The pending loss of 450 jobs at Monaco RV’s plant in Coburg, Ore., strikes yet another blow to Lane County’s frail RV manufacturing industry.
But, according to a report in the Register Guard, Eugene, several people in the industry predict that, as bad as things look now, local RV manufacturing will re-emerge when the national economy recovers.
It will look different, however, from the glory years before the recession when scores of large, gleaming luxury motor coaches came off the assembly lines at Monaco Coach and Marathon Coach in Coburg and at Country Coach in Junction City.
Industry insiders say the area probably will never churn out the volume of high-end, luxury motor coaches it once did. Instead, RVs will be smaller, lighter, more aerodynamic and more fuel efficient, and Lane County could create a new niche as an eco-friendly innovator, they say.
“I don’t expect to see the type of numbers of manufacturing in the high-end that there was in the past; I don’t expect to see that ever return,” said Ron Lee, who early this year resurrected Country Coach — a company founded in 1973 by his brother, Bob Lee — although in a much smaller version.
While running a 22-employee parts, service and consignment sales operation in Junction City, Lee also is trying to raise money to begin limited manufacturing of a 40-foot Country Coach model priced at $550,000 to $700,000. Once the factory has been producing for three years, Lee said, he plans to unveil a diesel/electric hybrid coach.
“That’s a direction we have to go,” Lee said. “Green manufacturing processes and also more fuel-efficient vehicles — that’s something we have to do.”
Others in the industry say developing greener RVs is a natural fit for Lane County.
“We are so big on solar and alternative energy,” said Shannon Nill, general manager of Guaranty RV in Junction City. “I do think Oregon is a hotbed of innovations of this nature, and there’s no reason it can’t apply to RVs — it already is.”
It is still possible today for entrepreneurs to follow in the footsteps of RV pioneers, such as Bob Lee, to bring new products to market, industry insiders said.
“It’s a very entrepreneurial industry — it has been since the ’20s,” said Al Hesselbart, historian for the RV/MH Hall of Fame in Elkhart, Ind.
Indiana produces about 80 percent of the RVs made in the United States today, according to the RV Industry Association.
In Indiana, several start-up companies, including Evergreen RV and Earthbound RV, have emerged from the ashes of the recession and been quite successful, Hesselbart said. Both are “super-green, eco-friendly oriented companies,” he said.
Nill said the hot area for growth in this economy is trailers, smaller motorhomes and pre-owned motorhomes, all of which are cheaper than the large, luxury RVs.
If demand for high-end coaches bounces back, Lane County could meet that demand because the know-how is still here, said Frank Magdlen, a former RV industry analyst. He said he now works in investment banking for reasons unrelated to the demise of Oregon’s RV industry.
“Currently I don’t think there’s very many barriers to entry if you’re going to supply a niche segment,” he said.
“One thing the major manufacturers would tell you is it doesn’t take a lot of capital, so the guy with a barn or excess space can get in the business,” Magdlen said.
“It’s not robotics that puts the stuff together like an automobile, so it remains a labor-intensive business as opposed to capital-intensive,” he said.
Watch today’s Video #2, courtesy of KVAL-TV, Eugene, Ore.
The service bays are full at the resurrected Country Coach in Junction City, Ore., proof for owner Ron Lee that the RV business still has a pulse.
Breathing new life into the ailing industry is one of the jobs of the Oregon RV Alliance, a non-profit marketing group that formed in December.
“I believe it’s going to be a big asset to our business here,” Lee said.
“The goal is, our mission statement is to expose RV owners to the benefits of spending their leisure time here in Oregon,” said Brad Waring, the alliance’s executive director.
So far, 40 RV dealerships, service centers, community festival groups and local winers have joined the alliance – and membership is growing.
“We really are as entrepreneurs collaborating and kind of doubling up all our efforts,” said Danuta Pfeiffer from Pfeiffer Winery.
The idea is to market Lane County as an RV destination for people coming to service their rigs and check out the sights.
“So why not take advantage of that and focus them on us and our location here?” Lee said.
There is an RV rally going on in Harrisburg, attracting visitors and helping a broader segment of the economy beyond just manufacturing.
“This is going to be a resurgence of our part of the RV industry here. What we’re doing is to bring it back.”
“We are really muscling our way into a showcase area for our visitors,” Pfeiffer said.
Watch today’s Featured Video courtesy of KVAL-TV, Eugene, Ore., to learn more about the following story.
The future scares Margie ReGester.
“I want to be around for my grandkids,” ReGester said.
She lives on $553 a month. Country Coach laid her off three years ago, and she hasn’t been able to find work since. KVAL News interviewed ReGester when her COBRA ran out in January 2009.
Since then, like 73,000 other people in Oregon’s Lane County, ReGester’s been without insurance.
On Sunday (July 25), ReGester found herself surrounded by RVs once again. She wasn’t an employee. She was a patient.
Cascade Medical Teams rented out Monaco RV’s health clinic in Coburg, Ore., July 24-25. More than 100 volunteers, doctors and nurses treated and diagnosed people without health insurance at no cost.
Cascade Medical Teams usually provides free medical care in Guatemala. They recently decided the need was just as big in their backyard.
“We just felt that we needed to provide some of the expertise we’ve developed in doing the kinds of things we’ve done out of the country here in Lane County,” Cascade Medical Teams Board Member Bruce Mulligan said.
For ReGester, the clinic meant answers.
“Now I know why I’ve been so light-headed and dizzy and having these episodes I’ve been having,” ReGester said.
Without insurance she can’t afford doctors visits or medicine for her high blood pressure. At the clinic, Dr. Richard Barnhart did it all for free. The treatment doesn’t end there. On her way out, ReGester made a follow-up appointment at a low-income clinic. It’s a relief, she said, and it’s making her feel better.
“I’m sure my blood pressure has already gone down,” ReGester said.
The clinic served just under 200 people this weekend. Organizers said they were hoping for more patients. They are planning another free clinic in a few months and want to move it to a more central location.
Everything must go.
Everything that isn’t bolted down in the sprawling Country Coach Holdings LLC plant in Junction City, Ore., is to be sold at auction today (Feb. 4) and Friday, with proceeds going to satisfy creditors of the bankrupt RV manufacturer, according to The Register-Guard, Eugene, Ore.
Copiers, cabinets and couches. Sanders, saws and routers. Generators, flat-screen televisions and microwave ovens. Enough nuts, bolts, washers and screws to stock a hardware store.
Pallets stacked with company documents, including such intellectual property as blueprints, schematic drawings, parts lists and customer lists are up for bid, as are pickup trucks, minivans, golf carts, and of course, Country Coach’s signature, über-luxury motor homes.
Even the contents of former CEO Jay Howard’s office — including his business books, desk and three safes — are up for bid.
It’s a sobering end for the once high-flying Country Coach, which at its peak employed about 2,000 Lane County area residents.
In all, some 1,600 lots will be sold at auction, to buyers who show up at the plant to bid in person, by phone or via the Internet. As of Wednesday, the auctioneers had registered 335 bidders in-person, and another 150 who intend to bid online, said Rob Beal of Commercial Industrial Auctioneers in Portland, which is conducting the auction in partnership with Hilco Industrial.
(You can follow the auction online at www.hilcoind.com.)
The big-ticket items are 10 completed motorcoaches, which in ordinary circumstances would have had retail prices ranging from $400,000 to $900,000. In addition, 17 coaches in various stages of completion will be auctioned as well.
Beal wouldn’t hazard a guess at what the auction will yield. Conceivably, a single bidder could submit a bid for everything with an eye toward restarting the business or starting a new company.
“It’s been entertained,” Beal said. “But no one could come up with the cash to keep creditors and the (bankruptcy) trustee happy.”
Country Coach filed for Chapter 11 bankruptcy last winter to gain breathing room from creditors while it attempted to reorganize its finances. The company resumed production with a skeleton crew last April at a rate of one coach per week, but shut down again last fall amid faltering sales. In November, a judge converted the case to a Chapter 7 bankruptcy and ordered the company’s assets liquidated to satisfy creditors — namely Wells Fargo Bank, the company’s main secured creditor.
Prospective bidders include other RV manufacturers, contractors, cabinet shops, welders, fabricators, dealers and individuals like Bob Relyea, a retiree who traveled from Dallas, Texas. Relyea said he’s interested in buying one of the finished coaches, if he can find a bargain, to replace his 2000 Country Coach Magna.
“It doesn’t hurt to come and take a look,” he said.
Dan Russell, a partner in Oregon RV Repair, an RV service center in The Dalles, was checking out parts, many of which are “too fancy” for the vehicles his business deals with.
Ed Read and Pat Mason from Oregon Motorcoach Center, an RV service facility started by Country Coach founder Bob Lee, were checking out parts and materials they may bid on for their business.
Read worked at Country Coach for nearly 32 years and said it was “terribly sad” to see the once-proud company being sold off in pieces.
“I put a lot of my life into this company,” he said. “I never thought it would come down to this.”
Bert Bergman of Port Townsend, Wash., was looking for stuff that could have marine applications that he could resell on his eBay business, Spit in the Ocean.
“Most of the stuff in these land yachts you can use in a boat,” he said.
As he walked through the cavernous paint shop, Bergman said it was sad, in a way, to see an RV maker get liquidated.
“On the other hand, these dinosaurs got to get off the road,” he said. “So maybe we’re just putting the rich out of their misery.”
Virtually the entire sprawling plant, including the executive offices, was open for prospective bidders to walk through. Former CEO Howard’s office contained remnants of his tenure, including three safes, a portrait of Howard and Country Coach founder Bob Lee in happier times, and a framed copy of a 2007 New York Times article about Country Coach and other RV makers, headlined “Housing Crisis? Try mobile McMansions.”
A dozen or so books were stacked in three piles on Howard’s granite-topped desk. Titles included such business bibles as “Good to Great,” “The Way of the Guerilla,” “Guts! Companies that Blow the Doors off Business-as-usual,” and “Letitia Baldridge’s New Complete Guide to Executive Manners.”
At the bottom of one stack was a book that hinted at the stress Howard was under as he fought to keep his company alive over the past year: The Mayo Clinic’s “Five Steps to Controlling High Blood Pressure.”
It’s the economy, stupid.
That may have been the message from the 441 readers who participated in this year’s online poll for the top 10 local stories of 2009, according to The Register-Guard, Eugene, Ore.
Sure, the Rose Bowl-bound University of Oregon football team has provided a delicious diversion from the fiscal anxiety that has bedeviled Lane County residents these past 12 months.
Yes, controversy over when Eugene police should and should not use Taser stun guns has spurred a worthy community debate.
And it’s a good bet 2009 will be associated for a long time with a two-word medical prognosis: “swine flu.”
But for readers who know too well the realities of economic struggle — job loss, home foreclosures, wage freezes — there was really only one choice for the year’s top story: the recession.
It was a story that revealed itself in myriad ways — from record applications for food stamps to a suddenly common corporate coping strategy: putting workers on unpaid furloughs.
For several months, the unemployment rate in Lane County reached heights not known in decades — 12, 13, 14%. It was sometimes easy to forget the human equation in those percentages: It meant that at least one worker in every eight wasn’t working.
By year’s end, economists were declaring that the recession had ended, or was about to end, while acknowledging that the economy wasn’t strong enough — yet — to create many new jobs. Still, many felt there was reason to be optimistic about 2010.
The sour economy surfaced in other ways, too: The struggles of the local recreational vehicle industry in general, and Junction City-based Country Coach in particular, was judged the year’s No. 9 story. By year’s end, Country Coach was effectively defunct, while Monaco Coach Corp., once a high-flying publicly traded company based in Coburg, became a tiny division of a multinational corporation.
By October, 1,400 people in Lane County were working in the RV industry, a fraction of the 4,500 employed four years earlier.
Luxury motorhome maker Country Coach LLC managed to stave off liquidation for a little longer on Tuesday (Nov. 24), according to the company’s top executive. But the company’s future remains as murky as ever, according to The Register-Guard, Eugene, Ore.
An investment group that includes a banker who is both an owner and creditor of the RV maker put up $1 million in earnest money by a court-imposed deadline Tuesday, Country Coach CEO Jay Howard said.
The move buys a little time for investors to negotiate a deal with Wells Fargo, the Junction City, Ore., manufacturer’s main creditor, he said.
In bankruptcy court on Monday, Wells Fargo’s attorney Wilson Mulheim, said Country Coach has consistently defaulted on its loan agreements.
The investors now have until Dec. 3 to hammer out a plan with Wells Fargo to assume the $8.2 million loan the bank made to Country Coach on April 1, Howard said. The cash enabled the company to continue to operate while in Chapter 11 bankruptcy, he said.
No information regarding these developments had been filed with the U.S. Bankruptcy Court by closing time Tuesday.
Howard said County Coach has cleared an important hurdle on its path to recovery.
“It’s a huge step,” he said. “It’s a show of faith in the future of Country Coach and allows us the opportunity with the court to remain in Chapter 11 for some period of time and reorganize our company successfully.”
The move is the latest turn in Country Coach’s lengthy bankruptcy saga.
The same investor that pushed Country Coach into Chapter 11 reorganization bankruptcy in March now is leading the charge to try to prevent the court from converting the case into Chapter 7 liquidation bankruptcy.
That investor is Bryant Riley, a Los Angeles investment banker, who led the investment group that bought Country Coach from National RV Holdings for $50 million in 2007.
One of his companies, Riley Investment Management, or RIM, is a Country Coach creditor.
Howard said an investment group composed of Riley, RIM and businessman Lloyd Miller put up the $1 million on Tuesday.
Howard said Tuesday afternoon that he anticipated that Washington state businessman Roger McCombs also would deposit $1 million in the Wells Fargo escrow account by the Tuesday deadline.
McCombs could not be reached for comment Tuesday, and Howard did not return a call Tuesday evening asking if McCombs had made the deposit.
McCombs has expressed interest in building motorcoaches at the Country Coach plant, as well as mobile medical coaches, using Country Coach’s chassis, and furthering his maglev, or magnetic-levitation, technology, Howard said.
“If the McCombs plan comes to fruition, it could involve thousands of jobs over the next 18 months,” Howard said. “It takes us far beyond motorcoaches.”
Country Coach stopped building coaches in September, Howard said. The company, which employed about 1,600 people just two years ago, now is down to just two employees: Howard and Chief Financial Officer Mark Anderson.
Junction City, Ore., RV maker Country Coach is heading for liquidation unless a last-gasp bid by an outside investor to settle the company’s debts and bring it out of bankruptcy comes to fruition in short order, according to The Register-Guard, Eugene, Ore.
In U.S. Bankruptcy Court on Monday (Nov. 23), lawyers for the company and its main creditor, Wells Fargo Bank, said Country Coach is out of money and out of options, unless a Washington businessman named Roger McCombs can secure a stay of execution. If McCombs deposits $1 million in earnest money in a Wells Fargo escrow account by this afternoon, he’ll have 10 days to negotiate a deal to pay off the debt to the bank and attempt to breathe new life into the company.
Privately held Country Coach, founded in 1968, has been in Chapter 11 bankruptcy since March, providing it with some breathing room from creditors while it sought to reorganize its finances and business model. But even operating with a vastly smaller work force, the company has been steadily losing money. The company has posted losses of $8.8 million since April, company officials testified.
Wilson Muhlheim, the Eugene attorney for Wells Fargo, said Country Coach has consistently been in default on the terms of its loan agreement. Company officials said they have a negative balance of $450,000 on their line of credit with the bank.
“Now we’re at the end of the road,” Muhlheim said. “There is no deal on the table.”
But Country Coach CEO Jay Howard said there could be a deal. He testified that he’s been talking with McCombs since July, that McCombs toured the Country Coach plant in October, and that he’s serious about making a bid.
McCombs is founder and board chairman of Composite Power Corp. and the patent holder of the company’s composite energy delivery system, according to the company’s website. The company, based in Richland, Wash., with an office in Las Vegas, makes utility poles made from composite materials that are lighter, stronger and cheaper than wooden utility poles, and which don’t have to be treated with carcinogenic chemicals, like wood poles, according to the financial website The Hot Pinks, which follows companies whose stocks are traded over the counter.
“He’s an amazing entrepreneur,” Howard said outside court.
In addition to building motorcoaches at the Country Coach plant, McCombs is interested in building mobile medical coaches, using Country Coach’s chassis, and in utilizing magnetic-levitation technology, or maglev, an area in which he holds a patent, Howard said.
“By Dec. 3 we’ll know if McCombs is in or out,” Howard said. “If not, we have no other sponsor.”
Howard said an earlier proposed deal, involving a Texas company called Recreation Live and other investors, appears dead.
If the McCombs deal doesn’t come together, Country Coach’s Chapter 11 case will be converted to Chapter 7 for the purpose of liquidating the company’s assets, Rad cliffe ruled.
Howard said the company has 10 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. The company has another 15 coaches that are in progress.
Howard said the company stopped building coaches in September and just recently laid off the remaining staff. Only Howard and CFO Mark Andersen remain on the job, he said.
Even if McCombs is able to strike a deal with Wells Fargo, he’ll also have to come to terms with Country Coach’s landlord, Lee Joint Venture.
David Wade, the landlord’s attorney, said the Lee group was prepared to begin eviction proceedings unless someone makes good on $160,000 owed in property taxes and $263,000 to repair the roofs of the factory buildings.
Country Coach, the financially ailing Junction City, Ore., RV maker, has yet to file a reorganization plan to get itself out of bankruptcy. And now a judge is demanding that company officials explain why he shouldn’t order that its assets be liquidated, according to The Register-Guard, Eugene, Ore.
A hearing on Country Coach’s Chapter 11 bankruptcy case is set for Oct. 22, at which time company officials will have to convince U.S. Bankruptcy Judge Albert Radcliffe that it has a viable plan for returning to profitability. If not, Radcliffe could order the case converted to a Chapter 7 case, which means its assets would be sold off to satisfy creditors, or he could dismiss the case outright, which would allow creditors to sue to seize the company’s assets.
The hearing could mark a turning point for Country Coach, which filed for bankruptcy protection in March so it could reorganize its finances while getting breathing room from creditors, chief among them California-based Wells Fargo Bank.
Country Coach, a privately held maker of luxury motorcoaches, closed its Junction City plant in November, putting about 500 employees out of work. It resumed production in April, although on a much smaller scale. Company officials have said between 100 and 120 employees have been working at the plant, turning out about one coach per week.
Company spokesman Matt Howard said Wednesday (Sept. 23) the plant has been shut the past two weeks, but the company is planning to reopen Monday. He declined to comment on legal issues.
Since it resumed production in April, Country Coach has posted losses of $6.8 million, according to a financial statement it filed with the court Sept. 15.
Judge Radcliffe initially set an Aug. 31 deadline for Country Coach to file a reorganization plan. That was extended, at the company’s request, to Sept. 15. Radcliffe said he wouldn’t consider further extensions unless Country Coach’s main creditor, Wells Fargo, agreed to extend its financing past Dec. 31. Country Coach lawyer Brandy Sargent said in a motion that Wells Fargo had agreed to extend the financing through Feb. 15 and asked that the deadline for filing a plan be extended to Oct. 15.
Sargent said the company recognizes that “there remains a material risk that it will not be able to proceed to confirmation of its plan,” and she outlined a series of hurdles Country Coach must clear to get its plan confirmed by the court. Those include coming to terms with its landlord, Lee Joint Ventures, with Wells Fargo, and with its would-be partner, Recreation Live LLC.
The U.S. Trustee’s office, meanwhile, objected to the company’s request for another extension. The company has not filed documents supporting its assertion that Wells Fargo has agreed to extend its financing, nor has Wells Fargo filed any documentation indicating that it agreed to an extension, according to a brief filed by Rebecca Kamitsuka, attorney for the U.S. Trustee.
Further, Kamitsuka said, when she asked a Country Coach lawyer for a copy of the loan modification agreement, he faxed her a single-page document, marked as Page 6 of 6, with just a signature page, but without the text of the agreement.
Country Coach, Kamitsuka wrote, “cannot hide the ball on these matters in its fiduciary capacity.”
Luxury motorcoach manufacturer Country Coach today (Aug. 26) announced the successful sale and export of the company’s first motorcoach to China. The motorcoach, a 2009 Allure 470 Veranda, was shipped from the port of Everett, Wash., directly to the port of Dalian in northeastern China.
Company managers are cautiously optimistic about Country Coach’s growth opportunities in the burgeoning China market.
“While we have been exploring potential inroads into China, in this case the importers sought us out. It is gratifying to know that our quality and innovation are ideally suited to their market needs,” said Jay Howard, Country Coach president and CEO.
The company’s clients in China selected the Allure 470 with the Veranda feature due to the coach’s reliability, spacious floorplan and unique balcony feature. They intend to deliver the motorcoach to regional celebrity clientele, who will use it to live in and interact with their fans from the Veranda.
“The new owners look forward to enjoying China’s natural beauty from the Veranda, as well as the opportunity to visit with their fans while staying above the crowds,” said Jim Howard, senior vice president of sales and service.
Luxury motorcoach manufacturer Country Coach today (Aug. 25) announced the successful completion of the company’s 23rd Annual West Coast Class Reunion Rally. Held in Albany, Ore., Aug. 19-23, the rally combined learning, fellowship, shopping and adventure.
More than 150 Country Coach motorcoaches, with more than 300 avid coach owners, joined the company for the multi-day event, according to a news release.
Company President and CEO Jay Howard reported positive results from the rally.
“It was encouraging to share time with owners and other stakeholders who have been on our company’s difficult journey with us,” Howard said. “I am grateful that so many chose to visit with us in Albany this year, and that many have purchased a new Country Coach or are considering a purchase in the near future.”
At the time of this release, Country Coach Factory Direct has sold nine motorcoaches in conjunction with the Class Reunion Rally, and consultations are ongoing with additional clients searching for their ideal Country Coach.
Howard added, “We are always pleased and grateful when clients select a Country Coach, and it serves as an affirmation of our dedication to caring for our customers. However the success of this rally is not measured in retail sales alone. Our rally attendees did not drive across the country to Albany, Ore., for free service or any other incentive. Overwhelmingly, attendees came to support Country Coach and each other. It was a great few days, and people left smiling.”
The company, based in Junction City, Ore., is currently exploring locations in the Southeast United States for a pending winter rally.