive Mike Snell has been named as president of Monaco/Holiday Rambler. Bill Osborne, president of Navistar RV, will not be part the new team.
“Mike will be reporting to ASV COO Jim Meyer, who is also acting COO for Fleetwood,” Draheim said. “We are currently conducting a job search to fill the Fleetwood slot so Jim can concentrate on his corporate responsibilities.”
He added, “In the next 60 to 90 days we will announcing a new management structure. I can foresee a corporate ASV RV umbrella with two business unit presidents and one COO to oversee operations. Right now, we are wading our way through all the changes and are focusing on implementing a plan that makes sense.”
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