After financial setbacks that caused Earthbound RV LLC to mothball operations in Middlebury, Ind., in the middle of 2009, the company and its unique ”green” towable products are getting a second chance 90 miles to the southeast in the blue-collar community of Marion, Ind.
And in the process, so, too, is high-profile entrepreneur C. David Hoefer waging another commercial comeback.
Key to the move: an infusion of $2 million in private capital, $900,000 in state tax breaks over the next five years and $100,000 in state training grants.
Earthbound expects to hire 60 people this year to build lightweight, eco-friendly Earthbound-brand travel trailers while creating a total of 300 jobs 2013.
”Financing in Elkhart County is tough, very tough right now,” Hoefer, Earthbound chairman and CEO, told RVBusiness. ”And, in Elkhart County, you are just another RV company.”
Contrary to popular belief throughout the RV industry, however, Earthbound did not go out of business, Hoefer reported. ”We didn’t actually close,” said Hoefer who has had a hand in founding a number of companies over the years, including Dutchmen Manufacturing Inc. Hart Housing, Four Winds International Corp. and Pilgrim Inc. ”We kept operating. We just ceased production.”
The idea of moving to the Grant County community of Marion actually came last fall from one of Hoefer’s sons, Charles Hoefer, who works for the city park department, and was aware of the fact that Earthbound was looking for an infusion of capital.
”He said, ‘Marion is really looking for jobs. Would you consider (moving to) Marion?’ I said, I didn’t know why not. And about 45 minutes later, I got a text message that the mayor had told his people, ‘We want Earthbound.’ They put a full-court press on it.”
Within days, Hoefer said, the city had lined up five banks to meet with Earthbound representatives, and later the state was brought into the negotiations.
”I’ve never seen such an aggressive group that is more intensely focused,” Hoefer said. ”These gentlemen worked 10, 12, 14 hour days to get us down there and convince us that that’s where we belong.”
At the time of the announcement in mid-February, Indiana Gov. Mitch Daniels appeared in Marion and lauded the RV industry in general for its nascent recovery from the Great Recession. ”As expected, the RV industry is reinventing itself and starting to bounce back,” Daniels said. ”We couldn’t be happier to see the revolution happen here in Indiana, a state known for high-quality production and skilled workers.”
Hoefer said Marion’s manufacturing culture, which has sustained serious setback in recent years from both electronics and automotive industry closures, fits well with Earthbound. ”Their culture is like our company’s culture,” Hoefer said. ”They aren’t sitting in committees talking about things. They are action people. They are aggressive. They are looking toward the future.”
Wherever the company is located, Hoefer said that Earthbound’s basic premise has not changed since it was founded in November 2008: to build high-quality RVs out of composite materials that only recently have come into use in the RV industry.
”Being able to put automobile-type quality like you get in today’s Ford or GM product in a towable product … is our long-range goal,” he told RVBusiness. ”The entire unit is being constructed out of these (composite) materials.”
In so doing, Earthbound is taking its cues from the automobile, marine and aircraft builders, according to Hoefer.
”Everything we’re doing is not new,” he said. ”It’s been done in other industries. The application is different. To do what we need to do, you can’t do it with the same materials we’ve been using. If it weren’t for TekModo (LLC) helping me get started on this process seven or eight years ago, this could not have happened.”
The company, which also is being led by industry veterans President Ken Geljack and COO Bill Hughes, will build travel trailers in 22- to 30-foot lengths with $35,000 to $44,000 MSRPs with few options.
”It’s really starting over right now,” Hoefer said. Even though the prototyping is done and the product and material content is done, we are still working on second- and third-generation products that will be coming out in a year to two years.”
Contrary to rumors that have been circulating since the announcement of the Earthbound’s move to Marion, Hoefer maintained, the company is not for sale.
”In recent days, once they found out we had financing, others have become interested in us again,” Hoefer said. ”But it is not for sale and will not be sold. We are going to make it a nice company where people want to work and have fun and build product that we can be proud of.”
Yet another RV manufacturer is entering the marketplace this week (March 26-29) with the debut of lightweight Earthbound travel trailers from startup Earthbound RV LLC at the Quebec City RV Show in Quebec City, Canada.
“One of our goals was to meet a demand that wasn’t being met for full-size lighter weight trailers that are ecologically friendly,” said Bill Hughes, Earthbound vice president of operations.
Founded in January, Earthbound RV is operating from a three-building, 108,000-square-foot manufacturing campus on U.S. 20 in Middlebury, Ind., once occupied by Pilgrim International Corp., which went out of business in September.
“There are approximately 11 million minivans and small-size SUVs on the road looking for something they can tow,” said Hughes, the former head of Pilgrim’s service, warranty and parts department. “Earthbound will be lighter weight, but we haven’t had the weights confirmed yet.”
Limited production of Earthbound travel trailers sporting aluminum superstructures and painted aluminum sidewalls laminated to a lightweight CosmoLite composite material from TekModo LLC is scheduled to begin next week.
“We took design cues from the automobile industry, particularly on the front and rear caps, and the full use of LED lighting,” Hughes said.
A prototype of Earthbound’s 29 1/2-foot “Golden Ridge” floorplan is being unveiled at the Canadian RV show.
“We expect that by June we will be producing 10 units a week,” Hughes said. “The market will dictate where we go beyond that.”
Earthbound RV currently has 16 employees and eventually expects to have 60 workers, Hughes said.
Earthbound trailers will be offered in seven 25- to 30-foot floorplans, four of which are available with a single slideout, brushed aluminum interior walls, dual-pane acrylic windows, aluminum appliances, U-shaped booth dinettes, laminated countertops, vinyl floors and heat pumps. Cabinets have a vinyl wrap laminated to a sheet of aluminum that is laminated to a polyurethane composite.
Earthbound RV also is exploring the use of adhesives not traditionally used in RV applications. “We are committed to innovation and we are developing resources toward that,” Hughes said.
Company principals are industry veterans Hughes; President Ken Geljack; Canadian RV dealers Andre Levesque of A.S. Levesque, Ste-Helene, Quebec; Ken Friedenberg and David Hill, owners of ArrKann Trailer and RV Centre, Edmonton, Alberta; and Elkhart, Ind.-area businessman Ted Holland. Former Pilgrim Chairman David Hoefer Sr., who originally launched the Dutchmen brand, is a consultant.
“A small group of us approached Dave (Hoefer) last fall and asked him to give us some insight,” Hughes said. “He allowed us to use some of the plans he had. Dave is a visionary.”
Hughes said the company has verbal commitments from about 40 dealers – half in the U.S. and half in Canada.
“We don’t need 200 dealers to be successful, and we don’t need to build 10 units a day,” Hughes said. “We are focused on providing quality beyond anything that’s been experienced in the past.”