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Keith D. Corson was a Founder of Coachmen

July 16, 2010 by · Leave a Comment 

Keith D. Corson

Keith D. Corson

Keith D. Corson, 74, of Granger, Ind., one of the founders of Coachmen Industries Inc., died Wednesday (July 14) at Elkhart General Hospital after an extended illness.

A 1953 graduate of Bristol High School, Corson served in the U.S. Marine Corps after which he attended Wichita State University and then worked for Sears Roebuck and Taylor Products in Elkhart, according to The South Bend Tribune. In 1964, he and his brothers Tom and Claude Corson, founded Coachmen Industries Inc. in Middlebury. Keith helped engineer the company’s earliest products as president of the firm and oversaw all manufacturing and procurement operations until 1981.

He departed to manage the Robertson’s Department Stores and later to acquire Koszegi Products, Inc. in South Bend which he sold in 1990. He then returned to Coachmen Industries and resumed the position of president and a director until his retirement in 2000.

He was very instrumental in the diversification of Coachmen throughout its history and during his tenure had served the Recreation Vehicle Industry Association (RVIA) as its chairman of the Quality Control and Standards Committee.

He served on numerous community boards during his career.

Survivors include his wife, Janice, whom he married July 14, 1957, a daughter, Staci Lynn Corson, a brother, Thomas H, Corson, and a sister, Judith K. Lentz.

He was preceded in death by his brother Claude, who died May 9, and a sister, Rosalie P. Corson.

Friends may call from 4 to 7 p.m. Saturday at Stemm-Lawson-Peterson Funeral Home, Bristol Street at Cobblestone Blvd., Elkhart where the memorial service will be at 2:30 p.m. Sunday. The Rev. Fred Stayton will officiate. Cremation has taken place at Keith’s request. Burial will be in the Oakridge Cemetery, Bristol at a later date. Memorials may be given to the Bristol United Methodist Church, 201 Division St., Bristol, IN 46507, or Center for Hospice and Palliative Care, 111 Sunnybrook Drive, South Bend, IN 46637.

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Claude Corson’s Funeral Slated for Thursday

May 11, 2010 by · Leave a Comment 

 

Claude Corson

Claude E. Corson

One of the founders of Coachmen Industries Inc., Claude Edward Corson, 80, died at his home Sunday afternoon (May 9) following an extended illness.

He was born Dec. 19, 1929 in Elkhart, Ind., to Carl W. and Charlotte (Keyser) Corson. He married Sue Main on Dec. 29, 1963, in Leesburg, Ind. She survives along with their daughter, Claudia Sue (Larry) Adams of Indianapolis; two grandsons, Craig and Drew Adams; two brothers, Thomas H. (Dot) Corson, Middlebury; Keith D. (Janice) Corson, Granger; and a sister, Judith K. (Larry) Lentz, Elkhart. He was preceded in death by his parents and a sister, Rosalie P. Corson in 2006.

A 1947 graduate of Elkhart High School, he served in the U.S. Air Force during the Korean War after which he attended the University of Maryland and worked in the public relations and advertising fields. In 1964, he and his brothers, Tom and Keith Corson founded Coachmen Industries Inc. in Middlebury, Ind. Claude Corson designed, built and sold Coachmen’s earliest prototypes and participated in the company’s early diversification of acquiring Kenco Engineering Co., Viking Boat Co., Henco Enterprises, and in starting Coachlite Supply Co.

Corson left active employment with Coachmen in 1970 and founded or co-founded several other businesses, including Unitron Engineering, Intertec Supply, Quest Products, and First React Medical Supplies. He was a past member of the Elcona Country Club, The Elks and a current member of the American Legion Post # 210, Middlebury. He was a member of the Hillcrest United Methodist Church, Elkhart. Retired pastor Don Carpenter will officiate the funeral service.

Friends may call 2 p.m.-4 p.m. and 6 p.m.-8 p.m. Wednesday (May 12) at the Miller-Stewart Funeral Home, 1003 South Main Street, Middlebury, Ind., and services will be at 10 a.m. Thursday (May 13) at the funeral home. Burial will be in Grace Lawn Cemetery, Middlebury, immediately following the service with full military rites performed by the American Legion Post. Memorials may be given to the Boys and Girls Club of Middlebury or Care at Home Hospice of Goshen General Hospital, Goshen, Ind.

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Elkhart’s RV Rebound May Indicate Recession’s Exit

September 8, 2009 by · 2 Comments 

George Graber was unemployed for three months this year after the shutdown of an RV plant in Elkhart County, Ind. Now, he’s building $15,000 travel trailers at startup Heritage One RV Inc.

His job-hunting luck reflects a rebound in RV demand that may signal the end of the worst U.S. recession since World War II. In the last four domestic cycles, Winnebago Industries Inc. and other RV makers foreshadowed the economy’s decline and heralded its recovery, government and trade-group data show, according to Bloomberg.com.

“The RV industry is always the first in and the first out, and there’s already been a noticeable beginning of it coming out of the current recession,” said Dave Hoefer, 66, an adviser to Earthbound Recreational Vehicles, which was founded this year on the site of another bankrupt maker in Middlebury, Ind.

Elkhart County builds more than half the RVs sold in the U.S., making it the center of a $14 billion domestic market. Evidence of a turnaround is showing up in new companies like Heritage One sprouting from the remains of failed manufacturers, and in no-vacancy signs at a motel favored by RV-hauling truckers.

Analysts watch RV sales because motorhomes and travel trailers are discretionary purchases that consumers defer in an economic slump. Industrywide deliveries may rise in 2010 to end a three-year decline, said Richard Curtin, director of consumer surveys at the University of Michigan.

Sales in July, the latest available, ran at the strongest annual rate since October, according to the Recreation Vehicle Industry Association (RVIA). By year’s end, those shipments should show their first monthly gain since October 2007, predating the onset of the recession in December of that year, said Curtin, who analyzes data for the Reston, Va.-based trade group.

Rise and Fall
Wholesale deliveries to dealers averaged 355,000 over a six-year period that ended in 2007, then tumbled to 237,000 last year as the recession took hold, according to RVIA data.

Showroom visits and consumer-loan approvals now are rising for the first time in more than a year, said Steve Smith, a Heritage One partner who recently drove 5,000 miles through the Midwest and South as part of a company sales call.

“Customers’ interest is obviously rising, which is making the dealers feel better,” Smith, 47, said from the 30,000-square-foot building in Nappanee, Indiana, where Graber and about a dozen other workers were assembling so-called “stick and tin” trailers of metal sheets over wooden frames.

Three Obama Visits

Elkhart County needs that kind of news. Located along the Michigan border and home to about 200,000 people, the county has a jobless rate of about 17%, the worst in Indiana. President Barack Obama has visited the area three times to talk about economic hardship.

Ron Muhlenkamp, whose Muhlenkamp & Co. in Wexford, Pa., has invested in RV makers coming out of past recessions, said he isn’t yet buying the stocks in this cycle.

“We think the consumer might be slower to return this time,” he said. U.S. joblessness reached a 26-year high of 9.7% in August, the Labor Department said on Sept. 4. The so-called underemployment rate, which includes part-timers who would prefer full-time work and job seekers who have stopped looking, rose to a record 16.8%.

Before coming to Heritage One, Smith worked at Travel Supreme Inc., a maker of $160,000 trailers that shut its plants in January after another company bought out the operations. Nearby sit two vacant buildings owned by motorhome maker Monaco Coach Corp., which went bankrupt in March.

Betting on Recovery

Earthbound, the company advised by Hoefer, is on the site of Pilgrim International Inc., which went out of business in September 2008. Earthbound has been working on $42,000 lightweight trailers since January and is betting on a recovery in time for a sales push in early 2010. Heavier trailers cut fuel economy for their tow vehicles.

“We feel the industry has a strong future,” said Bill Hughes, 58, an Earthbound investor who was a Pilgrim vice president of service and parts. In the past year, 15 new RV makers have begun operations, according to the RVIA.

Another sign of recovery is bookings at the Red Roof Inn in Elkhart, said General Manager Beth Ronzone, a 24-year employee. The motel is filled again on some nights with truck drivers who move RVs, a reminder of the industry heyday two years ago when rooms were sold out five or six times a week.

‘Seeing a Pickup’
“We started seeing a pickup in late April,” Ronzone, 57, said Aug. 24. By that evening, most of the parking lot was occupied.

Hiring is starting to pick up, too, said Dorinda Heiden-Guss, president of the Economic Development Corp. of Elkhart County

Keystone RV Co., a Goshen-based unit of Thor Industries Inc., the largest U.S. RV maker, announced last month it will add 200 workers to expand travel-trailer output, Heiden-Guss said. Jayco, in nearby Middlebury, is also recruiting, she said.

Among the investors betting on the industry is Warren Buffett’s Berkshire Hathaway Inc. Berkshire’s Forest River Inc. RV unit paid about $42 million for the RV business of Elkhart- based Coachmen Industries Inc. American Industrial Partners bought the motorhome unit of bankrupt Fleetwood Enterprises Inc. of Riverside, Calif., in June for $53 million.

Winnebago and Jackson Center, Ohio-based Thor are the only large, publicly traded RV makers still in the business and not in court protection.

Shares of Forest City, Iowa-based Winnebago and Thor have almost doubled this year. Since the recession began, Winnebago has tumbled 45% and Thor has fallen 26%, compared with a 31% decline in the Standard & Poor’s 500 Index. Coachmen still operates its bus and manufactured-home business.

Horses, Humans

At Sierra Motor Corp., a 22-year-old maker of interiors for horse trailers, 2008’s record-high fuel prices helped spur expansion into human transport.

The Bristol, Ind.-based company added a line of travel trailers weighing less than 1,750 pounds. They include amenities such as toilets, which aren’t common on models that small, President Michael Greene said.

That move also meant that Sierra Motor, which has about 45 workers, could keep about a dozen employees who would have been laid off as orders for equine vehicles flagged, Greene said. The labor force has exceeded 100 in busier times, he said.

“They are like family, you hate to have to let people go,” said Greene, 52, who was one of the company founders.

For Graber, 45, who had to sell his pickup for a cheaper model and take other belt-tightening steps after losing his purchasing job at Travel Supreme, the Elkhart recovery can’t come fast enough.

“People I know personally, a couple of them will get back every week now,” he said. “Three months ago, everyone was just down and they weren’t even taking applications.”

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Amid Economic Woes, Elkhart’s Businesses are Adapting

August 17, 2009 by · Leave a Comment 

Elkhart, Ind., has many, many stories to tell.

There are stories about lost jobs and economic hardship. There are stories of people and businesses seeking to transform themselves to meet the needs of a fast-changing world

In many ways — largely thanks to visits to the region by President Barack Obama and the accompanying national media — the northern Indiana city famous for RVs and manufactured housing has become the face of the current recession, according to the Indianapolis Star.

While Elkhart is heavily reliant on the RV and housing industries, the challenges of the current economy ripple throughout the community. Elkhart County’s high unemployment rate, 16.8% in June, has actually been showing some improvement since the dark days of winter, when the rate reached around 19%.

That sort of economic stress has businesses of all sorts trying new things.

Elkhart-based Coachmen Industries’ All American Homes unit constructed a “Living Zero Home” for the U.S. Department of Energy. The demo home is on a national tour to highlight ways people can save on utility bills and energy usage.

“The actual home design that inspired the Living Zero model will be introduced through our builder network and our company-owned retail centers in mid-August,” Coachmen CEO Richard Lavers wrote in a July 30 update to shareholders.

Such initiatives could pay dividends in the years to come. The need for such new initiatives is urgent. The company’s revenue of just over $29 million for the first six months of 2009 is down a whopping 58% from the same time a year ago.

The Elkhart Truth, as the local newspaper, is well placed to tell all of those stories of hardship and hope. But the news media industry itself has been in a state of turmoil as it confronts an advertising slump and many new forms of competition from the Internet.

The Truth, however, has found itself working with MSNBC.com as part of the Internet news provider’s ongoing initiative called “The Elkhart Project.”

The project (which can be found at elkhartproject.com) includes stories, photos, videos, a blog and links to social media sites Twitter and Facebook — all of the content dedicated toward telling Elkhart’s story.

“It’s energized the entire newsroom,” said Greg Halling, managing editor of The Truth. “It’s just transformed us in any number of ways.”

“We’ve been a lot more aggressive about developing our website. . . . On a good day, we’re cranking out a lot more stuff during the course of the day than we ever did before.”

He said his staff has gained valuable experience from working with MSNBC.com’s veteran journalists in contributing content to the site.

Mike Brunker, projects editor for MSNBC.com, said there was some criticism in the early days of the project that the site was painting too dark a picture of Elkhart. But he added that working with local journalists has helped provided deeper coverage.

Halling said page views on eTruth.com, the paper’s website, have been consistently higher since the start of the collaboration roughly six months ago.

Plenty of challenges remain for Elkhart, as they do for the rest of the nation. But transformations of businesses and communities can happen.

And that’s one heck of a story.

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Stimulus Comes None Too Soon for Strapped Hoosiers

August 5, 2009 by · Leave a Comment 

President  Obama returns to Elkhart County, Ind., today (Aug. 5) at a moment when the county — so hammered by recession that Obama made it a symbol of the need for his stimulus plan — is finally getting some good news, according to Bloomberg.com.

Obama will announce Energy Department grants for electric-car development during a speech at a Monaco RV factory in Wakarusa, about 10 miles south of Elkhart.

That will follow Tuesday’s announcement by Sweden’s Dometic International AB that it plans to hire 241 people to make refrigerators for recreational vehicles in Elkhart, a city of 53,000 about 100 miles east of Chicago.

“There are signs that it is getting better,” said Wakarusa Town Manager Tom Roeder, 61.

Preparing for the president’s second appearance in six months, Elkhart County, with almost 200,000 residents, has become a symbol of Obama’s assurances that the economy, still facing tough challenges, is beginning to improve.

At the same time, indications that the economy in northern Indiana is coming out of its free fall are tentative, and balanced by signs that many people are still struggling.

Unemployment in the Elkhart-Goshen metropolitan area rocketed to 18.9% in March from 4.8% at the end of 2007. The jobless rate has eased for three straight months to 16.8% in June. Manufacturing employment, which hit an 18- year low of 44,900 jobs in March, inched up to 45,300 in June.

“Retail merchants tell me spending is up, there’s some slight improvement in housing starts and a few more vehicles are selling,” said Elkhart Mayor Dick Moore, 75, a Democrat who shared a stage with Obama on Feb. 9 when the president came to promote the stimulus.

Housing Market ‘Awful’

Still, in the automotive and housing industries, the economy around Elkhart hasn’t provided many encouraging signs.

The Elkhart area, which calls itself the RV capital of the U.S., lost more than 15,000 jobs in the past year as sales slumped at local RV and manufactured-housing companies.

“The housing markets are still just awful,” said Rick Lavers, president and CEO of Coachmen Industries Inc., which makes modular homes and sold its RV business last year to Forest River Inc. and Warren Buffett’s Berkshire Hathaway Inc.

Housing won’t recover until banks are more willing to make loans, Lavers said. “The cash has to get moving in this economy,” he said.

Since April 9, Coachmen’s shares have jumped to $1.32 from 25 cents.

Job Worries

Robert Wilson, president and chief operating officer of Supreme Industries Inc., a maker of specialized truck bodies and shuttle buses in nearby Goshen, said demand for trucks isn’t picking up yet.

“People are still worried about their employment, whether they’re going to find a job or keep their job,” Wilson said. “Until that changes, I don’t see the truck business getting any better.”

Obama is traveling to Indiana two days before the scheduled Aug. 7 release of unemployment figures for July. The national unemployment rate is projected to rise to 9.6%, according to the median estimate of economists surveyed by Bloomberg, from a 26-year high of 9.5%in June.

Touching Bottom

Other measures suggest the national economy may be touching bottom. Gross domestic product shrank at a 1% annual rate from April through June, after contracting at a 6.4% annual pace in the first quarter. The Standard & Poor’s 500 Index has risen almost 25% since Obama took office.

The Obama administration has prodded manufacturers to develop more efficient vehicles through a $2.4 billion grant program for development of batteries and related technologies that was included in the $787 billion economic stimulus legislation.

In addition to Obama’s trip, Vice President Joe Biden and Energy Secretary Steven Chu will travel today for events at other battery-technology developers in Detroit and Charlotte, N.C.

The factory where Obama will speak, formerly operated by bankrupt recreational-vehicle manufacturer Monaco Coach Corp., was purchased by Navistar in June. 

Electric Vehicles

Wakarusa-based Electric Motors Corp. will use a plant for a partnership with Nappanee, Indiana-based Gulf Stream Coach Inc. to develop an electric vehicle, Electric Motors CEO Wil Cashen said.

The company has applied for stimulus funds and would be “ecstatic” to get federal help, Cashen said.

If a local company gets an energy grant it “could be huge for our town,” said Wakarusa Chamber of Commerce President Nadine Lengacher, who owns J&N Stone, a family-run stone-veneer manufacturing company.

In Elkhart, projects funded by the stimulus, including sewer improvements and a $4.2 million airport-paving project, may have saved or created between 400 and 500 jobs, Moore said.

“We can see a light at the end of the tunnel,” said Bill Stevens, 41, vice president of Brooks Construction Co., of Fort Wayne, Ind., which rehired about 10 or 15 laid-off employees to work on a $10 million stimulus-funded construction contract on part of U.S. Highway 33 in Elkhart County. “It’s a matter of riding out the storm.”

While Lengacher sees some signs of recovery, she credits the “determination of the people who live in this county” and not Obama’s economic-recovery plan. “It’s a community that’s not one to sit back and cry because things are so bad.”

Counseling Patience

In Wakarusa today, Obama will counsel patience, said chief spokesman Robert Gibbs.

“It is going to take some time to move our economy from where we are, to get our economy back on track,” Gibbs said Tuesday. “The president will not be satisfied until we’re creating jobs.”

Coachmen CEO Lavers said many of his neighbors are getting tired of waiting.

“We’re eight months into 2009 and there’s no real perceptible turn on Main Street,” Lavers said. “I think people’s patience is about done.”

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Coachmen Reports Improving Results, Profitable June

July 30, 2009 by · Leave a Comment 

Coachmen Industries Inc. Wednesday (July 29) announced its financial results for the second quarter ended June 30.

Net sales from continuing operations for the second quarter were $17.7 million, compared to $11.3 million for the first quarter of 2009. Gross profits for the quarter were $853,000 or 4.8% of revenue, as compared to a loss of $2.1 million or 18.4% of revenue in the first quarter of 2009, according to a news release.

The Elkhart, Ind.-based producer of manufactured housing and specialty vehicles reported a net loss from continuing operations of $2.8 million, versus a net loss from continuing operations of $6.1 million in the first quarter of 2009. Net loss, including discontinued operations, was $3.2 million, versus a net loss of $6.4 million in the first quarter of 2009.

“Overall, sales are less than one-half what they were in 2008 as we continue to remain mired in the worst housing market in the last hundred years,” said Richard M. Lavers, president and CEO. “However, our business is beginning to show significant improvement. We have shaved our losses to one-third of what they were in the first quarter. We have experienced three months of modest but sequential revenue improvement, and both segments of our business posted modest profits in June. This is directly attributable to success in obtaining major project business, increased bus sales, and the steps taken to reduce our operating costs. We were essentially cash-neutral from operating activities in the second quarter.

“Tail liabilities from the sale of the RV business last December continue to decline and appear to be on track with projections. We are now heading in the right direction despite general economic conditions.”

He added, “Sales of the Spirit of Mobility buses produced for our joint venture ARBOC Mobility are relatively modest, but each month we are continuing to increase the number of orders and shipments. The bankruptcy of General Motors has had a temporary impact on availability of vehicle chassis and consequently our ability to build and ship units, but that situation has resolved itself. We anticipate regular availability of chassis beginning in August. Accordingly, this segment of our business should be a profit contributor rather than a cash drain for the remainder of this year and beyond. This is particularly true given the increased government funding available through federal stimulus packages.”

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RVDA of Canada Releases 2008 Dealer Survey Results

June 29, 2009 by · Leave a Comment 

The Recreation Vehicle Dealers Association of Canada (RVDA of Canada) has released the results of its 2008 Warranty and Parts Survey.

The trade group had 97 dealers, nationally, respond to the survey, which examined warranty and labor rates, warranty parts and handling as well as rated manufacturers in terms of their overall support, according to the association’s current newsletter.

In the manufacturer ratings, KZ RV LP, Shipshewana, Ind., got the top score, 82.4, out of 100. Jayco Inc., Middlebury, Ind., was second with a rating of 78.8, while Carriage Inc. of Millersburg, Ind., was third with 76.9.

Rounding out the top 10 were Crossroads RV, Topeka, Ind.; Pleasure-Way Industries Ltd., Saskatoon, Saskatchewan; Monaco Coach Corp., Coburg, Ore.; Cruiser RV LLC, Howe, Ind.;  Coachmen Industries Inc., Middlebury, Ind.; Fleetwood Folding Trailers, Somerset, Pa.;  and General Coach West, Oliver, British Columbia.

KZ, Pleasure-Way and General Coach West were the only three firms to rank among the top 10 in all four recent survey years (2008, 2006, 2005 and 2003).

Among the other findings:

  • The average hourly warranty labor rate varied  from $45 to $135 with the national average at $90.16.
  • The average retail shop rate was $92.50 per hour with a range between $45 and $130.
  • Warranty parts and handling allowances ranged from 0% to 100% with the national average at 17.2%.
  • The average parts margin nationally was 37.4%, with a range of 0% to 75%.
  • The number of technicians varied from one to 16 with the average of five per shop.

Most manufacturers give a handling allowance or mark-up for warranty parts. The majority of manufacturers gave allowances ranging between 10% and 40%.

Dealers also were asked to rate (with 100 tops) the following categories:

  • Ease of completing the claims, 64%.
  • Approval of warranty claims, 67%.
  • Flat rate time allowances, 56%.
  • Parts availability and supply, 64%.
  • Overall support, 69%.
  • Promptness of payment, 65%.

The recent survey had an overall satisfaction of 64.1%, which is higher than the 2006 survey, which received a satisfaction rating of 63.3%.

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Coachmen to Sell Georgia Complex to Schools

May 20, 2009 by · Leave a Comment 

Coachmen Industries Inc. announced today (May 20) that it has entered into an agreement for the sale of its former manufacturing, administrative and service complex in Fitzgerald, Ga., to Ben Hill County Schools.

The school system intends to use the facility for the service, repair and storage of its bus fleet, as well as for driver training and certification activities.

“Our strategic plan is to dispose of non-essential assets that do not support our core businesses,” stated Rick Lavers, Coachmen CEO. “This complex was unnecessary for our on-going business needs, which required its sale. Fortunately, at the same time the local school district was in the market for property such as ours, and we were able to reach an agreement that fits with our strategic plan and the school system’s needs. We view this transaction as a win-win for all parties involved. We are also pleased to see our surplus property put to good and productive use serving the children and schools of Fitzgerald.”

Coachmen was able to make the property, consisting of administrative offices, a manufacturing plant, and two service buildings, available to Ben Hill County Schools in continuation of its strategic plan to exit the RV business. The property occupies nearly 17.8 acres and has approximately 96,000 square feet of floor space, including service bays to service 14 school buses at the same time.

“The construction of our new elementary school, located adjacent to our existing School Bus Shop forced us to close the bus service facility in order to comply with new building code and Homeland Security regulations,” said John R. Key, superintendent of Ben Hill County Schools. “Coachmen was able to provide us with a first class, centrally located turn-key facility that meets our needs, now and for the future, at substantial savings to the other options we explored. We are very pleased that we have been able to acquire this property, and thank Coachmen for their continuing support of our community.”

Coachmen is not abandoning Fitzgerald, however, Lavers noted.

“We are currently working to establish another facility in Fitzgerald better suited to expanding our modular housing business in the Southeast,” he said. “We value the work and loyalty of our former employees in Fitzgerald, are proud to have been a member of the Fitzgerald and Ben Hill County communities for more than 40 years, and look forward to resuming operations in Fitzgerald as the housing market improves.”

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Settlement Helps Coachmen Make Q1 Profit

April 28, 2009 by · Leave a Comment 

Former RV manufacturer Coachmen Industries Inc. reported a loss from continuing operations for the first quarter ending March 31 but a profit when discontinued operations were factored in.

Net sales from continuing operations for the first quarter were $11.3 million compared to $30.8 million reported for the same period in 2008. Gross profit for the quarter decreased to a loss of $2.1 million, from a profit of $5.5 million for the first quarter of 2008. The company reported a net loss from continuing operations of $6.1 million versus a net profit from continuing operations of $1.3 million in the first quarter of 2008.

Net income, including discontinued operations, was $8.3 million in the first quarter of 2009, versus a net profit of $1.3 million in the first quarter of 2008.

Rick Lavers, president and CEO of the Elkhart, Ind.-based manufacturer of systems-built housing and specialty vehicles, explained that the company was able to post a first-quarter profit  “due to the booking of our settlement of the Kemlite RV sidewall matter with Crane Composites.”

The company also established a new financing partnership with Lake City Bank based in Warsaw, Ind. The settlement and new credit facility “are significant steps toward resolving the severe liquidity problems which have plagued the company since last winter, when Coachmen’s then-principal lender terminated our credit facility,” Lavers said. “Nonetheless, we cannot be overly sanguine, as we have immediate cash requirements while the funds from the settlement will not be available until later next month.”

Coachmen sold its RV operations to Forest River Inc. at the end of 2008.

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Crane to Make Good on Costly Sidewall Issue

April 22, 2009 by · 1 Comment 

Crane Co. announced Tuesday (April 21) that on April 17, the company reached agreement to settle a previously disclosed lawsuit brought by Coachmen Industries Inc. alleging failure of the company’s fiberglass-reinforced plastic material used for sidewalls in RVs.

As previously reported, a liability verdict was rendered by a jury in this lawsuit on Jan. 27, with the damages to be determined by a second jury later this year.

The aggregate damages sought by Coachmen totaled approximately $65 million and included approximately $20 million in repair and other direct costs allegedly incurred, as well as approximately $45 million in other consequential damages such as lost market share and lost profits.

In a mediation, Stamford, Conn.-based Crane agreed to pay Coachmen an aggregate of $17.75 million in several installments through July 1, 2009. Based upon both insurer commitments and liability estimates previously recorded, Crane recorded a pre-tax charge of $7.75 million in connection with this settlement.

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