Editor’s Note: The following is a press release from Elkhart, Ind.-based RV builder Forest River Inc. responding to recent reports on two industry websites regarding the company’s ownership of property in Texas that was leased to two entities, including dealer Fun Town RV.
Forest River Inc. announced today (Feb. 18) that the three land parcels the company had purchased Oct. 30, 2012, in Johnson County, Texas, are now sold.
According to the release, there is a signed contract with earnest money securely in place for the two parcels leased to Fun Town RV and a verbal commitment to exercise the option to purchase from the portable building manufacturer on the third parcel.
“These are the same two lessees that have continuously occupied and improved the parcels for some time,” the statement read. “Until the three parcels were sold, these two lessees had been leasing the properties, with an option to buy, from Forest River at the same lease amounts that existed under the prior bank ownership arrangements. Lease amounts will continue to be in effect until such time as the property closings are final.”
The property recently was the subject of reports on both the RV Pro and RV Daily Report websites, citing Texas RV Association Executive Director Clark McEwen. Forest River claimed that “contrary to McEwen’s speculation, the land purchase was not a direct challenge to the (Texas) statutes.”
The release further stated that Forest River “wasn’t even notified there was a complaint until last week and, despite our request, we have yet to receive a copy of the complaint reportedly filed by the Texas RV Association with the Texas Department of Motor Vehicles. A courtesy call would have been nice and probably sped up the resolution of any dispute.”
In the reports, McEwen also said that “Forest River has for years been the most outspoken critic of the Transportation Code, the DMV and the Texas RV Association.”
With over 8500 employees operating out of over 60 different plants, Forest River said that “to our knowledge, we have never publicly criticized the Transportation Code, the DMV, or the Texas RV Association. On the contrary, when a potentially harmful tax issue surfaced and the Texas RV Association requested funding to help correct it, Forest River was one of the first to step up and write a check for $10,000 to help correct it. Further, when the Texas RV Association and McEwen himself wanted to bolster their tech training program by adding a fifth-wheel toy hauler for mobile training, Forest River stepped up again and sold the Texas RV Association a fifth-wheel toy hauler for $1 because we believed in the effort and wanted to fully support it.”
Forest River added, “Our support to the industry and our dealers in Texas has been, and will continue to be, unwavering. We apologize for any consternation this land purchase might have caused. We appreciate our dealers’ business and friendships, and look forward to experiencing an outstanding 2013 with everyone.”
Forest River Inc. announced the appointment of Gary Duncan as general manager of the company’s park model division, effective Feb. 1.
According to a press release, former General Manager Jim Foltz will continue with the division, assuming other responsibilities.
Duncan joined Forest River’s park model sales team in November of 2011 and has been instrumental in the redesign of the entire product line, as well as executing new initiatives for product enhancements and the marketing of park models.
Duncan has a bachelor’s in engineering from the University of Michigan, with 15 years of varied experiences in the RV industry. Prior to the RV Industry, he served in a variety of sales and engineering capacities with Tier 1 automotive suppliers.
Duncan can be reached at (574) 264-2513 (office), or via e-mail at email@example.com .
Just days after Forest River Inc. inked a deal to buy the sprawling Utilimaster Corp. campus on Wakarusa’s east side, Forest River subsidiary Prime Time Manufacturing is already building RVs at the site.
“We’re already into production,” said Jeff Rank, president of Prime Time. “We started moving stuff at the end of the year in preparation.”
The Elkhart Truth reported that the sale, announced last week by Utilimaster, brought some certainty back to the town. When Utilimaster announced 11 months ago that they were moving to Bristol, “that came out of the blue,” said Jeff Troxel, Wakarusa town manager who was a member of the town council at that point.
With the Forest River purchase now finished, “I’m excited about it,” said Troxel. He knew Prime Time was outgrowing its space just down the road from the Utilimaster campus. “I didn’t want to lose Prime Time,” he said.
“Hopefully Forest River uses the facility to its utmost potential,” Troxel said.
Pete Liegl, president and CEO of Elkhart-based Forest River, said, “We wanted to stay in that community with Prime Time because Prime Time has done so well and Jeff Rank has done an excellent job down there.”
In an interview with RVBUSINESS.com, Rank reported much of the production that Prime Time has moved into the former Utilimaster plant since the holidays, including Crusader and Sanibel towable production, was located until the end of the year at the former Hart Housing Group facilities in Wakarusa, recently sold by Forest River to Maryville, Tenn.-based Clayton Homes, a sister division with Forest River of Berkshire Hathaway Inc. according to Rank.
Rank says the Hart Housing sale was structured such that Prime Time’s operations could stay in that Hart Housing facility until the end of the year. So, Prime Time moved over the holidays — the end result being that Prime Time today is located in the original plant it has occupied on the south side of Wakarusa — the former Travel Supreme plant — in addition to part of the Utilimaster complex that Spartan’s Utilimaster commercial truck unit is vacating, a total of 325,000 square feet of production space for 400-employee Prime Time.
Rank says things are going well with the move, noting, “Oh, it’s fantastic. I mean, quite frankly, Prime Time loves being in Wakarusa. I mean, the town’s been good to us. So we were thankful as we were moving out of Clayton that Forest River was able to do this because we wanted to stay in Wakarusa, and obviously it’s good for the community that the jobs we have at Prime Time are staying in Wakarusa. On top of that, there’s a lot of buildings and a lot of land over there that Forest River has bought that could play into future expansions and give us additional opportunities to grow and extend our operations.
“You know, we’re going to continue growing. Prime Time grew 40-some percent last year in market share and we’re off to a great start again this year, and we’ve got several products that are actually being built in that same plant. As those products mature and get more volume, we’re going to need additional facilities for them as well. So, it would only be my hope that we could continue to grow there (in the Wakarusa area), but that’s a long time away. This deal just recently went down, and I can’t actually tell you that we’ve (Forest River) sat down as a group and talked about it.”
To read the entire Elkhart Truth article click here.
Both Utilimaster Corp. and the town it’s leaving got a boost this week with the sale of the company’s former buildings in Wakarusa.
As reported by the South Bend Tribune, Spartan Motors Inc., Utilimaster’s parent company, sold 13 of its Wakarusa buildings to Forest River, according to FM Stone Commercial, which negotiated the sale. The buildings sit on 91 acres along Indiana 19 in Wakarusa, and Utilimaster already is using two of the buildings.
Utilimaster will temporarily use three buildings in Wakarusa for its truck body operation, according to Spartan Motors.
Officials from Forest River, a Berkshire Hathaway Inc. company, did not return a call to The Tribune.
On Wednesday, Jeff Troxel, town manager for Wakarusa, said the announcement was good news for the community. He said he believes Forest River already has moved its Prime Time RV business into the Wakarusa campus.
Troxel is hopeful Forest River will make full use of the former Utilimaster campus.
And if that happens, more workers will be coming into Wakarusa to help replace the 600 to 800 people who normally came to the Utilimaster facilities.
To read the entire article click here.
While it may not be time yet to celebrate the industry’s total resurgence from the Great Recession, this may well be a good moment to pause and appreciate the steady and accelerating (re)growth of the North American recreational vehicle arena after finishing 2012 with a flourish in terms of wholesale and retail sales.
Indeed, we’ve come a long way, baby, since the industry was perched on the leading edge of a global downturn and Elkhart, Indiana’s RV-building zone — with 20-plus-percent unemployment — became America’s recessionary poster child for the national press.
Now the old “first-in, first-out” theory appears to have again come into play with the Recreation Vehicle Industry Association (RVIA) reporting shipments bouncing from a recessionary low point of 165,700 units in 2009 to about 290,000 in 2012.
And while 2012’s output still falls well short of the modern high of 390,500 in 2006, the RV Business staff is recognizing two companies that have played pivotal roles in spearheading the industry’s comeback with stellar performances — Thor Industries Inc. and Forest River Inc., the industry’s unrivaled No. 1 and No. 2 market share leaders, respectively — as RVB’s Newsmakers of the Year for 2012.
Publicly held Thor, an 8,800-employee firm holding 34.8% of U.S. market share in terms of units retailed through October, reported a “blockbuster” first quarter of fiscal 2013 (ending Oct. 31) with sales up 30% to $875.6 million and net income up 38% to $31 million.
In its fiscal year ended July 31, Thor’s sales of RV’s, small and midsize buses and ambulances rose 12% to an all-time high of $3.1 billion on the strength of its varied subsidiaries: Keystone RV Co., Goshen, Ind., Thor Motor Coach Inc., Elkhart, Ind., Dutchmen Mfg. Inc., Goshen, Ind., CrossRoads RV/Redwood RV, Topeka and Syracuse, Ind., Heartland Recreational Vehicles LLC, Elkhart, Airstream Inc., Jackson Center, Ohio, and Thor’s Commercial Vehicle Group in Elkhart.
For Forest River — an 8,500-employee, Elkhart-based division of Berkshire Hathaway Inc. known for its aggressive approach to product development and dealer networking in both towable and motorized RVs as well as cargo trailers, shuttle buses, boats and other categories — the situation right now is similarly upbeat.
Forest River President and CEO Pete Liegl said his company has been running an impressive 27% ahead of 2011 through the first 10 months of 2012 enroute to posting its own all-time record revenues.
“This has been a super good year,” Liegl told RVBUSINESS.COM. “We had good sales. Profits are never as good as they should be, but it’s acceptable. As for the rest of the year, November numbers are good and December’s going to be good, too, in relation to last December. So, when all is said and done, we’ll be bumping 3 billion (dollars in total revenues). We’re probably not going to cross the finish line (exceeding 3 billion dollars in sales for 2012), but we’ll be down there in the red zone.”
At the same time, Forest River, which accounted for 31.8% of all U.S.-retailed RVs through October (according to Statistical Surveys Inc.) and has been growing faster than Thor in certain categories, is dramatically expanding its production capacity for 2013 to the extent that it is currently adding about a million square feet of capacity.
This, said Liegl, should benefit most all of the divisions operated by the company’s senior product-related management team, including Doug Gaeddert, Jeff Babcock, Don Gunden and Mike Terlep in RVs as well as David Wright in buses, Rex McKay in cargo trailers and commercial trucks and Tom McCutty in housing and boats.
Meanwhile, given the general landscape of the industry right now and some of the investor calls he’s been fielding lately, Thor Chairman and CEO Peter Orthwein thinks these kinds of record-breaking numbers are not just a short-term blip on the radar, but part of a more significant industrywide upswing.
“You know, we’re feeling our business is getting much stronger now,” Orthwein told RVB. “In addition to those increased revenues, our backlogs were very strong at the end of the first quarter and certainly in the motorhome segment our revenues nearly doubled. So, we’re feeling good.
“My feeling is that we’re at a turning point in the market right now,” he added, “especially on the motorized side, where the consumer has paid down his loan on his old motorhome and now has equity in that coach and can trade it in and buy a new one. And, by using that equity as a down payment and with today’s low interest rates, he can drive away with a new motorhome without appreciably increasing his monthly payment. So, we’re really at a turning point. Historically, the average consumer traded in his motorhome every four years.”
Thor President and COO Bob Martin said Thor’s fiscal health speaks well for the general well being of the rest of the industry and of the North American consumer’s continued fascination with this kind of camping lifestyle. Even in the global downturn, he pointed out, campgrounds were busy.
“We knew that people, even though they were holding off buying decisions, were going to come back,” said Martin. “As the wholesale and retail credit markets improved, the industry has slowly come back to health. We see a bright future for the industry. Coming out of a strong Open House and a very good Louisville, we see good things to come for next year.”
Other 2012 Newsmaker contenders included Marcus Lemonis, chairman of Camping World Inc. and its sister division, Good Sam Enterprises LLC; former Thor executives Ron Fenech, Bill Fenech and Don Clark and their new enterprise Grand Design RV Co.; Kampgrounds of America Inc. President & CEO Jim Rogers; Darryl Searer, the semi-retired chairman of Ultra-Fab Products Inc., and current president of the RV/MH Heritage Foundation’s Hall of Fame; Elkhart’s Annual Open House Week and Winnebago Industries Inc., Forest City, Iowa. See more details in the January/February issue of RVBusiness.
Elkhart, Ind.-based real estate firm FM Stone Commercial, which represented Forest River Inc. in its acquisition of Spartan Motors Inc.’s Utilimaster Corp. facility in Wakarusa, Ind., reports that 13 of the 14 industrial buildings on State Road 19 were sold in the transaction.
According to a press release, the buildings purchased by Forest River encompass 510,350 square feet in the complex currently being vacated by Utilimaster. Spartan is relocating its Utilimaster operations to Bristol, located 20 miles northeast of Wakarusa.
The buildings were on the market for just over nine months. Buildings range in size from 10,590 square feet to 90,270 square feet and were part of one of Wakarusa’s largest manufacturing facilities.
The remaining building on the Wakarusa campus is still available for sale through FM Stone Commercial. The three-story, 30,150-square-foot office building on 4.18 acres features an elevator, a climate-controlled computer room, covered loading dock, six rest rooms, heavy power, and geo-thermal heating and air conditioning.
The move to Bristol will consolidate Utilimaster’s operations into one 425,000-square-foot facility from its current campus of multiple buildings. Spartan Motors, parent to Spartan Chassis Inc., said the new facility will streamline operations and is expected to save up to $4 million annually.
Spartan Motors Inc. announced the sale of the majority of its Utilimaster Corp. manufacturing facility in Wakarusa, Ind., to Forest River Inc.
According to a news release, the transaction was pursuant to Spartan’s announcement on Feb. 14, 2012, that it will relocate the company’s Utilimaster operations to Bristol, Ind., from Wakarusa.
“The sale of the Wakarusa facility represents an important step in the transition of Utilimaster’s operations to Bristol,” said John Sztykiel, president and CEO of Charlotte, Mich.-based Spartan Motors, parent to Spartan Chassis Inc. “As we finalize the move and ramp up production, we expect the new, modern plant to support Utilimaster’s long-term growth and enable us to achieve our potential in delivery and service vehicles.”
The move to Bristol, located 20 miles east of Wakarusa, will consolidate Utilimaster’s operations into one facility from its current campus of 16 buildings. Spartan said that moving into a single plant, combined with lean manufacturing practices, will help enable Utilimaster improve product quality and manufacturing efficiency by reducing operating costs and eliminating non-value-added steps.
Forest River, based in Elkhart, is a subsidiary of Berkshire Hathaway Inc. and is one of the largest manufacturers of RVs. With multiple manufacturing facilities throughout the Midwest and West Coast, Forest River also produces park model trailers, destination trailers, cargo trailers, commercial vehicles, buses, pontoons, restroom trailers and mobile offices.
Elkhart, Ind.-based Forest River Inc. has completed the sale of 14-year-old Hart Housing Group, a modular home builder in Wakarusa, Ind., to Maryville, Tenn.-based Clayton Homes, Forest River President and CEO Pete Liegl confirms.
The transaction between Clayton and Forest River, both units of Berkshire Hathaway Inc., was quietly finalized nearly two months ago but never reported in the press.
The sale of Hart, originally purchased by Forest River about eight years ago from RV industry entrepreneur Dave Hoefer, includes Hart Housing’s three-building complex on the south side of Wakarusa where 190 to 210 workers had typically been employed.
Although Clayton Homes spokesmen were unavailable for comment, RVBUSINESS.com has learned that the Wakarusa plant is now being managed by personnel out of Clayton’s Middlebury operation, one of the Tennessee company’s 35 plants.
“The sale entails them taking over Hart Housing and everything involved with Hart Housing,” Liegl told RVBUSINESS.com. “And, specifically, we got out of it because that’s (manufactured housing) not our core business. It is Clayton’s core business, and they’ll do better with it than what we have.
“We never did what we thought we could do or would do (in the housing sector), and we just decided that Clayton could do a much better job and it would fit in with their marketing and manufacturing locations,” said Liegl, who predicts that Forest River will post revenues this year of close to $3 billion. “So, obviously, Clayton is a sister company and it’s better for Berkshire Hathaway if they handle it.”
That said, Liegl emphasized that this was not a distress sale.
“In the last six or eight months, we were doing quite well with it, particularly for the units that we were building for up in North Dakota (where an oil boom is underway),” added Liegl. “But, again, how long is that going to last? So, I can’t look at one little item here and say this is good enough to keep it. I mean, we have not in the past accomplished what we wanted to accomplish in housing. And that’s Clayton’s forte. And, in fact, they’re hiring as we probably wouldn’t be right now.”
First acquired by Warren Buffett and Berkshire Hathaway in 2003, Clayton’s 12,000 employees build, sell, finance, lease and insure manufactured and modular homes — as well as relocatable commercial and educational buildings — under the Schult, Karsten, Crest, Marlette, Golden West, SEhomes, Norris, Giles, Cavalier, Bucaneer and Clayton Building Solutions brand.
Shasta RV, a division of Elkhart, Ind.-based Forest River Inc., announced the launch of its all-new Phoenix mid-profile and “super-mid profile” fifth-wheels during the recently completed Elkhart County RV Open House. According to a press release, Shasta is securing a 55,000 square-foot production facility to meet demand for the product and anticipates the hiring of 75 new employees by year’s end.
“The Phoenix is a uniquely constructed, value-added-fifth wheel,” said Product Manager Chadd Johnson, previously of CrossRoads RV who is overseeing sales in Canada for the Phoenix brand. “We have instilled a creative thinking process in our team, and have invested the extra effort to be inventive and attentive to details.”
Johnson noted that Daric Fail will handle sales in the southern U.S. while Kris Lash covers the northwestern states. The Phoenix will also be on display during this week’s the Recreation Vehicle Dealer Association’s (RVDA) Convention/Expo in Las Vegas.
“The response to the product at the Open House was unbelievable,” reported Mark Lucas, president of Shasta RV. “We had dealers standing three and four deep just to get inside. Dealers made positive comments and complimented the overall unique look and feel, as well as the commitment to our value added design and construction method.”
The Phoenix utilizes a mechanically-fastened, 16-inch on center, six-sided aluminum cage for its construction. Tongue-and-groove plywood covers the floor structure, while a rolled-edge roof caps off the modern colored, hung fiberglass exterior. “This product will compete directly with the current mid-profile products on the market, but we’ve integrated features and eye appeal normally found at much higher price points,” said Lucas.
Standard features include wide-body construction, unique wall treatments, leather-style furniture and a “designer-inspired” bathroom. Phoenix fifth-wheels will range from 27- to 34-feet in length with MSRP’s starting around $30,000.
“Most people inherently want to feel they have something unique and special. We deliver that wish, and then some, without asking them to pay $60,000 to do so,” said Johnson. “Most products in the mid-profile segment all look the same and are all built the same. We instead, invest time and expense in the best possible construction, and pair that with a contemporary interior and class-leading exterior design. This Phoenix fifth-wheel is sure to have a broad appeal.”
For more information, available territories or details on the Phoenix, call (574) 825-7178.
Driving down the Indiana Toll Road and passing the RV/MH Hall of Fame last week a person would have had to wonder just what’s going on.
As reported by the South Bend Tribune, hundreds of recreational vehicles were on display in the field adjacent to the hall, parking lots were busy, hotel rooms were full and lots of people were roaming the grounds.
Thousands of RV dealers from all 50 states, Canada and even China were in town checking out the 2013 model offerings of most major RV makers in Elkhart County.
Thor industries Inc.’s Open House was held at the Hall of Fame. But most of the other 11 shows were just a short distance away on County Road 6.
For dealers such as Bruno Tombari Jr. from Bella Vista RV Centre in Hawkestone, Ontario, it was quite an opportunity.
“We set our tone for our entire season pretty much at this show,” said Tombari, as he toured the grounds at the hall with his father, Bruno Sr., checking out all the latest offerings from Thor’s brands including Keystone, CrossRoads, Heartland, Dutchmen, Breckenridge and Thor Motor Homes.
“Thor is one of the largest lines we carry,” Tombari Jr. said
The South Bend Tribune reported that Thor’s President and COO Bob Martin said at least 3,000 dealers were at the Thor Open House alone from Tuesday through Thursday. But many dealers such as Tombari got in their cars and visited the other shows.
“We go down to Forest River and also to Fleetwood and Newmar as we represent those lines also,” Tombari said.
What Tombari likes most of all is how much he can get accomplished with so many shows going on just a few miles from each other.
“It allows you in a few days to do something that might take you four to five visits throughout a year,” he said. “Now you can do it in a three-day segment.”
In the business world, this is really a win, win, win with the dealers, the manufacturers and the town of Elkhart all reaping financial rewards.
It all started five years ago, with Forest River Inc. holding an open house for dealers, said Mark Bowersox, executive director of the Recreation Vehicle Indiana Council (RVIC). Thor got on board three years ago.
“With the two big players in the industry, all of the other manufacturers jumped on board,” Bowersox said.
The end result is a show that has doubled its numbers the past few years, says Diana Lawson, executive director of the Elkhart County Convention & Visitors Bureau.
Bowersox said one of the keys is the casual atmosphere of the shows.