The former general manager of now-defunct Weekend Warrior Trailers Inc. intends to create a line of private-label travel trailers designed by former Weekend Warrior President Mark Warmoth.
“From a distance, we always had that in mind,” said Larry Broyles, president of Poker Clothing Inc., dba Warrior Lifestyles, Perris, Calif.
Warrior Lifestyles’ new Legend travel trailers will debut Aug. 7-9 at the “Dune Tour” in the Oceana Dunes near Pismo Beach, Calif., an event that should draw tens of thousands of outdoor recreationists to 5 1/2-miles of ocean-front dunes.
“We aren’t doing any RV shows,” Broyles said. “We are going right to the consumers. We are going to give something to a new generation of RVers and campers.”
To advertise the new trailers, Warrior Lifestyles will distribute 60,000 trash bags to people attending the event.
Warrior Lifestyles was founded in September 2008 two months after Warmoth shut down Weekend Warrior’s operation in Perris and returned its inventory of finished trailers and parts and components to its creditors. The company retails accessories and provides parts and service for Weekend Warrior — once a popular West Coast brand — Rage’n and Extreme travel trailers in stores in Perris and Lake Havasu City, Ariz.
Warrior Lifestyles currently stocks about 20 new Weekend Warrior SURVs at the two locations that were acquired from the bank.
“I helped liquidate the company so it was an opportunity to buy stuff during a distress sale,” Broyles said. “Right now, you can buy them back from the bank cheaper than you can build them, unfortunately.”
Warrior Lifestyles also acquired most of Weekend Warrior’s parts inventory and mailing lists. The company employs about 40 people at the two locations, about half of whom perform service on travel trailers.
Weekend Warrior, founded in 1988 and credited with starting the towable sport utility (SURV) trend, at one time employed about 2,000 people in four plants totalling more than 215,000 square feet in Perris.
The new line of trailers will be built in a factory that once housed Weekend Warrior subsidiary Extreme Warrior Manufacturing LLC in Caldwell, Idaho, under the direction of former Extreme President Don Day.
“We are writing a business plan right now,” Day told RVBusiness. “We are going back after that cult-like following that Warrior has. Mark is designing the product for us, but that’s as far as his involvement goes. There isn’t anybody better in the toy hauler market than Mark. He connects with that buyer.”
In addition to towable SURVs, Day said, the company also intends to build conventional travel trailers and fifth-wheels at some point in the future.
With an initial production schedule of five units a week, the first 400 trailers are to be sold at the Warrior Lifestyles stores in Perris and Lake Havasu City.
After that, Warrior Lifestyles dealers will be “factory certified” and need to agree to sell “branded consumables” such as Warrior Lifestyles trailer accessories, clothing and bottled water, much like Harley-Davidson motorcycle dealers who are an extension of the Harley-Davidson brand.
“We are going to start up very slowly and build from there,” Day said. “We’ve been contacting dealers, and we’ve had a lot of interest for obvious reasons — that Warrior name is so strong.”
More than 120 members of the North American Heartland Owners Club began arriving in Goshen, Ind., today (June 10) to celebrate the kick-off to the fourth annual Heartland RVs Owners Rally. The event, held at the Elkhart County 4-H Fairgrounds, runs June 11-14.
The program is hosted by Heartland Owners Club, an association launched in November 2008 for members of Heartland Recreational Vehicles LLC fifth-wheels and travel trailers.
While members frequently meet in regional activities, the annual owners rally is the largest event on the club calendar.
“Of the 272 registered club members, more than 45% are able to join us for this year’s event,” said Coley Brady, Heartland’s director of sales. “We are very pleased that we are able to attract such a high number of our North American Club member owners.”
This year’s national rally is particularly appealing to club members in that it is being staged near Heartland RV’s Elkhart headquarters. As a consequence, the usual menu of social and educational activities will be augmented with trips to the company’s manufacturing facilities.
“Those at our 2009 event will have the opportunity to participate in special sessions for maintenance and safety tips, factory tours, round-table discussions and new product ‘sneak peeks,'” Brady noted.
In 2010, the fifth annual North American Heartland Owners Rally will be held July 15-18, in Nashville, Tenn. For more information, go to www.heartlandowners.org.
The ongoing recession and tight credit will continue to affect RV sales in 2009, according to the latest research of economist Richard Curtin, director of Consumer Surveys at the University of Michigan.
In his Summer issue of Roadsigns, which is prepared for members of the Recreation Vehicle Industry Association (RVIA), Curtin said RV shipments are expected to decline to 136,500 units this year. While this estimate is well below his forecast of 186,600 issued last November, it is a slight improvement from his forecast that appeared in the Spring 2009 Issue of Roadsigns, when he estimated total shipments this year would retreat to 130,100 units
Curtin will expand upon his latest forecast as one of the featured speakers at RVIA’s Committee Week, which gets underway today in Washington, D.C.
“They (shipments) reached a lowpoint in the first quarter of 2009, and can be expected to begin posting small seasonally adjusted gains in the balance of 2009 and into 2010,” Curtin stated. First-quarter shipments totaled 30,400, off 63% from the first quarter of 2008.
“The gains will be focused on conventional travel trailers during the next year or so, although all types of RVs will improve,” he said.
Further, he stated, “The recession is expected to end by the close of 2009 due to the favorable impact of the stimulus package and the revival of more normal credit conditions. Unfortunately, the recovery is expected to be abnormally slow. The economic outlook still remains quite uncertain, which has clouded prospects for the RV industry as well.”
“The pace of the recovery in RV sales,” Curtin continued, “will be slowed by the shift in priorities among consumers away from spending and toward debt repayment and the building of savings and reserve funds, including their diminished retirement accounts. Although credit will not be as free-flowing as in the past, RV buyers are excellent credit risks and can be expected to return to the market.”
By segment, Curtin offered these shipments forecasts for 2009:
- Travel trailers, 82,600.
- Fifth-wheels, 29,500.
- Folding camping trailers, 10,900.
- Truck campers, 2,000.
- Class A motorhomes, 5,400.
- Class B motorhomes, 900.
- Class C motohomes, 5,200.
Uncertainty Clouds RV Forecast
Curtin concluded with the observation that his forecast bears some uncertainty. He said, “When the economy finally reaches the bottom of its cycle, the initial phase of the recovery is typically anticipated to be as rapid as the descent into recession. That’s a natural assumption since it mirrors the typical cyclical pattern of the past.
” The current recession, however, is hardly typical as it involved a virtual freeze of credit markets and the deepest and longest decline in production and income during the past half century. The full restoration of normal credit flows will be a painstakingly slow and uneven process.
“Moreover, the impact of the new financial regulations, which are as yet largely undeveloped, will continue to add uncertainty to financial markets and lenders. While RV shipments are forecast to be 136,500 in 2009, the range about this forecast is unusually large, plus or minus 15%, with a comparable range for all various types of RVs covered in this forecast.”
The University of Michigan also prepares a monthly report on Consumer Confidence, which took a big jump in May, according to the report.
May 22, 2009 by Bob Ashley · Comments Off
With struggling American automotive manufacturers agreeing to work toward a dramatic increase in fuel economy over the next seven years, the Recreation Vehicle Industry Association (RVIA) finds its hands tied in efforts to realistically influence the outcome of any national energ Wind Power, Wind Turbine Blades, Home Wind Turbines-75% Comm. y-related issues.
That, says RVIA President Richard Coon, is why RVIA won’t be taking a more aggressive stand against the national CAFE standards proposed this week by President Obama.
“The RVIA doesn’t have any leverage,” Coon told RVBusiness. “We are still opposed to CAFE increases. We are just as adamant.”
In a press release earlier this week, RVIA urged Congress and the Obama administration to take into consideration the need the RV industry has for heavier tow vehicles.
Although Chrysler LLC is in bankruptcy and General Motors Corp. faces a June 1 deadline to restructure, automakers apparently have accepted standards laid out by the California Air Resources Board (CARB) and endorsed on Tuesday by President Obama.
Under the plan endorsed by President Obama that still needs to go through Congress and the regulatory process, cars and light trucks together would need to average 35.5 miles per gallon (mpg) by 2016 with car standards rising from the current 27.5 mpg to 39 mpg and light trucks increasing to 30 mpg from 24 mpg.
That has many in the RV industry worried that automakers soon won’t be building trucks with enough horsepower to tow larger travel trailers and fifth-wheels.
Coon said that RVIA will continue to work with a coalition that includes the Recreation Vehicle Dealers Association (RVDA), American Recreation Coalition (ARC), National Automobile Dealers Association (NADA), Alliance of Automobile Manufacturers and the SUV Owners of America to limit fuel-mileage increases outlined by Obama.
California’s air board was preparing to set its own standard by limiting tailpipe emissions on vehicles sold in that state, and 16 other states were considering adopting CARB-like standards.
“Not having all the states setting their own standards is a plus,” Coon said. “But when you look at the auto manufacturers, they’ve got big problems at the moment and CAFE just adds to their barrel of misery.”
The 2016 date would move up by four years standards signed by President Bush in 2008 requiring auto manufacturers to meet a fleet average of 35 miles per gallon by 2020.
Pickup and medium-duty trucks used for towing RVs are scheduled to be the target of a separate set of standards to be established by the National Highway Transportation Safety Administration (NHTSA).
Drew Industries Inc. has reported a net loss of $36.7 million for the quarter ending March 31.
The results included a non-cash impairment charge of $29.4 million.
Excluding the impairment charge, the net loss for the 2009 first quarter was $7.3 million, compared to net income of $9.1 million in the first quarter of 2008. The White Plains, N.Y.-based supplier to the RV and manufactured housing industries attributes this first quarter 2009 loss to the severe recession and tight credit markets, which resulted in sharp declines in the two industries.
In the first quarter, the company also incurred $4.9 million of extra pre-tax expenses, which reduced after-tax results by $3 million. These extra expenses were due to the unprecedented conditions in the RV and manufactured housing industries, and included increased bad debts, obsolete inventory and tooling and costs related to plant consolidations and staff reductions.
Net sales in the first quarter declined 55% to $71 million, from net sales of $159 million in last year’s first quarter. This decline in net sales resulted primarily from a 61% drop in industrywide wholesale shipments of travel trailers and fifth-wheel RVs, and a 46% decrease in industrywide production of manufactured homes.
“RV and manufactured housing sales are particularly dependant on the availability of credit for dealers and consumers, and credit has remained difficult to obtain throughout the last eight months,” said Fred Zinn, Drew president and CEO. “When loans to dealers and consumers become more readily available, we expect that both the RV and manufactured housing industries will benefit substantially.”
In recent weeks, the RV industry has experienced some seasonal increase in demand, although the company cannot predict whether this increased demand will continue, as it is still very difficult for dealers and consumers to obtain financing. Historically, the RV and manufactured housing industries have been seasonal, with the first and fourth quarters normally the weakest, and second and third quarter results traditionally stronger.
During the first quarter of 2009, the company generated solid cash flow, increasing cash by $6 million, to more than $14 million, and reducing total debt by more than $2 million, to $6 million.
“This was accomplished by reducing inventory by $19 million during the quarter which more than offset the seasonal increase in accounts receivable,” said Zinn. “We expect our strong cash flow to continue over the next several quarters, as we further reduce inventory levels by $15 million to $20 million in addition to the $19 million we reduced in the first quarter.”
The company also continued to reduce expenses through facility consolidations, staff reductions, and synergies between its subsidiaries, Lippert Components and Kinro. These and earlier cost reduction measures benefitted first quarter 2009 results by $2 million compared to the same period in 2008, and are expected to benefit full year 2009 results by nearly $9 million. “Our continuing efforts have enabled us to significantly reduce our breakeven sales level and reduce inventories, while maintaining our traditional high level of customer service,” said Jason Lippert, president and CEO of Lippert Components and Kinro.
“Operating management has done an outstanding job in dealing with the unprecedented weakness in our markets,” said Zinn. “In order to bring our capacity in line with current demand, we have been forced to make significant staff cuts, and I know this has been very difficult for everyone involved.”
“On the bright side, we continue to provide jobs for about 2,000 dedicated employees. And because of our strong balance sheet and cash flow, we have the resources to aggressively pursue opportunities for further market share growth and new products, helping to ensure that our business can thrive and grow rapidly once industry conditions begin to improve.”
“We are extremely encouraged by our market share gains in several of our recently-introduced products, in particular, our suspension products, jack stabilizers and RV entry doors,” said Lippert. “The enhancements we have made to our unique entry door give us a great shot at gaining even more RV market share, and give us the opportunity to bring our entry door to other markets. We have several other exciting new products in development, and we will take every prudent step to ensure that we increase our opportunity for growth, while continuing to improve our production efficiencies.”
Drew’s RV Segment also manufactures specialty trailers for hauling boats, personal watercraft, snowmobiles and equipment.
More than 90%of the company’s RV Segment net sales are components for travel trailer and fifth-wheel RVs, with the balance comprised of components for motorhomes and specialty trailers. The RV Segment represented 74% of consolidated net sales in the 2009 first quarter.
Drew’s RV Segment reported net sales of $52 million in the first quarter, a decrease of 58% from net sales of $124 million reported in the comparable period in 2008. Excluding sales price changes and acquisitions, the “organic” decline in RV Segment sales was 65%, due to the sharp decline in industry shipments.
Many of the towable RVs produced by the industry over the last several months have included fewer of the features and options ordinarily provided by the company. Industry-wide wholesale shipments of motorhomes, components for which represent 3% of Drew’s RV segment sales, were down 78% in the first quarter of 2008.
In the first quarter Drew’s RV Segment reported an operating loss of $4.7 million, which included $2.9 million of extra expenses related to plant consolidations, staff reductions, increased bad debts and obsolete inventory and tooling. Excluding these extra expenses, the company’s RV Segment had an operating loss of $1.8 million, a decrease of $16.1 million from the segment operating profit of $14.3 million in the same period last year.
“This $16.1 million adjusted decline in RV Segment operating results was 20% of the ‘organic’ decline in net sales,” said Joe Giordano, Drew’s CFO and treasurer. “This was consistent with what we would typically expect, as increases in labor and material costs as a percent of sales were offset by fixed-cost reductions.”
“Through acquisitions, new product introductions and our position as an increasingly important supplier to leading RV manufacturers, we increased our product content for travel trailers and fifth-wheel RVs to $1,943 per unit for the last 12 months, compared to $1,760 per unit in the prior 12-month period,” said Lippert.
“We are very pleased with these market share gains, as well as the opportunities we see for our new, patent-pending Tow-N-Stow,” said Lippert. “Weather-proof and lockable, Tow-N-Stow converts in minutes from a versatile trailer, which can be towed by fuel-efficient cars rather than trucks or SUVs, to an attractive upright storage shed. We are introducing the Tow-N-Stow this week at the National Hardware Show in Las Vegas.”
Meanwhile, Drew reported that net sales in April were down approximately 45% year-over-year. This is an improvement over the 55% net sales decline in the 2009 first quarter, and April 2009 net sales were about 19% higher than March 2009 sales.
“While it’s too soon to know whether this sequential improvement in sales will continue, it is encouraging that our reduced number of facilities are producing more and our employees are working more consistent hours,” said Lippert. “RV dealers have been consistently reducing their inventories over the last nine months. Therefore, once credit becomes more readily available to dealers and consumers, and retail demand improves, we expect that dealers will have to replenish their inventories, which should significantly boost wholesale production.”
RV shipments to retailers were reported at 10,300 units in the February survey of manufacturers compiled by the Recreation Vehicle Industry Association (RVIA), an increase of nearly 40% over last month but 63% less than this same month, one year ago.
Shipments of towables totaled 9,600 units, while motorized shipments totaled 700 units. Seasonally adjusted, February’s results represent an annualized total of more than 120,000 units.
While towable RVs improved in February, moving up 45% compared to shipments of these same products one month earlier, motorhome totals were the same. Conventional travel trailers represented 60.3% of this month’s total shipments as compared to 54.1% for all of last year.
In particular, February 2009 shipments, compared with February 2008 shipments were as follows:
- Travel trailer shipments totaled 6,200 units, down 58.1%.
- Fifth-wheel shipments totaled 2,400 units, down 64.7%.
- Folding camping trailer shipments totaled 900 units, down 55.0%.
- Truck camp shipments totaled 100 units, down 80%.
- Class A shipments totaled 300, down 83.3%.
- Class C shipments totaled 400 units, down 73.3%.
- Class B shipments were down 64.6%, with less than 100 units shipped.