Reports of the demise of the RV industry in Oregon’s Lane County are greatly exaggerated, industry veteran Bradley Waring says, borrowing a line from Mark Twain.
There’s no denying that the industry has taken a beating in the economic downturn. Two of the area’s major coach companies, Country Coach Inc. and Monaco Coach Corp., were purchased out of bankruptcy and now operate on a much smaller scale, The Register-Guard, Eugene, Ore., reported.
Monaco is a tiny division of multinational Navistar International, and Ron Lee, younger brother of Country Coach cofounder Bob Lee, recently resurrected Country Coach as a sales and service center, with hopes of eventually resuming production. Marathon Coach in Coburg still converts buses into million dollar coaches, but far fewer than in its heyday.
Lane County’s transportation equipment manufacturing sector, which has been dominated by the three RV manufacturers, employed 800 people in November, according to the state Employment Department. As recently as 2005, it had employed 4,500 people.
Even without a major manufacturing presence, Lane County still has a deep well of experience and expertise in RV sales, service and support, people in the industry say. They wanted to get the word out to RV owners across the country, so they formed the Oregon RV Alliance, a nonprofit marketing group. On Tuesday, the alliance’s founder, Bradley Waring, and several other members boarded a coach headed to the RV resorts near Palm Desert, Calif., where the snowbirds flock.
More than 2,000 snowbirds were expected at the Family Motor Coach Association (FMCA) rally in Indio, Jan. 13 through Jan. 15.
The Lane County delegation in Indio included Waring, former Lane County Commissioner Jerry Rust; Susan Graham, sales manager at Premier RV in Junction City; Meg Trendler, Travel Lane County’s tourism sales manager; and Tom Schneider, a retired Guaranty salesman.
Travel Lane County provided 1,200 Lane County Visitor Guides to hand out at the rally, and the Southern Willamette Valley Wineries Association supplied local wines for the delegation to serve as samples.
“We’re telling coach owners we’re still here,” Waring said. “The same people who sold you your coach, the people who serviced your coaches, the manufacturers who have built your coaches are still here.”
And while coach owners are having their vehicles serviced, they also can check out all the sights and attractions of Lane County, he said.
“We’re going to give them our message of renewal, and we’re going to … encourage them to bring their (coaches) back into this community over the spring and summer,” Waring said.
This is just the first of many of the alliance’s outreach efforts, he said.
Alliance has 30 members
Kurt and Betty Simon already visit Lane County often. The Eugene area is a convenient rest stop between their home in Auburn, Calif., and their children and grandchildren in Seattle and Portland, Kurt Simon said.
The retirees routinely have their 45-foot Monaco Executive serviced at Guaranty RV in Junction City where they bought it several years ago.
Simon said he’s not sure whether more RV owners will put Lane County on their itinerary after talking with Oregon RV Alliance members.
“I suspect that people are still staying closer to home,” he said.
But the Oregon draw is there, he said. “Motorhomes tend to be mobile anyway, and Oregon is a good place to go. It’s a beautiful state.”
The alliance already has 30 members, including RV manufacturers, dealerships, service centers, suppliers, local chambers of commerce, community festival organizers and others. Waring predicts it will have at least 200 members by the end of the year.
“I started this movement over Thanksgiving, and, frankly, it’s such a sensible idea that I’m having trouble getting around to meet with all the people who want to participate,” he said.
Through the ’90s and up until 2007, when the local manufacturers were going strong, there was a steady stream of out-of-town coach owners, who dropped by the factories to have their coaches serviced or remodeled, or to take part in motor home rallies.
Many stopped to shop at Guaranty RV in Junction City, formerly the largest RV dealership in the nation — and now the largest one that has managed to stay out of bankruptcy, general manager Shannon Nill said.
He said RV manufacturing has been Junction City’s strong suit for years.
“Even though it’s down a notch; it’s not gone,” Nill said.
So he said he was all ears when Waring contacted him about the alliance.
“I thought it was really tremendous that he would take it upon himself to gather up all the quality elements and put a shine on it and find ways to further network and make sure people know we are open for business in Junction City for motor home sales, service and accessories,” Nill said.
Some out-of-area coach owners still stop in Lane County, “but with the motor home manufacturing on the downside, there’s less and less of a need for them to come to this area,” said Rob Dickman, owner of the Les Schwab tire store in Junction City, a longtime supplier to the RV industry.
“By promoting the area, the recreation, the other people who work on motor homes here, and just the beauty of our area, we hope to give them a good excuse to keep coming back here,” he said. “They bring a lot of money when they come.”
Just filling up a coach’s 100-gallon tank, for example, is a nearly $400 expenditure, Waring said.
“If we band together and pitch to those people to come back to our area, it’s going to help everybody,” Dickman said.
“Attracting RV travelers to the region for service as well as sightseeing is mutually beneficial for the tourism and RV industries,” said Lisa Lawton, community relations manager for Travel Lane County. “We’re looking forward to connecting with industry leaders and RV travelers one-on-one to tap into this market and ultimately bring more visitors to this region,” she said.
More disposable income
Many coach owners have maintained ties with the people who sold and serviced their RVs. But alliance members said they want to cast an even wider net.
Most of the coaches serviced at Oregon Motorcoach Center are from out of the area, operations manager Ed Read said.
The 2-year-old business is owned by Bob Lee, founder of Country Coach, his wife, Terry Lee, and their son-in-law, Patrick Mason.
Oregon Motorcoach was eager to participate in the Oregon RV Alliance’s marketing efforts to RV travelers. “We want them to know that there’s a reason to be here again,” Read said.
Waring founded the alliance after losing his RV-related businesses, his mobile office — a Country Coach — and even his home in the downturn. He said he took “an involuntary sabbatical” from his 15-year career as a nomadic salesman, selling heated flooring and other supplies to major coach makers, and moved to Eugene in March 2009.
“I had all my eggs in the RV basket and I’m starting again,” he said. “My wife has been feeding me and giving me gas money.”
Recently, Waring has renewed relationships with old friends and associates in the RV industry.
“I’m so passionate about this,” he said. “(I want) to bring my friends back to work.”
He said he thought for years that the Lane County RV industry should partner more closely with the local tourism agencies to market the area to RV owners.
“This is a group of people who are mobile, they’re more affluent than most, they have disposable income that most of us don’t have,” Waring said.
The idea came into clearer focus over the summer when he volunteered at the front desk of Travel Lane County’s new adventure center in Springfield’s Gateway area.
Waring said he reached out to former Lane County Commissioner Jerry Rust after reading his campaign paper outlining his economic development ideas.
Rust signed on as the alliance’s co-director.
“I think it’s an interesting assignment,” he said. “I’m happy to go do it — be a cheerleader for Lane County.”
Before Rust and his wife, Zhang Yu Cai, boarded the coach Tuesday, he said he had ridden in Georgia-Pacific’s helicopter and even in the Goodyear blimp, but he had never ridden in a large RV.
“I’ve been in little camper outfits, but I don’t think I’ve really ever set foot in one of these monsters,” Rust said. “I’m looking forward to it, and I understand how excited the people in Junction City and Coburg must be to see some new life breathing into this industry that a lot of people thought was dead, dead and never would return.”
An all-volunteer project
The nonprofit alliance is an all-volunteer project, Waring said. Its sole source of funding is annual membership dues: $500 for charter members and $200 for associate members.
He said he’s heartened to see a core group of RV entrepreneurs have survived the downturn and are working to renew the industry.
“It’s pretty hard to put an entrepreneur down,” he said.
“I just want to inspire people to dust themselves off and pick themselves up and put this behind us,” Waring said. “We have everything in the world to offer here.”
A member of the family that founded Oregon-based Country Coach plans to reopen the company in January, on what appears to be a smaller scale — at least initially — than the RV maker formerly operated on, the Eugene Register-Guard reported.
Country Coach LLC went out of business last year.
Newly incorporated Country Coach Corp. says on its website: “We are pleased to announce that Country Coach Corporation is starting up operations at the factory in Junction City, Oregon, on January 3, 2011. At that time we will post contact numbers for our service center and our technical service support lines here on our website.”
“Country Coach Corporation owns all of the intellectual property (IP) of the former Country Coach, Inc. and Country Coach LLC,” according to the website, www.countrycoach.com. “This IP includes all of the production tooling and molds for fabricating virtually every part of your Country Coach Motorhome. Also included in the IP are all of the engineering drawings, bills of material, and as-built configurations for Country Coach Motor homes and DynoMax chassis built over the years.
“Our initial goal is to use the power of the IP and factory trained personnel to supply complete coach service, parts manufacturing, paint shop, phone technical service, and consignment sales to help maintain the investment in your Country Coach Motorhome.”
At the bottom of the website is a photo of a Country Coach RV, with the caption “Ron Lee’s 2009 Country Coach Magna.” Lee, who could not be reached for comment, is listed as the agent for Country Coach Corp. in state records.
Lee’s brother, Bob, founded Country Coach in 1973. The company was sold to California-based National R.V. Holdings in 1996, but Lee and others complained about what they saw as the new owner’s lack of support for the Junction City operation. A group led by Los Angeles investment banker Bryant Riley that included Bob Lee bought Country Coach back in 2007, shortly before the recession hit. Country Coach LLC, which had financial problems, attempted to reorganize under the protection of bankruptcy court, was unable to do so and was liquidated.
Earlier this year, Ron and Bob Lee and Bob’s wife, Terry, bought the company’s intellectual property as well as key pieces of equipment at auction. The family already owns most of the land and buildings.
Junction City’s interim administrator, Jamon Kent, said Friday that the city is aware — “and very supportive” — of efforts to resurrect Country Coach in some form.
“Country Coach is an extremely important part of our town and has been for some time,” Kent said. At its peak, Country Coach employed about 1,800 people. And, Kent said, the company and its employees supported other local businesses.
Kent said he believes Ron Lee plans, at least initially, to serve Country Coach owners who want to repair or modify their RVs, rather than build new ones. David Diamond, who is working with Lee on the start-up, said he couldn’t provide much information beyond what is on the company website.
But, he said, “Ron Lee has three goals: To save the property, to save the name Country Coach, and to bring back jobs to Lane County for so many workers that formerly worked for Country Coach, or the RV industry, or any industry that has gone away in our neighborhood.”
Lawyers for Country Coach Holdings LLC, its landlord and the government cleared the way Tuesday (Jan. 26) for the defunct RV maker’s assets to be sold at auction next week.
The Junction City, Ore., company is in Chapter 7 bankruptcy, meaning everything it owns — from office furniture to industrial equipment as well as motorcoaches — must be sold off to pay creditors, according to The Register-Guard, Eugene, Ore.
In this case, Wells Fargo Bank is the main secured creditor, meaning it gets paid first when Country Coach’s personal property is sold. If anything is left over, then other creditors would get paid.
Wells Fargo was owed more than $8.4 million when Country Coach filed for Chapter 11 bankruptcy last year. The Chapter 7 trustee, Ken Eiler, has estimated the auction will bring in more than $5 million. The auction is scheduled for Feb. 4 at the Country Coach plant.
The bank has agreed to set aside $200,000 to cover costs associated with administering the auction and winding down the company.
Country Coach owes Lane County about $100,000 in property taxes, and Wells Fargo and Lee Joint Venture, which owns much of the property on which the Country Coach plant sits, are working to pay off the tax debt, Eiler said.
Eiler has hired Commercial Industrial Auctions to conduct the auction with help from Hilco Industrial.
Four bus shells built by a third party will be omitted from the auction because of a dispute over who owns them.
Prevost, a Canadian manufacturer of bus chassis, said it provided Country Coach with four of its bus shells, valued at $500,000 each, but has never been paid. Under its business agreement with Prevost, Country Coach normally would take the shells on consignment, convert them into luxury motorcoaches and pay Prevost when it sold the coaches.
Christopher Kayser, a Portland attorney representing Prevost, said Wells Fargo is not entitled to the four bus shells because Country Coach never owned them. Wilson Muhlheim, a Eugene lawyer representing Wells Fargo, said Prevost allowed its security interest in the shells to lapse.
Troubled RV maker Country Coach Inc. has announced it will begin auctioning off its assets in the new year.
The announcement comes after a federal bankruptcy court ruling. The court ordered Junction City, Ore.-based Country Coach to auction off all its assets, including debtor-owned equipment, inventory and furnishings.
The auction is set for Feb. 4 at Country Coach. All the proceeds from the auction will be used to pay off the RV maker’s pending debts, according to KEZI-TV, Eugene, Ore.
Country Coach Inc. CEO Jay Howard went to court Wednesday (Nov. 25) hoping to negotiate survival of his company. He ended up bargaining for access to his own office at the Junction City, Ore., plant.
It was a negotiation he lost.
Wells Fargo — seeking the return of $8.2 million in loans it made to the now-bankrupt company — has posted a security guard at the plant, although Howard may later be allowed a supervised visit to pick up his personal items, according to The Register-Guard, Eugene, Ore.
“After 37 years of Country Coach, I find it difficult to believe that it’s done,” Howard said after the hearing. “But we’ll see. We will see.”
U.S. Bankruptcy Judge Albert Radcliffe ordered immediate conversion of the RV maker’s Chapter 11 reorganization bankruptcy — begun in March — into a Chapter 7 liquidation, although a trustee may not be on the job until Monday because of the Thanksgiving holiday.
The company had 1,600 employees two years ago. In November 2008, it shut down and put 500 remaining employees out of work.
After gaining the protection of the bankruptcy court, the company missed repeated deadlines for submitting a reorganization plan — in August, in September and again in October.
The company’s assets include 10 luxury coaches completed and ready for sale, with a total value ranging from $5 million to $9 million, depending on whether they’re sold at auction or sold retail, Howard said recently. There are an additional 15 partially built coaches.
As late as Monday, Howard was hoping to bring in an investor to buy out Wells Fargo’s debt and to allow the company to resume production.
The judge gave the investor, a Washington state businessman named Roger McCombs, until Tuesday to prove he was seriously interested in a purchase by depositing $1 million in a Wells Fargo account. Howard said Tuesday that another investment group that included Bryant Riley, who is both an owner and creditor of Country Coach, had put up $1 million in earnest money by the deadline.
Country Coach attorney David Levant told the judge Wednesday that an investor made a deposit at Wells Fargo, although it wasn’t in a specified account. “Wells Fargo should be able to verify the funds,” Levant said.
Radcliffe left it up to Wells Fargo whether to continue to seek a deal with potential investors: “The ball is pretty much in Wells Fargo’s court,” he said.
But the bank was done with the game, attorney Wilson Muhlheim said. “We’re not interested.”
County Coach’s descent into Chapter 7 liquidation wasn’t surprising to Junction City residents. When the company tried to crank up production after the bankruptcy filing, it managed only a skeleton crew.
“Pretty much everybody’s been assuming that’s what’s going to happen, and (they’ve) been trying to move on with their lives,” Jim Krowka, an employee at B&I True Value Hardware said. “(Company purchases) haven’t been a big part of our business for a couple of years now.”
City Administrator David Clyne said Wednesday night, “I’m hoping that there will be a surviving venture … and that someone will put something back together out of that. Most of the jobs have been long gone, and that’s a shame. But hopefully something will rise out of the ashes.”
“They had a good long run here but, unfortunately, the RV industry was hit very hard by the recession,” Clyne said.
The city has been moving in a different direction economically for some time, he said.
“We’ve been focusing on the prison and the hospital that are shortly to be constructed. … I think there was a realization that the RV industry has kind of come and gone. We’re looking to move forward and succeed in a different direction. Nonetheless, we’d hoped (Country Coach) would be part of it. Now, it doesn’t look good for them.”The city will still receive some property taxes for the land and buildings, he said, although this would be significantly less than the taxes Country Coach was paying at its peak. “I don’t know what the revenue shortfall will be. It will have an impact on our direct services and budget.”
“I feel bad for the local business creditors as well,” Clyne said. “They’ve extended credit, done what they could to keep the company afloat. I’m sure most of their assets are gone.”
As for the people who worked at Country Coach, he said, “They were friends, family, members of the community. I certainly feel for them.”
The company stopped building coaches in September and just recently laid off its remaining employees. Only Howard and Chief Financial Officer CFO Mark Anderson remained on the job.
Levant petitioned the judge to allow Howard and Andersen to stay in their offices and use company computers over the Thanksgiving weekend, continuing to look for investors to rescue the company.
Howard said Wednesday that he doesn’t want to give up. Most managers in the flailing industry are long since gone, he said, “We’ve fought a relatively valiant fight with a lot of people helping.”
But Wells Fargo objected to Howard and Andersen staying on at the plant. “It’s problematic,” Muhlheim said. “We don’t know what might or might not happen.”
David Wade, attorney for Lee Joint Ventures, which owns the land where Country Coach is located, said the company no longer had a lease as of Monday. “Technically there is no right of possession for (Country Coach),” he said.
Radcliffe ruled that Howard and Andersen would be barred from the property, at least until next week when a trustee takes control of the property.
The pair “can take a few days off for want of a better way of putting it,” the judge said.
Afterward, Howard admitted that the fate of Country Coach was no longer in his hands, although he added that he’s still optimistic that something positive for “jobs and the community” will happen.
In the meantime, Howard said he would spend a lot of time over the holiday with his 81-year-old mother, who’s recuperating from knee replacement surgery.
Country Coach Inc. has lost $3.7 million over the past three months, a company official said Wednesday (June 24), but the Junction City, Ore.-based RV maker remains hopeful it can emerge from bankruptcy and attract investors sometime in 2010.
Testifying in U.S. Bankruptcy Court in Eugene, Ore., CFO Mark Andersen provided an overview of the company’s operations two months after it resumed production of luxury motorhomes at its Junction City factory, according to the Register-Guard, Eugene.
Judge Albert Radcliffe, after hearing evidence and arguments on a series of motions involving the company’s operations, summed up the company’s position as “precarious, but not hopeless.”
Radcliffe has set an Aug. 31 deadline for Country Coach to file a reorganization plan because its $11.5 million financing plan with Wells Fargo expires Dec. 31. On Wednesday, the judge denied Country Coach’s request to extend the deadline, but said he would reconsider if Wells Fargo agrees to provide financing beyond the end of the year.
Andersen said Country Coach is working with Wells Fargo Bank, its main creditor, on a new budget that would enable it to keep operating into the new year. And it wants to “establish a consistent pattern of sales” over several more months before approaching potential investors, he said.
Privately held Country Coach ceased production last November and filed for Chapter 11 bankruptcy protection in March.
Andersen said the company has sold six coaches since resuming production in April, and has taken a deposit for a seventh. But because it hasn’t met the sales goal it agreed on with Wells Fargo, Country Coach finds itself in default.
The bank is continuing to support Country Coach reorganization efforts, however, he said – an assertion that bank attorney Loren Scott confirmed to the judge.
About 120 employees are working at the plant, and the company may add 10 more in July and 10 more in the fall, Andersen said.
Sales have been slower than Country Coach anticipated, Andersen said. The bankruptcies of RV makers Monaco Coach Corp. and Fleetwood Enterprises Inc. earlier this year have driven down the price of motorhomes, he said.
Country Coach has been selling its motorhomes for 96% of its cost, he said. “Prices are holding up reasonably well,” he said.
June, July and August are typically the busiest sales months for motorhomes in the Northwest, Andersen said, and the company was hopeful that sales would pick up this summer.
Under questioning from Rebecca Kamitsuka, attorney for the U.S. Trustee’s Office, Andersen said Country Coach has lost $3.7 million in the past three months.
Kamitsuka objected to the company’s request that it be allowed to refund about $30,000 to Country Coach owners who paid money to attend a company-sponsored rally last year in Georgia that was canceled. She said creditors and employees owed vacation wages should be paid first.
But Andersen said the company faced a “significant backlash” when the rally was canceled and people lost their deposits. Each one of those people is a potential buyer of a Country Coach, he said, and “it’s critical for them to feel good about the business.”
The company views the move to refund those deposits as a marketing expense, he said.
Radcliffe agreed and allowed the company to reimburse the customers.
The judge also agreed to give Country Coach another 90 days to decide whether to renew or reject its lease with Lee Joint Ventures for its factory. Lee Joint Ventures objected to the extension, but Radcliffe granted the company’s request, which gives it until Oct. 1 to make a decision.