With a major construction project at Jayco Inc.’s headquarters in Middlebury, Ind., nearing completion and perhaps 150 new jobs coming to the firm, things are looking good in the recreational vehicle industry.
According to a report by the Elkhart Truth, that was one of the messages from U.S. Rep. Jackie Walorski and a top official at Jayco, which the lawmaker visited Monday, May 13.
“They seem very optimistic and, boy, if they are, I am,” said Walorski, a Republican from the Elkhart area. She was at Jayco for a tour of the firm’s motorhome division, one of several planned stops at Elkhart County RV companies, the main economic motor here.
Jayco COO Jim Jacobs said things may not be where they were in the sector in 2006 or 2007, before the Great Recession hit, pulling the rug out from under the RV industry. They’ve definitely improved, though, with an upswing in interest in RVs and positive signs from RV dealers and participants at RV trade shows.
“Certainly we’re miles ahead of where we were in 2008, 2009,” said Jacobs, speaking after Walorski’s Jayco stop.
To read the entire Elkhart Truth article click here.
The RV industry is on its way back in Indiana, and Elkhart County has a lot to do with it.
According to a Goshen News report, Indiana Gov. Mike Pence made a brief appearance in Middlebury Thursday (April 18) afternoon to help celebrate the recent expansion plans of up-and-coming RV manufacturer Grand Design RV LLC.
Surrounded by Grand Design executives, employees, team members, suppliers and their family members, Grand Design President and co-owner Don Clark announced that in the next 60 days the company plans to launch its second line of RVs — a launch which could potentially bring as many as 120 new jobs to the county.
Started by RV veterans Clark and brothers Ron and Bill Fenech in late 2012, Grand Design’s first RV unit, the extended-stay fifth-wheel known as the “Solitude,” rolled off the line on Jan. 15 to rave reviews.
“Our entry into the marketplace, the “Solitude,” has been very well received by the retail buyers — so well received that I am pleased to announce that in the next 60 days we will begin manning and staffing for Line 2,” Clark said. “Our Line 2 will produce a smaller, mid-profile fifth-wheel. After the ramping up stage of Line 2, we intend to bring approximately 120 more jobs to the community. These are exciting times for Grand Design.”
Clark told RVBUSINESS.com that Grand Design currently has 87 U.S. dealers selling the Solitude line. “As production keeps up, we’re starting to bring more dealers into the fold,” he said, adding that the company had shipped more than 200 units to its dealer body.
Ron Fenech noted, “We’ll add more dealers. You know, maybe by the end of the year, I could see us being at maybe 120 or 130 dealers, and we’ll have three product lines up and running for the 2014 season. That’s probably a pretty accurate projection of where we’re going to be.”
He told RVBUSINESS.com that good timing factored into the company’s growth with the industry on an upswing. “Yeah, I think that dealers are pretty optimistic,” Fenech said. “It’s always a battle. There is tremendous competition. But the timing never worried me. I just felt it was a good time for us because we had a great story to tell and I think we bring something different to the marketplace. We’re benefiting, though, by the fact that the dealers are optimistic and that allows them to make choices a little bit easier.”
According to the Goshen News, Pence termed Grand Design’s expansion plans as “exciting news for all of Indiana as well,” especially when coupled with Grand Design’s recent pledge to bring as many as 500 new jobs to the area by 2016. That’s a pledge the company has to keep if it wants to take advantage of up to $2.85 million in conditional tax credits and up to $200,000 in training grants recently provided to the company by the Indiana Economic Development Corp. Such tax credits are performance-based, meaning until Hoosiers are hired, the company is not eligible to claim incentives.
“When I was first elected governor, I said we were going to make job creation job one, and today is a great example of how Hoosier entrepreneurs and Hoosier workers are coming together to create new jobs and opportunities and are bringing Indiana back,” Pence said. “Grand Design launched in the fall of 2012 and has been on a tear ever since, with plans to produce more than 1,750 units this year. We appreciate their commitment to quality and to service. This is a great moment for Elkhart County and the RV industry.”
Pence went on to thank the company for its decision to locate its headquarters and manufacturing operations in Indiana and for throwing its support behind the workers of Elkhart County.
“The desire of this company to set up a “Grand Design” here in Middlebury in Elkhart County is a tribute to many things, but it’s mostly to the skill, to the character and the work ethic of the people of Indiana, and particularly of Elkhart County,” Pence said. “We look forward to your continuing and abounding success. You are proving today two things: the Hoosier RV industry is coming back, and Indiana is open for business.”
According to the Goshen News, Elkhart County Council member Dave Hess also had some words of thanks and encouragement for the fledgling RV company during Thursday’s gathering.
“Things have turned the corner, and things are improving in Elkhart County, and I think it’s a real testament to the outlook and the vision of these fine business people we’ve got here, and the fact that they chose Elkhart County not only to locate their industry, but to grow and expand their industry as well,” Hess said. “They could have probably gone anywhere they wanted to, but they chose Elkhart County because of our entrepreneurial spirit, our expertise in the RV business, and most of all, you people standing right out here, the workers in this county. I think it’s because of companies like this that the future of Elkhart County is very bright.”
Clark also anticipates hiring up to 10 more people to work the original line.
“Today is a great example of how Hoosier businesses and Hoosier workers are coming together to create new jobs and opportunities and are bringing Indiana back but it’s companies like this that are making it happen,” Pence says.
Anyone interested in one of the new positions all you have to do is stop by Grand Design RV’s office in Middlebury to apply.
Indiana, the manufacturing center for the RV industry, was ranked as the best place to do business in the Midwest and the fifth best nationwide in the Pollina Corporate Top 10 Pro-Business States for 2012 study, co-published with the American Economic Development Institute. According to a news release, this is the fourth ranking in less than a year in which the Hoosier state’s business climate has scored a top 10 finish nationally.
The Pollina Corporate Top 10 Pro-Business States study, now in its ninth year, is based on 32 factors controlled by state government, including taxes, human resources, education, right-to-work legislation, energy costs, infrastructure spending, workers compensation laws, economic incentive programs and state economic development efforts. Indiana’s ranking in the report has moved up 18 places since 2010, earning it the title of “most improved state” this year.
“Indiana’s pro-business policies and solid fiscal house continue to earn national attention as a frontrunner for new jobs and investment,” said Dan Hasler, secretary of commerce and CEO of the Indiana Economic Development Corp. “This ranking is the latest validation of this administration’s focus since 2005 to make economic development efforts a top priority. Above all else, business climate matters and the payoff for Hoosiers is new careers and opportunities.”
Indiana’s fifth place ranking makes it the only Midwestern state and the only Northern state in the publication’s top 10. Among neighboring states, Kentucky ranked 28th, Ohio ranked 20th, Michigan ranked 39th and Illinois ranked 48th.
The federal government is making automakers meet tough new fuel efficiency standards, which is making some in the RV industry nervous, according to a report by WNDU TV, South Bend, Ind.
“For light trucks and the light truck category, which includes SUV’s – which is really the category that tows our products primarily – they need at least 28 miles a gallon by the year 2016 as an average,” said Jayco Inc. President Derald Bontrager during the 2011 Elkhart Economic Development Summit held at the Lerner Center Thursday (Oct. 13).
The tough new standards come at a time when the RV industry has never been more reliant on tow vehicles to survive as around 80% of all RV products being shipped today are towables. The question becomes, can the auto industry meet the new fuel efficiency standards while continuing to meet the towing needs of the RV enthusiast.
“There’s a concern that the availability to the consumer of vehicles that are able to tow the products we build will be less accessible in the future,” said Bontrager. “And it’s just not our industry, think of the horse trailer industry, and construction industry. We still need products out of Detroit to be able to tow many different forms of RVs or trailers or whatever it might be.”
The concern was voiced at a time when some finally see the economic glass as half full.
“The 10% reduction in unemployment here basically came back through the RV industry – they’re good, they’re resilient, they know what to do, they’ve been up and down a lot of times,” said Elkhart Mayor Dick Moore.
“The RV industry, as Jayco has, has seen pretty steady growth and we have hired back,” said Bontrager. “We had a job growth of about 50% since our low point in 2009 and we see that continuing to grow.”
The state of the RV industry, especially locally, is to a degree a fairly good barometer of how Elkhart County is fairing economically. It’s not out of the woods yet, but it is heading in that direction. That fact was supported by the recent distinction that the Elkhart-Goshen area was named one of the top areas in the country for the growth based on the value of what they make.
“Elkhart County as a whole is seeing some recovery. We have seen about $45 million worth of new investments so far this year and right around 1,400 new jobs announced,” said Dorinda Heiden-Guss from the Elkhart County Economic Development Corp. “We’ve already announced in Elkhart County, $46, just shy of $47 million worth of expansion projects.”
As for the future and the fuel economy standards, the RV industry has been experimenting with new materials to make units lighter and more aerodynamic, but the waters it’s wading into are still uncharted.