Electric Motors Corp. a leader in the emerging electric vehicle industry, continues to move forward with its plans to establish a strategic manufacturing center in northern Indiana. As part of this initiative, the company has announced an agreement with Livernois Vehicle Development, one of the largest automotive engineering firms in Detroit, according to a news release.
An industrial automation and assembly expert, Livernois will provide the engineering services to ensure that EMC’s electric drive train systems are fully compliant with the chassis and body parameters of light-, medium- and heavy-duty vehicles, including the Ford F-150 pickup, which will be retrofitted with EMC’s electric drive train systems. Livernois will be launching an electric vehicle engineering division as a direct result of its joint venture with EMC.
“Livernois is very excited about partnering with EMC on this exciting new project,” said Norma Wallis, president of Livernois Vehicle Development. “It’s a real boost for the economies of both Indiana and Michigan. We’re creating new products as well as a new future by bringing the automotive market here in Michigan, together with the expertise of the recreational vehicle industry in Indiana.”
In addition to its new partnership with Livernois, EMC has entered into agreements with several other automotive manufacturing companies in Indiana and Michigan, including recreational vehicle manufacturer Gulf Stream Coach Inc. “Our partnership with Livernois, as well as with other leading companies, represents the beginning of a much larger network of suppliers, manufacturers, and other vendors to the electric vehicle industry,” said Wil Cashen, EMC’s CEO. “Incorporating electric drive systems into existing vehicles is fast becoming a significant part of the automotive industry’s future. Livernois’ superb engineering skills will help us achieve that goal faster and more efficiently.”
Part of EMC’s grand design is to establish Elkhart County, Ind., as the center of the electric vehicle industry in the United States. Elkhart, known as the capital of the recreational vehicle industry, has been hit especially hard by the recession, with unemployment topping 18%. EMC’s Elkhart County facilities are expected to drive a significant number of jobs to the area.
“There are three factors coming together to make the ‘perfect storm’ for the electric vehicle industry,” said Cashen. “The availability of federal loans will stimulate even more innovation in this area, and tougher CAFE standards means the auto industry as a whole is taking EV technology very seriously. But beyond government programs, the biggest factor driving this fledgling industry is the renewed entrepreneurial spirit we’re seeing once again throughout the automotive community, as established auto manufacturers and new innovators alike create a whole new class of automotive technology. We’re proud to be a leader of that movement.”
T.R. Arnold and Associates Inc. – an internationally accredited certifier of quality management systems based in Elkhart, Ind. – now is turning its expertise to the recreational vehicle industry and the growing desire among manufacturers and consumers for environmentally friendly RVs and recreational park trailers.
Operating under the name TRA Certification Inc., the company already has demonstrated its ability to certify “green construction” in the manufactured and modular housing industries. It has to date certified five companies as green capable and is in the process of certifying several others.
Arnold founded his company in 1967; it now is an employee-owned company. Besides work with factory-built homes and buildings, it also offers a complete line of inspection and consultation services to the RV, cargo trailer and park trailer industries.
In order to certify a building or an RV as environmentally friendly, there would naturally have to be some sort of an industrywide consensus standard of what it means to be “green.” Although there is a consensus standard for the RV Industry, no green requirements exist. So, Tom Arnold, president of TRA Certification, said to implement a standard he turned to the National Green Building Standard to develop a standard — a consensus standard for single-family dwellings established by the American National Standards Institute, the Association of Home Builders and the International Code Council.
“We’re using this as a platform to implement the applicable parts of this for the recreational vehicle industry,” said Arnold. By using an existing standard developed through the consensus process, Arnold feels he is ensuring that any green certification his company makes is legitimately environmentally friendly.
The first step in the certification process is to certify the manufacturer is green-capable. “We go to the factory and we look at what’s going on with their processes,” said Arnold. That involves examining their recycling programs and manufacturing methods to ensure they are able to produce green compliant RVs. “We’re giving the manufacturer who is doing a good job recognition for what they do,” said Arnold.
The second step in the process is to examine the materials and appliances that go into making the RV.
Arnold said that any supplier can claim his materials are environmentally friendly, but “the engineer (at the manufacturer) does not have the time to do the research.” TRA Certification, he points out, does that for the manufacturer.
Arnold said TRA Certification is just now launching its green certification program and he fully expects to have many manufacturers certified by the end of the year. “We have proposals out to several park trailer companies now,” he said.
His staff for the company already is in place. Amanda Leazenby, who has professional accreditation in Leadership in Energy and Environmental Design, is the manager of the program. Clay Huth will serve as director of marketing, and Sherman Hansen is a green certification consultant.
For more information on TRA Certification’s green program, contact Amanda Leazenby at 700 W. Beardsley Ave., Elkhart, IN 46514, (574) 264-0745 or visit the company’s website at www.tragreen.com.
Editor’s Note: This column was written by veteran Hoosier writer Brian Howey following President Obama’s visit to Elkhart County, Ind. The columnist publishes at www.howeypolitics.com.
If there is an American city that will be chiseled into President Barack Obama’s legacy – whatever it turns out to be – it will be Elkhart. Of the 52 visits Obama has made to Indiana since March 2008, four of them have come in or close to this epicenter of the recreational vehicle industry.
During the presidential campaign, he vowed not to “forget” the city and county that was hit by $4.20 a gallon gas, a collapse of Wall Street credit and then the cascading bad news from companies like Monaco, Jayco and Keystone. By the time Obama returned on Feb. 9, the jobless rate was more than 15% – or a 10% increase, which he described as “astonishing.” In making his pitch for a $780 billion stimulus package, Obama told an overflow crowd at Concord High School, “I promised you back then that if elected, I’d do everything I could to help this community recover and that’s why I came back today, because I intend to keep my promise.”
Earlier visits gave clear indicators to what Obama had in mind. In the same gym on Aug. 6, 2008, candidate Obama reminded the city and nation that this energy dilemma was 30 years in the making. The gas lines of 1979 caused by the Iranian revolution plunged Elkhart into a near depression that peaked in 1982. “Elkhart, this did not happen by accident,” Obama said. “We’ve had a real energy problem with no real solutions. We didn’t have an energy plan, we had an oil company plan. We offered gimmicks, rather than solutions.”
And his Aug. 6, 2008, solutions?
Obama vowed to wean the U.S. off Middle Eastern and Venezuelan oil within a decade. He vowed to charge scientists and engineers to “get behind a new approach to energy,” create more electric hybrid cars and RVs and expand the electric grid. He summoned the legacy of President Kennedy, who vowed to put an American on the moon “even though the technology didn’t exist” at the time and added, “We can set those kinds of goals today.”
On Feb. 9, 2009, President Obama described the stimulus plan that would pass eight days later in point No. 2: “There is money allocated in this plan to develop the new battery technologies that will allow not just cars but potentially RVs as well to be — to move into the next generation of plug-in hybrids that get much better gas mileage, that will wean ourselves off dependence on Middle Eastern oil, and will improve our environment and lessen the potential effects of greenhouse gases and climate change.”
Thus, the stage was set for Wednesday, when Obama ventured just south of Elkhart to the embattled town of Wakarusa, the scene of what he described as “the perfect storm.” The jobless rate here is 16%. Appearing at a Monaco RV plant – whose closing was a precursor to the emphatic pain that would follow – Obama brought home the bacon and provided a beacon. He announced $2.4 billion in federal stimulus funding for advanced battery and electric vehicle manufacturing at Wakarusa, with seven emerging Indiana companies and 11 in Michigan making the cut.
“The battle for America’s future will be fought in Elkhart, Detroit, Goshen, Pittsburgh, South Bend and Youngstown,” Obama said. “It will be won by making places like Elkhart what they once were.”
In announcing the $2.4 billion in grants – which he described as the “The largest boost in research in history” – Obama described his plan as “planting the seeds of progress and good paying jobs. That’s what we do best in America: We turn ideas into inventions and inventions into industries.”
With money coming to EnerDel and Allison Transmission in Indianapolis, Delphi in Kokomo, Magna in Muncie and Remy in Anderson, Obama explained, “For too long we failed to invest in this kind of innovative work, even as China and Japan were racing ahead. I’m committed to a strategy where American leads. This is about creating the infrastructure of innovation. Indiana is the second largest recipient of grant money.”
Obama said that the state – home to Purdue, Notre Dame, Indiana universities and IVY Tech – will be a place where engineers are educated and innovation will thrive. He reminded people that he has made the research and development tax credit permanent. “This tax credit returns $2 to the economy for every $1 spent. The real innovation depends not on government, but the potential of the American people,” Obama said. “They’ll figure out how to do it.”
Standing in the Monaco plant, Obama said, “Just a few months ago folks thought these factories were closed for good. These grants will create tens of thousands of jobs all across America.”
He added, “I don’t want to import a hybrid truck, I want to build a hybrid truck right here. I want to build a windmill right here in Indiana.”
Say what you want about our 44th president, but what is unmistakable is that he is staking the success of his presidency here in Indiana, even as rival politicians criticize his rescue of Chrysler and General Motors, his cap-and-trade plans, the health care reforms he calls vital to the economy, and the stimulus.
Elkhart becomes the common thread that bridges the crisis of 2008 to an unfolding future.
The recreational vehicle industry’s Go RVing Coalition has directed its marketing firm, the Richards Group, Dallas, Texas, to “reinvigorate” its national campaign with new television commercials for 2010 utilizing existing – and perhaps some new — video and still photography.
It’s an economical approach that allows the coalition to put on a fresh — if not altogether new — face for 2010, and it was unanimously agreed upon Monday (June 8) when the coalition met during RVIA Committee Week in Washington, D.C.
Revenues with which the coalition buys ads are down this year, of course, because those funds are generated by assessments on RVIA seals and, due to the economy, seal sales are down considerably. In fact, the Go RVing media budget was trimmed to $3.5 million this year from a high point of $15.5 million two years ago, RVIA Vice President and Chief Marketing Officer Gary LaBella told the assembled coalition members.
The new ads will likely debut at this winter’s Louisville Show and on television in February.
Coalition Co-Chairman Tom Stinnett, owner of Tom Stinnett RV Freedom Center, Clarksville, Ind., said that the Go RVing campaign continues to be important to the industry, even at a reduced spending level.
“It’s very important, even with 20% of the budget that we once had,” Stinnett said. “We all know that there will be a rebound. It makes a lot of sense that, whatever we do with whatever limited budget we have, will help us rebound better and faster when the time comes.”
With economist Richard Curtin of the University of Michigan estimating that RV sales will increase 24% next year — plus or minus 15% — LaBella figures the Go RVing media budget will total “almost $5 million” in 2010. “We have been doing great things with the money that we have, considering everything that is going on in this economy,” he said..
All in all, most coalition members seemed to agree, the Go RVing campaign – along with related public relations efforts by the RVIA staff – has played a key role in bolstering the RV industry’s image during these very trying times.
“It’s no accident that our image to date has not been wounded,” LaBella said, noting that the boating industry’s “Grow Boating” campaign — fashioned after Go RVing — has been scrapped altogether due to economic conditions.
“By keeping our image high, we are going to be in a better position when the economic situation turns around, to come out of this faster than anybody else in terms of discretionary purchases” LaBella said. “There is going to be pent up demand because people are still very interested in our products.”
“I think this program is the lifeblood of our industry,” Thor Industries Inc. CEO Richard E. “Dicky” Riegel, a coalition member who supported revamping the advertising creative for 2010, told the coalition.
Lance Wilson, executive director of the Florida Recreation Vehicle Trade Association, also favored staying the course right now with the national ad campaign by investing as much as $550,000 in revamped ads. “I think it’s a great idea and we need to move forward with it,” Wilson said.
The new campaign materials will be drawn from photos and video footage that wasn’t used during earlier campaigns — the theme of the most recent phase being “What Will You Discover?” The 2009 campaign ads have been exposed to a wide array of audiences, from NASCAR races to rodeos and the Kentucky Derby plus the PBA bowling circuit as well as more sedate audiences focused on the National Geographic Channel. Print ads ran the gamut from Budget Travel to Midwest Living.“If we produce new creative at this time, it’s an opportunity to reenergize and reinvigorate the industry,” the Richard Groups’ Chad Strohl told the coalition. “It’s all about getting leaner and smarter while trying to achieve maximum effect. A key point is that it will allow us to get ready with a fresh message as the economy does turn around.”
With regard to dealer participation in the Go RVing program, meanwhile, Phil Ingrassia, vice president of communications for the Recreation Vehicle Dealers Association (RVDA), said fewer dealers signed up this year than last. Enrollment is down from about 700 dealers in 2008 to 450 this year. “We are working very hard in a one-on-one mode calling dealers who had signed up in the past who haven’t signed up this year,” Ingrassia said.
Dealers who pay $225 a year have access to Go RVing-themed promotional material along with retail leads from potential RV buyers who contact Go RVing on its website or by telephone
“Our numbers aren’t where we would want them to be, but we have a good strong core of dealers participating in the program who are downloading leads every day,” Ingrassia told the coaltion members. “We hope to add to that was we move forward.”
The National Highway Traffic Safety Administration (NHTSA) has issued recall notices for the following products related to the recreational vehicle industry:
- 176 (2009) Forest River Cardinal fifth-wheels that fail to comply with the requirements of Federal Motor Vehicle Safety Standard No. 120, “Tire Selection and Rims for Motor Vehicles Other Than Passenger Cars.” Due to faulty scales in the production facility, the label for the cargo carrying capacity values is incorrect.
- 58 (2010) Heartland Recreational Vehcless LLC Eagle Ridge fifth-wheels. The LP line for the kitchen slideout was improperly routed which allows the line to rub against the tire, damaging the LP hose and wiring.
- 2,052 (2002-2009) Airstream Inc. Bambi, International, Safari, 75th Anniversary, DWR and Ocean Breeze travel trailers for failing to comply with the requirements of Federal Motor Vehicle Safety Standard No. 108, “Lamps, Reflective Devices and Associated Equipment.” The travel trailers were built without rear reflex reflectors.
- Seven (2009) Fleetwood Tradition Class A motorhomes for failing to comply with the requirements of Part 567, “Certification.” The federal certification tag figures related to the towed weight and tongue weight are incorrect.
- 311 (2009) Fleetwood Providence, Excursion, Expedition, Discovery and Bounder diesel motorhomes. The battery cable may become dislodged and come in contact with the drive shaft causing entanglement or abrasion to the battery cable.
- 484 (2008-2010) Spartan ADV, BEY, FUR, GLC, GLD, K2, K3, MG, MM, MTR and NVS fire truck, ambulance and motorhome chassis manufactured between July 1 and Dec. 16, 2008, equipped with certain Haldex quick release valves (QRV). The rubber diaphragm inside the QRV may experience delamination resulting in significant levels of air pressure leakage past and/or through the diaphragm, or the development of a bubble in the diaphragm which may trap air pressure in the valve and not allow the service brakes to release.
- An unspecified number and model year of Winnebago motorhomes equipped with axles that include Bosh ZOPS or ZOHT pin slide hydraulic disc brakes. The claiphers may stick in the applied position and can result in abnormal heat generation at the wheel end causing brake drag.
Jobless rates rose in all the largest U.S. metropolitan areas for the fourth straight month in April, a trend likely to persist even as the recession eases, according to the Associated Press.
The Labor Department said Wednesday (June 3) that unemployment in April rose from a year earlier in all 372 metropolitan areas it tracks. The rate for Elkhart-Goshen in Indiana jumped to 17.8%, up 12.7 percentage points from a year ago. The region, which posted the largest increase from last year, has been pounded by layoffs in the recreational vehicle industry.
The second-highest jump occurred in another RV manufacturing community, Bend, Ore. Its rate rose to 15.6%, up 9 percentage points from last year. The region of North Carolina’s Hickory-Lenoir-Morganton saw its unemployment rate rise to 14.9%, a gain of 8.8 percentage points from last year.
Editor’s Note: MSNBC.com is conducting a year-long study of Elkhart, Ind. This 2,300-word story, which appeared in The Elkhart Truth, is the latest installment in a series of stories from that project.
In the same way that people might speculate about a couple that could be heading for divorce, business leaders in Elkhart, Ind., sometimes talked about what could happen if the recreational vehicle industry took a serious turn for the worse.
They’d seen it happen before in the early 1970s with the energy crisis and in other recessions since. But this was back a few years ago, when business was booming, and such talk seemed more theoretical than practical, as you might discuss the need to get a new roof, eventually.
“Yeah, there may be a desire to implement change, or diversify,” said Brian Gildea, economic development director for the city of Elkhart. “But when it’s not broken, the impetus to change is not there.”
Now the so-called “RV Capital of the World” is seeing a scenario that even the most pessimistic didn’t think would come to pass.
A season of high gas prices, a deep and lasting recession, a drop in home and investment values and a severe shortage of credit have conspired to decimate the RV industry, which officials say once accounted for as many as one in four jobs here.
The unemployment rate in Elkhart County hit 18.8% as of March, up from just 5.8% a year earlier. That was the largest jobless rate increase of any metropolitan area in the country.
Many local companies, including RV makers and their vast network of small, independent suppliers, have either cut back or gone out of business entirely, leaving the community with millions of square feet worth of vacant manufacturing buildings and thousands of unemployed workers.
‘Diversification is easy to talk about …’
The hard fall for Elkhart’s economy shows the dangers of depending too heavily on one industry for economic health, but also the difficulties of diversifying away from the main engine of a community’s economic activity. As Elkhart struggles to recover, residents are seeing firsthand the monumental task of clawing back from such a massive economic hit at a time when virtually every city in the nation is also suffering from the recession.
“Diversification is easy to talk about, but it’s not easy to bring about,” said Bill Johnson, who several years ago led an effort called the Horizon Project that aimed, in part, to draw a more diverse group of businesses to Elkhart County.
Experts point to success stories such as Akron, Ohio, which was able to create a niche in the polymer industry when the rubber industry began to decline. But they also offer up cautionary tales such as Gary, Ind., which has struggled for decades since the heyday of the steel mills.
The hard truth, many say, is that making an economy less reliant on one major industry can take a decade or more. Ned Hill, dean of the Levin College of Urban Affairs at Cleveland State University, said success often depends on politicians and business leaders who can help a community grow while not fighting too hard against market forces.
“The No. 1 rule is: Don’t allow yourselves to be a victim. You don’t want to do what Youngstown did and what Philadelphia did and say, ‘It’s always come back, it’s going to come back one more time,’” Hill said.
Youngstown, Ohio, has taken years to recover from the decline in steel, while Hill faults Philadelphia-area politicians for spending too much time and money battling cutbacks at its Naval Shipyard, which once employed thousands.
‘They will come back’
Many in Elkhart insist that the RV industry will revive, citing the allure of the open road and desire to be in the outdoors that stokes long-term demand. But even the most optimistic concede this recession has been deeper and more troubling than past downturns. If the RV industry emerges, it may look different than it did during the boom times just a few years ago.
“We don’t have an industry that’s no longer viable,” said Gildea, the Elkhart economic development director. “They will come back. It’s just a question of at what level.”
That leaves Elkhart, along with countless other communities across the Midwest, struggling with the question of what other businesses they can attract to the area. The additional conundrum for Elkhart – and many other communities in Indiana, Michigan and Ohio – is that they have continued to rely mainly on manufacturing for their economic well-being rather than transitioning to more service-oriented work.
Manufacturing accounted for about half of the Elkhart area’s jobs during the boom times. With the recession, that figure has dropped to around 43%, according to state statistics, still well above the national average.
“There’s a lot of diversity in this county in the sense of manufacturing. But that’s the issue: manufacturing,” said Richard Lavers, CEO of Coachmen Industries Inc., an Elkhart company that recently shed its RV business to concentrate mainly on modular homes.
“Is that a good or a bad thing? You play to your strengths,” Lavers said. “Unfortunately, manufacturing is becoming rarer and rarer and rarer.”
Even those who have long touted the importance of technology to the region concede that it would be hard to attract high-tech, white-collar jobs. Many manufacturing workers here have been able to make a very good living without a college education or advanced training. The area’s location, on a major interstate near the middle of the country, combined with its vast landscape of low-slung manufacturing facilities, make it ideal for such work.
“I see Elkhart remaining a primary manufacturing economy for the foreseeable future,” said Jim Walsh, vice president of the North Central Indiana Business Assistance Center. “I think the kind of manufacturing is going to change, (but) we’ve always prided ourselves: We make stuff.”
Walsh – who regularly runs workshops helping manufacturing operations become more efficient – still hopes technology will play a role in the area’s recovery.
“We’re still building things like we were 50 years ago, and we’re not going to last,” he said.
Elkhart’s woes may be more extreme than others around the country, but they are not unique. John Stafford, director of the Community Research Institute at Indiana University-Purdue Fort Wayne, said he’s watching many communities struggle with whether they can leave their manufacturing roots to evolve into more of a service economy.
“Every one of us is looking to answer that question,” he said.
Other Midwestern cities including East Peoria, Ill., a manufacturing hub for struggling Caterpillar, and Flint, Mich., once a mecca for auto manufacturing, are wrestling with a similar plight.
Diversity faded over the years
While it’s easy to judge such cities in hindsight, it can be almost irrestible to hitch the civic wagon to a single industrial star in good times.
“The reality is that if you’ve got an industry that’s paying good wages and good returns, the best bet is to go start working for them,” said Hill, the Cleveland State professor.
It also hadn’t always been this way in Elkhart. When Angie Recchio was growing up here, she figured she’d have her choice of three industries for a career: pharmaceuticals, band instruments and the RV business.
But by the time Recchio had grown up, earned a college degree and returned to her hometown, her choices had narrowed. The pharmaceutical and band instrument companies that were once such a major presence had mostly been sold to larger companies, who in turn sent thousands of those white-collar and factory jobs elsewhere.
For her and her peers, it seemed like the options were to go into the RV industry or get a service job, perhaps at a car dealership or restaurant.
Recchio, 33, chose the RV industry. Now she works as a sales representative for Valley Screen Process Co., which makes decals, mostly for RVs. She believes the RV industry will revive but says the downturn has prompted her company to look more aggressively for other customers.
“Maybe it’s a wake-up call,” she said.
‘Way too deep in one industry’
Some in the community have been working for years to recruit new industries.
“There were a lot of people who lived here who said, ‘Hey, we’re getting way too deep in our one industry,’” said Tom Stark, a vice president at Lake City Bank in nearby Goshen.
In part to address that concern, county leaders formed an Economic Development Corp. in 2000. A few years later, the community began work on the Horizon Project, an ambitious effort to expand educational opportunities in the county, deal with infrastructure problems and grow the county’s economic base.
But they hit roadblocks.
Stark, a member of the EDC board, said many businesses were reluctant to come to Elkhart County because the bustling RV industry kept the unemployment rate extremely low, making it hard to find workers.
For the same reason, some in the RV industry were unhappy with diversification efforts, said John Letherman, president of the Elkhart County Council.
“You bring in more companies, that just makes the labor pool that much smaller,” Letherman said.
Johnson, who headed the Horizon Project after selling his own rubber business, also said some companies were looking for a more highly skilled workforce than Elkhart had to offer. But over the years, many of the other companies that had once employed engineers, chemists and other highly skilled workers had left town, and the RV industry does not generally require those types of advanced skills.
Some workers are heading back to the classroom now. About 600 former RV workers have enrolled in retraining programs through the area’s Ivy Tech Community College, where overall enrollment is up. But efforts to educate a workforce can take years.
“Retraining’s a wonderful thing, but it’s not going to happen overnight,” Johnson said.
Reasons for optimism?
Despite the difficulties, community leaders see reasons to be optimistic. People at the EDC and the city of Elkhart say they are fielding hundreds of calls from people inquiring about doing business in the county. That’s thanks in part to President Barack Obama, who drew national attention to Elkhart’s plight in his three appearances there.
Still, with the rest of the nation also in recession, it’s tough to say when, or if, that attention will translate into new business and jobs. The county also is facing stiff competition from other communities hungry for new industry.
Boosters say Elkhart has several competitive edges. Where once potential businesses fretted about not finding enough workers in Elkhart, now the county can point to a willing workforce that is accustomed to hard, physical labor in the RV factories, which often pay according to production.
And they say Elkhart has a long history of entrepreneurship, pointing to the many businesses that have sprung up in recent years to supply the RV business. The community, they say, is a resilient one.
“We’ve been in a hole, but we’re trying to look up and see out of it,” said Dorinda Heiden-Guss, head of the county’s EDC.
Elkhart officials say their community could be a hub for other business, such as storage and distribution facilities. And many are hoping that a recent decision to locate a major nanotechnology research facility in nearby South Bend eventually will bring work to Elkhart.
Robert Dunn, managing director of that facility, the Midwest Institute for Nanoelectronics Discovery, said there is potential for work there to lead to manufacturing in Elkhart, but not for three to seven years.
Meanwhile, many small businesses that have supplied the RV industry also are seeking to diversify.
Promens’ Elkhart facility once did the bulk of its plastics processing for the RV industry. Now, the bulk of the work is for other industries. But Jack Welter, vice president of Roto North America, a division of Promens, said that is largely because the company closed two other factories elsewhere and shifted that work to the Elkhart facility.
“I don’t want to take too much credit on diversification,” he said.
When Kirk Veer started seeing business slip at American Stonecast Products, which supplies sinks to the RV industry, he tried to get retailers interested in his products. But Veer, who is president of the small company, said he quickly found he didn’t have enough of a product line to interest big stores.
Now, instead of pursuing business outside the RV industry, he’s hoping to stay afloat in part by adding lightweight countertops and tabletops to the roster of things he supplies to RV makers.
Many businesses interconnected
Another issue for communities tied primarily to one industry is that even other companies in town are often linked to the primary industry. Goshen Coach, a division of Thor Industries Inc. that makes small buses, is by some measures one of the bright spots in Elkhart’s struggling economy.
So far, the manufacturing facility has lost employees only through attrition, said Troy Snyder, Goshen Coach’s president. Executives hope federal stimulus money will help business, because local governments will have more money to buy vehicles.
But Goshen Coach relies on about 300 suppliers, including many in Elkhart County that also supply the RV industry. About a dozen of those suppliers have gone out of business because of the RV industry’s troubles, leaving the bus company to find new suppliers.
The company gets its chassis primarily from troubled U.S. carmakers GM and Ford. Because both of those companies are periodically shutting down their manufacturing lines to save money, Snyder said the company has been forced to keep more chassis on hand than it would like so it doesn’t get caught without the much-needed base for its buses.
On the plus side, many in the RV business say they are starting to feel hopeful that things won’t get worse. They talk of a good week here or there, and say the RV industry typically picks up in the spring and summer months.
“We think we’re at a point where we can ride it – we’ve hit bottom,” said Derald Bontrager, president and chief operating officer of the RV company Jayco Inc.