Tom Montague has a big responsibility and a tiny office in Syracuse, Ind. The two situations seem to be a good fit.
Montague, the national sales manager for the newly formed Redwood RV, only needs a desk, a cell phone, a chair and two wall-sized whiteboards to do his job. Anything more right now would be a waste as he is rarely in his office, The Goshen News reported.
This past week Montague returned from a two-week tour of the country to sell Redwood’s new residential fifth-wheel unit. Much of that time was spent in Florida, where he visited seven of the top 10 RV dealers.
“When they saw the product, they could not believe the look and feel of the product,” Montague said.
Fifteen of the 17 dealers Montague and his crew visited, ordered the new fifth-wheel from Thor Industries Inc.’s newest company.
Creating a new company
Thor is an ever-growing force in the RV industry, but usually expands by acquiring existing companies. But that did not happen for the residential fifth-wheel niche, so Redwood was formed.
Thor made Redwood a division of Crossroads RV in Topeka, Ind., and has attracted experienced talent from across established RV manufacturers. Redwood’s president, Don Emahiser, moved over from leading Carriage Inc. Montague came over from another Thor company, Keystone RV co. Since then they, and other managers of the company, have been assembling a team to build Thor’s first residential fifth-wheel and market it to dealers.
The unit will be made in lengths from 35 feet to 39 feet long and be priced from $65,000 and up. There are three current floorplans. Five floorplans will be available in January. By spring, Montague plans to have eight floorplans in the Redwood stable.
So, why is Thor starting a new fifth-wheel company? To fill a segment of the RV market the company has not entered previously.
“Thor has spent millions of dollars to gain and then retain customers from the ’stick and tin’ all the way up to the Montana (a Keystone RV fifth-wheel). And they do a phenomenal job of that. One in every four coaches, I think, is a Thor product, maybe even more. At the end of that cycle we let that customer go to buy something like a DRV.”
But with Redwood coming online this fall, Thor loyalists will be able to step up to a residential fifth-wheel about $10,000 more than the top line towable.
With the whine of screwguns and hand drills in the background, Montague walked through a Redwood prototype on the factory floor. He pointed out the unit’s residential furniture. He picked up the mattress in the bedroom to show off the European-style slatted box springs beneath it. And he pointed out that the closet’s clothes rack extends the full width of the trailer.
These finishing touches have been worked out over the past few months. The details are listed on those white boards in his office. On those wall-covering boards are categories for appliances, carpeting, lighting, etc. Options for each are neatly printed in black marker ink.
But there are hundreds of RV models in the marketplace and even more floorplans for each. So how does a sales director decide what to go with in an initial offering? Feelings.
“When you go in, you want it to feel like home. Our goal was, when you walk in we wanted it to be warm,” Montague said.
That’s why the residential furniture was chosen, so the comfort and tactile feel is the same found in a residence. After all, it’s likely someone will sell their home to take to the road long-term in an RV like the Redwood.
The chassis and interior will sit on Lippert Components’ top-of-the-line Falcon Integrated Technology frame system. Redwood RVs will have a two-year bumper to bumper protection plan and a five-year structural warranty.
Montague has a goal for Redwood — it’s to sell 1,100 of the fifth-wheels during the company’s first year. Last week there were 11 units under construction in the 105,000-square-foot plant. Fourteen more are on order and in line for production. If the expected growth occurs, then up to 80 people will be making Redwood fifth-wheels within a year.
About that sales goal for the first year, Montague said, “That would be a phenomenal start.”
The first public showing of Redwood’s products will be made at the National RV Trade Show for dealers in Louisville, Ky. beginning Nov. 30.
Lippert Components entered into a license for the exclusive right to manufacture and sell the patent-pending RVLOCK, a remotely operated locking system for towable RV entry doors.
“This sleek new battery-operated system integrates the remote features into the door handle and eliminates the need for multiple parts which are currently necessary, reducing warranty exposure. RVLOCK also eliminates the need for hard-wiring to the vehicle’s electrical system,” Jason Lippert, CEO of Lippert Components, stated in a press release.
“We estimate that during 2010 approximately 270,000 towable RV entry doors will be produced by the industry. Each year, more and more remote locking systems are used on RV entry doors,” Lippert said. “In addition, we plan to market entry doors with the RVLOCK to the equestrian and cargo trailer industries. The easy installation, enhanced security, and contemporary styling of the RVLOCK will allow us to continue as the leading manufacturer of RV entry doors. We believe that RVLOCK is the most advanced locking system available and that it will appeal to both RV manufacturers and retail customers. We look forward to continuing to work with the inventors of RVLOCK, who have agreed to make other innovative related products available to us.”
Fred Zinn, president and CEO of Drew Industries Inc., Lippert Components’ parent company, said “The acquisitions of these new products and services continue our history of successfully increasing our RV content per unit, a critical component of our long-term strategy. The initial cost of these transactions aggregated less than $1 million, which was paid from available cash. Future royalties on the RVLOCK will be based on sales.”
Lippert Components has acquired the operating assets of Sellers Mfg. Inc., a Milford, Ind.-based firm which modifies chassis primarily for producers of Class A and Class C Motorhome RVs, transit buses and specialized commercial trucks.
The purchase was completed on Aug. 30. The purchase price was not disclosed.
Automotive manufacturers of these types of chassis produce standard-length chassis, and Sellers Mfg. customizes the chassis lengths to meet the particular needs of motorhome, transit bus and specialized commercial truck producers, according to a press release. The chassis modification process requires an array of fabricated steel parts that are within Lippert Components’ existing capabilities, which will eliminate the need for outsourcing. In addition, Sellers Mfg. manufactures the patented E-Z Cruise, a suspension enhancement system for transit buses and Class C Motorhomes, which improves the vehicle’s ride performance.
“We expect that our long-standing relationships with producers of motorhomes and transit buses will enable us to expand Sellers Mfg.’s customer base and market share, and increase our penetration into these markets. The Sellers Mfg. facility, which we are leasing, is large enough to allow us to grow this operation and meet increasing demand,” said Scott Mereness, president of Lippert Components.
“The regional market for customizing motorhome chassis currently exceeds $15 million annually, and we are excited about the opportunities this new capability presents,” said Todd Driver, national operations director of Lippert Components. “Working with Sellers Mfg.’s experienced team, our goal is to capture a significant share of this market and increase our sales of related products for motorhomes.”
A service technician for Berryland Motors in Ponchatoula, La., has filed suit against a motorhome manufacturer, saying he fell out of the vehicle when its steps gave way.
Brian David Easley and Stephanie Carlin Easley filed suit against Forest River Inc,. Lippert Components, a division of Drew Industries Inc., Drew Industries and Lippert Acquisition Corp. June 2 in Tangipahoa Parish District Court. The defendants removed the case to federal court in New Orleans July 6, The Louisiana Record legal journal reported.
Brian Easley says he was walking down the steps of a Georgetown model motorhome in July 2009 when those steps failed, causing him to fall. Easley says he fell forward and landed on the concrete with his foot still caught in the collapsed steps. Easley says he ruptured a disc in his back during the fall. He says the injury required him to undergo surgery to replace the ruptured disc with an artificial one and place a metal cage around the vertebra with two rods along both sides of his spine.
Easley says the steps that caused his fall were recalled by the manufacturer Lippert Components.
“Forest River Inc. is liable under the Louisiana Product Liability Act because the motorhome which it manufactured was unreasonably dangerous because of the defective condition of the steps,” the lawsuit states.
Easley argues the motorhome was unreasonably dangerous due to the inadequacy of the bolts used in the design. He also says the design of the steps caused undue stress to be placed on the bolts used to secure the steps permitting them to fail under normal usage.
Easley is seeking damages for pain and suffering, mental anxiety and distress, physical injury, impairment of function, loss of life’s pleasures, loss of recreational activities, change in lifestyle, medical expenses, lost wages and benefits, future lost wages and loss of earning capacity, interest and court costs.
Stephanie Easley is seeking damages for loss of consortium, services and society.
The plaintiffs are represented by Charles R. Moore and Patrick N. Broyles of Moore, Thompson, Lee & Broyles in Baton Rouge.
U.S. District Judge Helen G. Berrigan is assigned to the case.
Level Up achieves this feat utilizing the power and speed of Lippert’s jacks, which are on average 10 times faster than their electric counterparts. Level Up utilizes a one touch ”auto level” button that allows the camper to hit a button and let the system do its job in less than 30 seconds.
Level Up’s patented six-point leveling system incorporates a pair of front hydraulic landing gear and pairs of hydraulic leveling jacks before the front axle and behind the rear axle. It is the only leveling system on the market that is sensitive to the integrity of the frame.
The user cannot put the jacks in a lifting sequence that would twist the chassis causing damage to the coach. This is the biggest difference between Level Up and the traditional four-point systems that have been in the field for a while.
Currently, Lippert Components is working with several OEM’s to provide ”Level Up Ready” frames where the customer can add Level Up as an option at the time of purchase, or add it to their coach later.
”We feel there is a large population of campers that will see the upgrade to Level Up as a worthwhile investment,” Lippert said. Lippert Components is currently setting up a dealer network certified to install Level Up in addition to the Trail Airservice center in Goshen, Ind., that has been installing Level Up for the last year and a half.
To learn more, visit www.lippertcomponents.com
Lippert Components and Kinro, subsidiaries of Drew Industries Inc., announced today (May 6) that Andy Murray has been promoted to national director of sales.
Murray, a 15-year veteran of the RV industry, has served in various capacities at Lippert Components during the last seven years, steadily expanding his knowledge of the company’s products and becoming acutely aware of customer requirements, according to a news release.
“Andy has been a leader in implementing our unsurpassed culture of customer service,” said Jason D. Lippert, president and CEO of Lippert Components and Kinro. “He has a great understanding of our capabilities, and he knows how to use those capabilities to develop solutions for our customers. Andy’s devotion to serving our customers has greatly contributed to our growth and to the wide variety of new products we have introduced. He will continue to focus on product development and strategic planning for marketing and sale of Lippert and Kinro’s RV products.”
“In his new position, Andy will serve on the executive committees of Lippert Components and Kinro, adding to our management team his vision, energy, and strategic thinking,” added Lippert. “It is people like Andy that separate us from all other vendors, and we will make sure that he has all the resources needed to continue providing the best possible service to our customers.”
Drew Industries Inc. reported Tuesday (March 16) that its wholly owned subsidiary, Lippert Components Inc., completed the previously announced acquisition of certain intellectual property and other assets from Cassopolis, Mich,-based Schwintek Inc.
The purchase included several products for which patents are pending, including an innovative wall slide-out mechanism, an aluminum cylinder for use in leveling devices for motorhomes and a new tent camper device, according to a news release.
The purchase price consists of $20 million paid at closing from available cash, plus an earn-out which is expected to aggregate $10 million to $15 million over the next three to five years, depending on future unit sales of these products in excess of pre-established hurdles. Mike Schwindaman and Mike Howard, the owners of Schwintek, entered into consulting, product development and non-competition agreements with Lippert Components.
“Our strong balance sheet and cash position enabled us to complete this acquisition without incurring debt,” said Fred Zinn, Drew president and CEO. “We still have adequate cash to continue to pursue expansion opportunities that we believe will yield favorable returns on our investment.”
“Largely through new product introductions and market share growth, we have more than tripled our content in the average travel trailer and fifth-wheel RV, from $670 in 2001 to $2,101 in 2009. These new products fit into our long-term plan to continue to increase our content in all types of RVs,” said Zinn. “Mike Schwindaman has a proven ability to design new products that are both extremely functional and efficient to manufacture.
The product development agreements with Schwindaman and Howard “greatly expand the R&D capabilities of Lippert Components, and provide a framework for our purchase of additional RV products they design over the next five years. They are already working on a ‘new concept’ leveling device for motorhomes that utilizes the aluminum cylinder we just purchased.”
“The new wall slide-out design is expected to gain substantial market share in both the motorhome and towable RV markets, because of its significant advantages over many other slide-out mechanisms,” said Jason Lippert, President and CEO of Drew’s subsidiaries, Lippert Components and Kinro Inc. “This wall slide-out mechanism is considerably lighter and more space efficient. It also minimizes the need for manual adjustments by the RV user, significantly reducing one of the biggest warranty issues for RV dealers. Schwintek and Lippert Components have been selling this wall slide-out for several months, and it has generated a high level of interest throughout the RV industry. Lippert Components will now be the exclusive supplier of this product. We are also exploring alternative applications for this design, for example, in our power TV lifts.”
“We will be manufacturing the products we acquired in our existing factories with very little additional overhead, which should allow us to be highly efficient,” said Lippert. “As a result, we expect this acquisition to be accretive to our earnings in the first year. Further, we expect to leverage our extensive marketing and distribution capabilities to continue to gain market share.”
Drew Industries Inc., a leading supplier of components for recreational vehicles and manufactured homes, today (Feb. 16) reported net income for the fourth quarter ended Dec. 31 of $2.9 million.
Net income for the quarter was reduced as a result of charges related to plant closings and start-ups and employee relocation, according to a news release.
In the 2008 fourth quarter, the White Plains, N.Y.-based company reported a net loss of $9.2 million, including charges for goodwill impairment and executive retirement aggregating $4.9 million after taxes and charges for plant closings and severance aggregating $800,000 after taxes.
Net sales in the 2009 fourth quarter were $105 million, up 37% from the $77 million in the fourth quarter of 2008. This sales increase was largely the result of an 88% increase in industrywide wholesale shipments of travel trailers and fifth-wheel RVs, partially offset by a 27% decline in industry-wide production of manufactured homes.
“During 2008 and the first eight months of 2009, RV dealers and their lenders focused on reducing inventories, resulting in a decline of an estimated 70,000 units,” said Fred Zinn, Drew president and CEO. “In 2009 alone, dealer inventories of travel trailers and fifth-wheel RVs declined by an estimated 30,000 units, implying that retail demand significantly exceeded industrywide wholesale shipments. Over the past few months, it appears that dealer inventories have stopped declining, and as a result, production levels have increased. Evidence of improved industry conditions and Drew’s market share growth has certainly been seen in January 2010, as our net sales increased to $44 million, well more than double our January 2009 net sales.”
“We are extremely pleased to end 2009 on such a positive note, particularly after the very bleak landscape we faced in the RV industry just a year ago, when most of our customers were shut down for extensive periods of time, and industrywide production of RVs was running at the lowest level in decades” said Jason Lippert, president and CEO of Drew’s subsidiaries, Lippert Components and Kinro.
“While the RV industry has a long way to go to get back to where it was a few years ago, industry-wide production levels for travel trailers and fifth-wheel RVs have been well above year-earlier levels for five consecutive months,” Lippert said. “Our customers are running their factories five days a week, even in the seasonally slow winter months. Of course, increased retail demand for RVs is the key to a sustained recovery. In this regard, reports from January and February 2010 RV trade shows have been encouraging; however, we are eager to see how the RV consumer responds in the upcoming spring selling season.”
“While industrywide production of RVs has increased, production in the manufactured housing industry has continued to decline. In addition, we are likely to see further year-over-year declines in industrywide production of manufactured housing over the next several months, partially due to the scarcity of retail financing, and continued reductions in inventory on dealer lots,” said Zinn. “While we tend to focus on our accomplishments in the RV industry, we are extremely pleased that, despite the severe conditions in the manufactured housing industry, Drew continued to be profitable in this segment by carefully controlling costs.”
Costs of the company’s primary raw materials increased in the fourth quarter of 2009, which had a modest impact on fourth quarter results. “Steel and aluminum prices increased 10-30% in the second half of 2009, depending on the type,” said Scott Mereness, executive vice president and COO of Lippert Components and Kinro. “Over the past few months, steel and aluminum prices have leveled off, and some analysts are projecting that there will be no significant changes at least in the near term. We anticipate that these increases in the cost of steel and aluminum will have a modest impact on our future profit margins as compared to the 2009 fourth quarter.”
For the year, Drew reported a net loss of $24.1 million, due to the first quarter goodwill impairment charge of $29.4 million, net of taxes. Excluding the goodwill impairment charge, net income for 2009 was $5.2 million. During the year, the company also incurred expenses totaling $5.5 million, net of taxes, resulting from plant closings and start-ups, staff reductions and relocations, increased bad debts and obsolete inventory and tooling, largely due to the unprecedented conditions in the RV and manufactured housing industries.
For 2008, Drew reported net income of $11.7 million, including $4.9 million of after-tax charges for impairment of goodwill and executive retirement. Excluding these charges, net income for the year was $16.6 million.
Net sales for the year ended Dec. 31, 2009 were $398 million, a 22% decline from the $511 million in 2008. This compares to a 25% decline in industrywide wholesale shipments of travel trailers and fifth-wheel RVs, and a 39% decline in industry-wide production of manufactured homes.
“Even before the sharp deterioration in the economy, we had made significant strides, including consolidating numerous manufacturing facilities and substantially reducing fixed costs,” said Zinn. “Throughout 2009, we continued to focus on both controlling costs and increasing our content per RV and manufactured home. We reduced fixed costs by $9 million in 2009 compared to 2008, and these cost reduction initiatives will generate further savings of about $3 million in 2010. We are also particularly pleased that our content per travel trailer and fifth-wheel RV increased nearly 9% in 2009.”
“Our efforts to identify and introduce new products were evident at the annual RV show held in Louisville in December, where we displayed numerous new and improved RV products that focused on consumer safety and convenience, including our Quick-Bite™ coupler, an improved suspension system, entry doors with alarm systems and keyless entry, a “new-look” line of windows, and an innovative new wall slide-out mechanism,” said Lippert. “In our manufactured housing segment, we recently introduced a new line of entry doors, and increased our efforts to expand our share of the market for replacement windows, doors and bath products.”
Drew’s RV Segment also manufactures specialty trailers for hauling boats, personal watercraft, snowmobiles and equipment.
In 2009, nearly 93% of the company’s RV segment net sales were components for travel trailer and fifth-wheel RVs, with the balance primarily comprised of components for motorhomes and specialty trailers. The RV segment represented 78% of the company’s consolidated net sales in the fourth quarter of 2009, up from 62% in the 2008 fourth quarter.
Drew’s RV segment reported operating profit of $7.2 million, on net sales of $82 million in the 2009 fourth quarter, compared to an operating loss of $3.1 million on net sales of $47 million in the comparable period in 2008. Segment operating profit in the 2009 fourth quarter was reduced by $1.3 million due to expenses related to facility closings and start-ups, and employee relocations.
“The increase in RV segment operating profit compared to last year was greater than we would typically expect on the $35 million increase in net sales, primarily because of fixed cost reductions and lower warranty costs,” said Joe Giordano, Drew CFO and treasurer. “In addition, operating results for the 2008 fourth quarter were adversely impacted by unusually high raw material costs and the sharp decline in sales, which adversely impacted production efficiencies.”
“RV segment net sales in the fourth quarter of 2009 increased 74% over the depressed levels in the 2008 fourth quarter,” continued Giordano. “This percentage increase was less than the 88% increase in industrywide wholesale shipments, in part because of the greater-than-usual lag between the time we shipped our products to the RV manufacturers in the 2008 fourth quarter and the time they sold the RVs to dealers, and in part because our marine trailer operation on the West Coast continues to be severely impacted by industry declines.”
For the full 2009 year, Drew’s RV segment reported net sales of $308 million, a decrease of 16% from 2008, compared to a 25% decline in industrywide wholesale shipments of travel trailers and fifth-wheel RVs. Excluding the impact of the acquisition in 2008, net sales by Drew’s RV segment declined 20%.
“Acquisitions, new product introductions and market share growth have enabled us to increase our product content for travel trailers and fifth-wheel RVs by 9%, to $2,066 per unit in 2009, compared to $1,902 per unit in 2008,” added Lippert.
RV segment operating profit was $20.0 million for the full year 2009, after giving effect to $5.3 million of expenses related to plant closings and start-ups, staff reductions and relocations, increased bad debts and obsolete inventory and tooling.
“The improvements experienced in the RV industry and our RV business over the past few months were a very welcome relief after the difficult conditions in the first half of 2009 and much of 2008,” noted Zinn. “Given our sales growth in January 2010 and efficient operations, we anticipate solid first quarter results in this segment.”
Fire caused an estimated $100,000 to $150,000 damage late Friday (Jan. 29) at a Lippert Components plant in Goshen, Ind.
The Elkhart Township Fire Department responded to a blaze at the facility at 65781 Sourwood Drive shortly after 11 p.m., according to The Goshen News.
According to Fire Chief Steven Chupp, the fire started in an oven and spread to the south end of the plant, causing damage to a powdercoat machine as well as to a utility area. The department, with help from the Clinton Township, Benton Township and Goshen departments, took approximately an hour and a half to bring the fire under control.
There were employees working at the time, but all managed to escape.
“No one was injured, but there were a lot of cold feet and fingers,” Chupp said.
Chupp said his damage estimate could be higher depending on the electrical components and other equipment that may have also been damaged.
The fire was ruled an accident.
Kinro Manufacturing, a subsidiary of Drew Industries Inc., plans to begin manufacturing windows and doors for recreational vehicles at a facility in Pendleton, Ore., according to the Mid Columbia Tri City Herald, Kennewick, Wash.
The company would bring up to 80 jobs to the community, said Tracy Bosen, the city’s economic development director.
The plant is expected to start in late September, Bosen said.
The plant previously was used to manufacture RV chassis by another Drew subsidiary, Lippert Components, Bosen said.