Forest River’ Inc.’s cargo division plant in Independence, Ore., was shut down on Friday (Jan. 4) after a mass shooting threat was discovered, according to a report in the Itemizer-Observer.
Company officials found a handwritten letter in an office at 7 a.m. that “basically stated `People are going to die today, I’ll shoot you all’ and other things,” said Independence Police Chief Vern Wells.
“There are no good suspects right now,” Wells said. “But we’re processing the note for evidence … the investigation continues and we have a couple of leads.”
Plant managers sent Forest River employees home after officers arrived to search the building. No weapons or other evidence was found.
“There are so many people there, we decided that it was best to clear it out to eliminate the threat,” Wells said. “Some of the employees thought (the situation) was silly, but they felt it was an appropriate action for the company to take, just in case.”
Independence Police has received reports of bogus threats of violence at area schools during recent years, but nothing that warranted an evacuation, Wells said.
“I can’t remember when we’ve had a written threat at a business, but it’s unusual and that’s why we took it seriously,” he said. “With the recent (mass shootings) in the United States, you have to use caution.”
Forest River was scheduled to reopen today.
With total attendance of ”just under 3,000” dealership personnel, Elkhart-based Forest River Inc. is expecting to garner $500 million in wholesale sales from Elkhart County’s 4th Annual RV Open House Week, Sept. 19-23 in and around the RV-building center of Elkhart, Ind.
“Tuesday and Wednesday were exactly what we thought they would be,” said Jeff Babcock, general manager of Forest River’s motorized operations, including Lexington, Sunseeker, Georgetown, Dynamax, Berkshire and Charleston motorhome lines. ”Sales were good. We were busy throughout all our displays.”
Forest River spearheaded Open House Week four years ago with a major dealer gathering at its Elkhart headquarters. Manufacturer participation has grown each year, and a couple of dozen manufacturers followed Forest River’s lead this year by holding dealer showcases of their own at various locations around the northern Indiana city.
Forest River showed some 620 towable and motorized units on 35 acres on the grounds of its newly acquired Dynamax subsidiary on the northeast side of Elkhart, where dealers were treated to free catered meals and refreshments.
”We had 2,000 dealers on the property at any one time,” Babcock said. ”You don’t realize how many people are out there looking at units until they come in for lunch and dinner.”
While Forest River expects to generate $500 million in orders through the end of the year from the open house, Babcock said sales weren’t as brisk as they might have been because of the volatility of the stock market and the political squabbling over spending and tax revenue in Washington, D.C.
”Dealers still have inventory on their lots and they are still a little apprehensive,” he said adding that the sales total includes motorized and towable RVs, cargo trailers, manufactured homes, pontoon boats and other Forest River products.
Mike Thompson’s RV Super Stores Tuesday (Nov. 3) opened a fourth location in Cathedral City, Calif., about 130 miles east of its flagship dealership in Santa Fe Springs southeast of Los Angeles.
“It’s kind of exciting that for the first time in a year and a half, we are hiring people instead of laying them off,” said Mark Rosenbaum, Mike Thompson’s sales director.
Mike Thompson’s, which also operates stores in Colton and Fountain Valley, Calif., has hired about 25 people to staff the new dealership featuring an outdoor display area on two acres.
“We’ve moved into the Palm Desert area to capture some of the Snow Bird market — the people from the East Coast, Midwest and Northwest who come to the sunny areas during winter months,” Rosenbaum said. “There was inventory sitting on the ground as of Tuesday. Five customers showed up while we were setting up.”
Rosenbaum said Mike Thompson’s will market heavily to RV owners occupying Palm Desert-area RV campgrounds and resorts with which the dealership already has made contact.
The dealership, Rosenbaum said, will establish temporary displays at several local campgrounds. “The local campgrounds have been absolutely the best you could possibly ask for,” Rosenbaum said. “They’re looking forward to a dealer being involved in the market out here.
”We will be visiting the campgrounds with units and we will have get-togethers for the campers. Word-of-mounth is the most important marketing we can do.”
Having recently added Tiffin motorhomes to its inventory, Mike Thompson’s also retails Itasca, Fleetwood Bounder and Bounder Classic, Forest River Georgetown, Damon, CT Coachworks and Four Winds motorhomes and Keystone towable RVs.
The new store’s split will be about 50/50 between motorhomes and towables, although Rosenbaum said that ”trailers will probably grow more.”
Rosenbaum credited Mike Thompson’s 97% customer satisfaction rating — measured by an independent research company — as generating the business to expand during economically challenging times.
”Our customer service index is pretty strong so we have some very strong customer loyalty,” he said.
Publisher’s Note: RVBUSINESS.com touched bases recently on a variety of topics with Forest River Inc. founder and CEO Peter J. “Pete” Liegl. Here’s a verbatim transcript of that on-the-record conversation, which took place in the aftermath of the company’s successful “Pick Your Partners” dealer meeting that drew some 2,000 people from 700 U.S. and Canadian dealerships in late September to the Berkshire Hathaway Inc. subsidiary’s home complex on the west side of Elkhart, Ind. Parts of this interview appear in the upcoming issue of RV Business, the magazine.
RVBUSINESS.com: Pete, your dealer meeting this year was impressive to say the least, as most in this industry are well aware.
Liegl: It was considerably more than last year, obviously. But we’ve got Coachmen in there and a couple of other things we didn’t have last year.
RVBUSINESS.com: What signal or message are you sending these dealers?
Liegl: It’s not different than any other year. We are trying to give the best product at the best price ratio. Obviously, there’s only a couple of financially strong manufacturers in the RV business, and us being one. Dealers have gotten burned severely with a couple of other manufacturers who filed bankruptcy or went out of business and I think they realize that. The opportunity is phenomenal right now for us. We are going to expand the motorized area drastically. We’ve done OK in the towables and we’ve been into motorized quite a few years now, and we’ve got a pretty good handle on the products that we make in motorized and we just need to make more.
RVBUSINESS.com: Those are ambitious goals, considering that RVIA forecaster Richard Curtin predicts that motorized in 2010 is only going to occupy 7.8% of the market. Why would you expect growth in motorhomes?
Liegl: For several reasons. When you look at two other manufacturers that went bankrupt and might be coming back out, there’s a hell of an opportunity. We are completely convinced that the RV business is here to stay. It might be a little different than we’ve known it in the past. In total there is something like 21 manufacturers who used to manufacture some form of RV who are not with us here in the last 12 months.
But things are good. Things are not bad out there. I think it’s going to continually improve. Obviously, we all know the recession is over. It was over at the end of June. The recovery is going to take a little longer, but dealers are selling. Dealers are getting flooring. Customers are getting financing. The RV industry’s not bad right now.
RVBUSINESS.com: The RV industry generally leads in to – and out of –downturns. At least that’s how the old saying goes. Did it appear to hold true this time around?
Liegl: I believe it is holding true. We are doing more in sales and bottom line in the last three months than we did during a comparable period last year. And last year wasn’t a bad year. That’s also a little misleading because we have Coachmen (Forest River last year purchased the RV segment of Coachmen Industries Inc.) now with us. So, obviously we are not comparing true apples to apples. But even if we did compare apples to apples, which I do, we are doing better than we did last year during the same time period. You could just walk that (Forest River’s dealer) show and not hear anybody and look at them and know that the enthusiasm is running high.
RVBUSINESS.com: So, back to your earlier comment, you agree with (Federal Reserve Chairman Ben) Bernanke that the recession is over?
Liegl: Yeah. I think he predicted that sometime back. We still have high unemployment here, but it is improving. Interest rates are low. Gas isn’t expensive. Things are good.
RVBUSINESS.com: Flooring is still a challenge.
Liegl: Yes, in some cases it is. But again, dealers are required to do what they should have done in the last five years. We as an industry, we as a country, got sloppy. We gave people financing that shouldn’t have had it. We were lax on collecting the curtailments, paying the interest. Well, 20 years ago, we didn’t have that problem. Every dealer knew you were supposed to pay your curtailments and your interest. With this sub-prime attitude, giving financing to people who shouldn’t have it, primarily in housing, is a problem.
The big problem that we’ve experienced – and are now getting over – is that you’ve got to pay your interest to a financing institution. You’ve got to pay your curtailments, and they (a lot of dealers) weren’t used to that. They (finance companies) are holding their feet to their fire, and if they (dealers) don’t (pay curtailments), they aren’t going to get any more (credit). Now, people have accepted and understand that, and they’re more current with that situation than they were six months ago.
RVBUSINESS.com: Looking back at your dealer meeting, is it possible that you brought more dealers to Elkhart for your two-day get together than you’ll see at early December’s Louisville Show.
Liegl: I guess so. I don’ know what they (RVIA) are forecasting. But we were blessed with the number of dealers that did show up. I was very favorably impressed. And the attitudes were phenomenal.
We’ve got a lot (of dealers) who still didn’t come for various reasons that we expect to see in Louisville, and we are going to maintain our presence there. And our display this year will be as big, if not bigger than last year. I think we are going to see a lot of dealers down there, too. It might not be as many, but the Louisville Show comes and goes very quickly, and you don’t get to see as many dealers as you want and you don’t get to spend the time with them that you want. There might be fewer people coming to Louisville this year, I don’t really know. But I personally think there is going to be a product shortage next year. Some people think I’m crazy if you publish that. But I don’t care. I don’t think there’s going to be a product shortage, I know there is going to be a product shortage.
RVBUSINESS.com: Is this prediction based on growing demand in the market or on the industry’s inability to keep up after a tough year?
Liegl: Primarily on the manufacturers’ ability to beef up and give the market what it needs. It’s my understanding — and I had a list not too long ago — that 21 manufacturers have gone out of business. Obviously, even if the market shrinks, which it has and is going to be smaller next year than it was a few years back, there are not as many people (companies) to build the product. So, we plan on getting our share.
RVBUSINESS.com: What kind of pace are you on dollar-wise in 2009?
Liegl: We are going to do probably in the area of $1.8 billion.
RVBUSINESS.com: How many employees are you now?
Liegl: I think 6,200, nationwide.
RVBUSINESS.com: I know it’s a simplistic view, but a lot of people see the towable side of the industry turning into a what might best be described as a two-horse race between Forest River and Thor over the next few years. Your thoughts on that audacious statement?
Liegl: We are the financially strongest one, obviously. And we will be No. 1. There isn’t going to be any horse race. You just have to look at the recent stats. Our numbers are increasing where our other competitor’s out there are decreasing. We are only a few percentage points different right now when you put together Coachmen, Forest River and Palomino. Last month, I think we had 45% of the camping trailer business, retail. The July numbers are out and we aren’t doing as much as I want, but it’s acceptable.
Just as consumers begin to plan their summer getaways, the media has turned its attention to RVing as both an affordable and surprisingly “green” family vacation option, according to a release fro the Recreation Vehicle Industry Association (RVIA).
Environmentalist and full-time RVer Brian Brawdy was the subject of “On the Road, Off the Grid,” an April 15 story in the Chicago Sun-Times that focused on Brawdy’s commitment to adventure and environmentally friendly RVing. Echoing the sentiments of thousands of Americans who love RVing, Brawdy told the Sun-Times reporter, “Some of the greatest moments in science, the classics — they come when man is alone in nature. And there’s something about waking up in a different place every morning … it’s something I just can’t shake. It’s addictive.”
The Chicago Tribune also reported positively on RVing this month with “Resort Campgrounds Grabbing Bigger Share of Vacation Dollars,” highlighting the continued popularity of resort campgrounds among family vacationers looking to “save a buck without sacrificing comfort and fun.” The article noted many of the family-friendly amenities offered by campgrounds and reported that while hotel reservations are currently down significantly, resort campgrounds are expecting a spike in reservations this year.
In a segment titled “Go RVing and Go Green” on the popular Fox and Friends morning show April 18, RVIA President Richard Coon touted the RV industry’s innovations in creating fuel efficient, environmentally friendly RVs.
The Fox and Friends segment, secured through the efforts of RVIA’s public relations team, featured Forest River’s R-Pod ultra-light travel trailer and Damon’s Avanti Class A motorhome as examples of the industry’s latest innovations. As the camera panned the units’ features, Coon discussed the affordable amenities offered by both models, saying about the towable, “This unit is smaller, lighter, but it’s compact -and has everything in it.” He pointed out that ultra-light travel trailers like this are small enough to be hauled by the new crossover SUVs or even a minivan. About the motorhome Coon said, “It’s one of the new, high efficiency, eco-friendly diesels. I have a Suburban that I drive that gets somewhere between 14, 15, 16 miles per gallon – and this gets the same.”
The Miami Herald’s Lisa Sidmunsun highlighted RVing as one out-of-the-ordinary vacation option for Baby Boomers, saying, “For all those “easy riders” who long to roam – but want a little comfort when they do – renting a recreational vehicle (or RV) is a great way to go. Not only are they economical – RV vacations average 27% to 61% less than other types of getaways, gas included – they tend to be less stressful because you don’t have to stick to a rigid schedule, or worry about things like packing and unpacking, or rushing to catch a flight.”
RVIA Vice President and Chief Marketing Officer Gary LaBella said, “RVIA’s public relations team is working hard to ensure that RVing is touted by the media this spring as the family-friendly, affordable, and green-friendly vacation our industry knows it to be. Especially in the current economic environment, RVing has never been a better deal for families looking for adventure.”
RVIA’s PR team will broaden the impact of positive news stories and video segments by linking to the stories from Twitter and Facebook. “Green” stories also appear in www.GoRVing.com’s“Going Green” section and all stories are available in the Newsroom at www.rvia.org.
Fleetwood Enterprises Inc., the iconic Riverside, Calif.-based maker of recreational vehicles and manufactured housing that has ferried road-trippers and housed owners for 59 years, is continuing day-to-day operations after filing for Chapter 11 bankruptcy Tuesday (March 10).
As reported by the Press Enterprise, Riverside, part of its business will be shuttering its travel trailer division, affecting 667 employees nationwide including 12 at the company’s Rialto, Calif., service center. Other closures include plants in Pendleton and La Grande, Ore., impacting 415 workers, along with a facility in Edgerton, Ohio, that employed 175 employees people.
Fleetwood said that all current orders would be complete at the plants before they were closed down.
In addition, the company laid off another 65 Inland workers in corporate positions Monday. More than 600 workers remain in Riverside.
The company, which will now be concentrating on its motorhome and manufactured housing markets, still has 15 factories and 3,000 employees nationwide. That’s a far cry from its heyday in 1998 when 21,000 people in 62 factories built RVs, trailers and homes.
A Fortune 500 company for 28 years, the company boosted Riverside’s business image and made the Inland region a destination for other RV makers.
Now, bruised and battered by failed attempts to expand, ballooning debt and an economy in tatters, Fleetwood’s stock traded for a penny per share on Tuesday. The company hasn’t made an annual profit since April 2000.
Since then there has been a flurry of management changes, while the company winnowed its losses from $284 million to $1 million by 2008 after shuttering factories and cutting costs. By then, though, Fleetwood was faced with the country’s deep financial slump.
Buyers couldn’t get bank loans to purchase an RV and dealers couldn’t get financing to order new models from manufacturers.
Plus declining property values meant many buyers could no longer draw on their home’s value and use the cash to buy an RV.
“What we are seeing in the RV industry at this time I don’t believe any dealer or manufacturer anticipated,” said Mellanie Ingle, spokeswoman for Giant RV – one of the largest RV dealerships in California with locations in Colton, Corona, Montclair, Murrieta, Westminster and Indio. “Giant RV is confident Fleetwood will emerge from the Chapter 11 filing. Fleetwood is the foundation of the RV industry.”
The Press Enterprise reported that the company was delisted from the New York Stock Exchange in January. It dropped from 7 cents per share to a penny per share in over-the-counter trading on Tuesday.
There will be 609 employees in Riverside – 200 in corporate headquarters, 93 in its manufactured housing operation and 316 building motor homes – down from a peak of a few thousand in the late 1990s.
In 1998, the company was one of the largest makers of motorhomes and travel trailers, with about a 26.1% market share in RVs and 21.6% share of the travel trailer market.
In 2007, it accounted for just 7.6% of the RV market and 5.9% of all travel trailers sold, according to the company’s most recent annual report.
Joe Hixson, a spokesman for Fleetwood, said there are no immediate plans for more layoffs.
The company is seeking bank funding to keep operating, but “we have what we believe to be sufficient cash for the immediate term,” Hixson said.
Monaco Coach Corp. filed for bankruptcy this month. Perris-based National RV sought chapter 11 protection in late 2007. Weekend Warrior Trailers of Perris closed in September last year.
Christian Eddleman, an analyst with Argus Research, said that Fleetwood’s move was just one more in an industry in serious contraction. “It’s just a nightmare scenario for the RV industry that’s not getting better,” he said.
Eddleman has advised stockholders to sell since the last quarter of 2007. “It’s likely that the shareholders are wiped out,” he said.
As for buyers for Fleetwood’s RV and manufactured housing divisions, the marketplace for struggling RV-related companies doesn’t include a lot of suitors.
“It would have to be someone with deep pockets,” Eddleman said.
Thor Industries Inc., Fleetwood’s competitor with more cash on hand and less debt, could be a possible candidate, he said. He also pointed to Warren Buffett’s Berkshire Hathaway Inc., which bought Indiana-based RV company Forest River Inc. in July 2005. Forest River bought Coachmen Industries Inc. in January.
According to the Press Enterprise, Hixson would only say Fleetwood is “moving with a sense of urgency with discussions with our buyers,” without naming those interested.
Several employees at Fleetwood’s Riverside factory where motorhomes are painted say they’re not discouraged by Tuesday’s news.
“You’re never prepared for this kind of stuff, but you see it happening on the street all the time,” said Ralph Montes, a 63-year-old maintenance supervisor who has been with Fleetwood for 21 years. “We might have some bumps and bruises, but we’ll come out of this OK.”
Montes and Andy Villegas, who works with him, said as of noon Tuesday that no employees have been told their jobs are in jeopardy, and they praised Fleetwood’s past employment practices.
“It’s a great company. We’re going to come out of this whole,” said Villegas, 49, who has been with Fleetwood since 1980. “It has good people and good managers. That’s why I’ve been here so long.”
Villegas said he accepts that the company is struggling because people are less likely to buy luxury items during a recession.
But there were weak sales due to the early 1990s recession, and the company survived that, he said.
“The airline companies had their problems, and they came out of it,” he said. “They’re still flying.”