Forest City, Iowa-based Winnebago Industries Inc. announced today (June 29) the launch of a new 2012 RAVEN towable line as part of the company’s SunnyBrook brand.
According to a press release, the RAVEN is in full production and will initially be available in five fifth-wheel and three travel trailer floorplans.
“Dealer response to RAVEN has been outstanding,” said Fred Hershberger, national sales manager for Winnebago Industries Towables. “Every dealer has been impressed with the look that has been achieved and the price point that we’ve hit. Within the mid-profile fifth-wheel market, there will not be a more competitive brand.
He added, “Ron DeHaven, who is product manager for RAVEN, knows fifth-wheels and nailed this one.”
The newly designed RAVEN includes a high-end, gel coat fiberglass exterior, increased turning radius front cap, slam-latch baggage doors, storm door, glazed cherry cabinetry, designer furniture, 30-inch deep bedroom slideouts for increased floor space and flat “no step” floors in the bedroom. In addition, the RAVEN has been designed with a maximum height of 11-feet, 11-inches with standard wheels.
“I’ve managed numerous products over my 20-plus years in the RV industry and I can state that without a doubt this is the most exciting product that I’ve been associated with,” said DeHaven. “We are excited to sign new dealers and show retail customers a product that is focused on them.”
Admirers of all things RV can fill that particular thrill in Elkhart County, Ind., where more than 20 RV manufacturers offer factory tours.
Elkhart County is the recreational vehicle capital of the world with one of every two RVs being made in that county, according to amishcountry.org.
Fascinated by how things are made, I love factory tours, so I chose three for Best-Ever Friend Dave and me to visit. Dave owned a Winnebago 30 years ago so he was interested to see how things had changed.
First stop: Renegade RV, 52216 State Road 15 in Bristol, a 14-year-old company founded by Chuck McKibbin for the auto racing industry. Here, sales manager Danny Lagunas ushered us onto the factory floor where employees were working on several custom units. The smallest unit they build is about 32 feet, Danny said. Most of their vehicles are made for people who have owned several RVs and now want to design one to their own specifications.
We climbed up into these huge RVs to see the work in progress. We saw granite countertops, flat-screen TVs ready for installation — even one on the outside of the vehicle — granite floors, space-efficient layouts and unique storage solutions. Impressive!
Second stop: Jayco, 903 S. Main St. in Middlebury. You can’t miss Jayco because you’ll see hundreds of white travel-trailers in the factory lot.
But watch carefully for the Visitors Center sign. Inside the center, a renovated 1880s farmhouse, John MacDonald, marketing services manager, invited us to look around the center or to go outside and look at the vehicles on display while we waited for our noon tour. We did both.
A video told us about founders Lloyd and Bertha Bontrager, who started the company in a chicken coop in 1968. They quickly outgrew that and are now the largest privately owned RV manufacturer.
Judy Swihart, visitors center coordinator, took us in a trolley back to the building where they make about 11 fifth-wheels per day.
Then we went to the cavernous and fascinating sewing room. We watched a machine quilting two yards of material every 45 seconds. The material is used for bedspreads and pillow shams.
We watched as employee Deb Lafary filled a pillow cover with a foam cushion. If you’ve done that, you know it can be challenging. But not at Jayco.
Deb placed the foam cushion on a vacuum machine, covered it with plastic, turned the machine on and, instantly, it shrank. She popped it inside the covering and, in a nano-second, it re-inflated and filled the covering.
After Jayco, we had lunch at Village Inn, 107 S. Main St. in Middlebury. This is where locals gather to talk about the weather, a hot topic this winter. So we chose comfort food: cups of sweet, tomatoey chili; creamy and tender chicken and noodles; and homemade pie for dessert, pecan for me, cherry for Dave.
Our final stop was SunnyBrook RV, 201 14th St., Middlebury, which just last December became Winnebago of Indiana LLC. Jeff Baker, sales representative, took us and a group of insurance agents on the tour, explaining the manufacturing process from the naked chassis stage to the finished product, whether a fifth-wheel or a travel-trailer.
With the insurance agents asking questions, Jeff told us all the things RV manufacturers do to avoid problems for the consumers. We learned about glues, insulation, windows, awnings and the craftsmanship.
Most impressive for me was the outdoor kitchen on one of the vehicles. You pop up the cover to find a tiny sink, refrigerator and stove.
This day of “RVs Unwrapped” is a great way to learn about RVs before purchasing one or just to be impressed with manufacturing innovations. It also answered my ever-present question: “How do they do that?”
Editor’s Note: Robert W. Baird & Co. issued a client newsletter after this week’s release of the August towable sales figures by Statistical Surveys Inc. (SSI). Excerpts from the Baird Newsletter follow.
U.S. towable registrations increased 11% in August. Dealer sales of towable units increased for the sixth consecutive month in August. Total U.S. towable retail increased 11% (travel trailers up 11%; fifth-wheels up 11%) compared to an 8% drop in motorhomes. Looking to the remainder of 2010, we expect approximately 10-15% retail growth in towables, with Thor taking share.
Towable retail up 11%. Towable demand improved in August. Travel trailer registrations grew 11% while fifth-wheel demand also increased 11%. Towable sales outpaced motorhome sales which fell 8% in August.
Leaders gaining share. Thor continues to take share with retail registrations up 16% in the month. We also note that Heartland RV (No.4 market share and recently acquired by Thor [THO-$31.52-Outperform]) saw registrations increase 41%. Altogether the top five manufacturers have seen retail grow 20% YTD versus 8% YTD industry growth.
Inventory. Dealers have increased towable inventory in 2010 as towable shipments have exceeded retail sales. We believe that dealer inventory is fairly balanced at current levels and future shipments should track in line with retail demand.
Retail SAAR. We calculate a seasonally adjusted rate of retail (SAAR) registrations. The SAAR of towable demand increased to 159.K units in August from 153.6K units in July.
Recent news. Winnebago (WGO-$9.74-Outperform) indicated today (Oct. 18) that it is looking to acquire SunnyBrook RV, the No. 13 player in towables with 1% share.
To subscribe to this or other Baird publications, contact Craig R. Kennison, CFA, at firstname.lastname@example.org or (414) 765-3870.
Winnebago Industries Inc. today (Oct. 18) reported the company has signed a letter of intent indicating its interest in acquiring SunnyBrook Manufacturing Inc., Middlebury, Ind.
Upon execution of this letter of intent, Forest City, Iowa-based Winnebago began a due diligence process that will result in a formal assessment of SunnyBrook Manufacturing and a final decision on proceeding with the acquisition, according to a news release.
This would be Winnebago’s first re-entry into towable production since it became strictly a motorized manufacturer more than 40 years ago.
The company anticipates the due diligence process to be completed such that the acquisition would be finalized by the end of the calendar year. A more thorough statement will be made at that time regarding the complete scope of this potential acquisition.
“We began our journey to access potential diversification efforts last year with the announcement on Nov. 4, 2009, that we had created a new position for strategic planning, and as part of that new assignment, Randy Potts, our senior vice president of strategic planning, was tasked with investigating potential diversification strategies,” said Winnebago Industries’ Chariman, CEO and President Bob Olsen. “This potential acquisition would mark the first action the company has taken on this front.”
Winnebago had no additional comments on the announcement.
Today’s announcement confirms comments Winnebago made last week about its interest in acquiring a towable manufacturer.
In a conference call with analysts following release of its financial results for the fourth quarter and fiscal 2010, Olson said essentially what he has said before in terms of acquisitions.
But he said it, perhaps, with a bit more immediacy this time around: That the company would consider “anything that makes sense” in terms of a growth strategy amid a relatively soft U.S. motorized market.
In fact, Olson, responding to a question about whether Winnebago had been reexamining its acquisitions strategy recently — specifically regarding towables — indicated an announcement might be forthcoming “hopefully soon” regarding an acquisition.
He declined to give details.
“We continue to look at that,” Olson said. “We’re not ready to announce anything but I can tell you we are looking at some things really seriously right now and I’m hoping within a short period of time there might be something that we can discuss.”
SunnyBrook was established in 1992 and the first trailer, a 26 FP travel trailer, rolled off the line on March 22 of that year from the company’s 14,000-square-foot plant. It was founded by Elvie Frey Sr., Tommy Thornton, Susan Kalb Yoder and David Fought.
The company expanded quickly in the 1990s and today has more than 200,000 square feet of manufacturing space.
According to the latest Statistical Surveys Inc. (SSI) report, SunnyBrook RV ranked 13th in travel trailer and fifth-wheel production, having sold 982 units for 0.9% of the market through August 2010. Its annual sales were reportedly less than $35 million in 2009.
Its Middlebury facilities include two production lines making travel trailers, fifth-wheels and toy haulers. SunnyBrook had more than 250 employees before undergoing several cutbacks in 2008.
The company is run by Frey, who is chairman and CEO. He formerly worked at Starcraft RV, before leaving there to form SunnyBrook.
Some RV manufacturers say the pressure on the industry’s transportation channels continues to build and that backlogs of up to six weeks in delivering RVs from factories to dealers are common. But others claim the transportation situation is easing up.
Jayco Inc., Middlebury, Ind., and Gulf Stream Coach Inc., Nappanee, Ind., are facing up to six-week waits. “The situation has eased up to some extent, but it is still a tight situation,” said Sid Johnson, Jayco’s director of marketing.
As for dealers and customers, adds Johnson, they’ve been relatively patient thus far.
“As we are now into spring and better weather, there is going to be increasing pressure on trying to get the product to the dealership when needed,” he said. “There is absolutely no doubt that the pressure will increase between now and the first of June unless we can provide a more timely service for them.”
In addition to a four-to-six-week shipping backlog, said Phil Savari, executive vice president at Gulf Stream, the market is such that has company is facing a four-to-six-week backlog on manufacturing their towable RVs.
The upside to all of this: Business is good.
“It is the best backlog we’ve had at our company,” he said. “But we are feeling the heat from dealers and customers. Looking at the seasonality of this industry, most of the manufacturing and shipping is happening between January and April. That is when the dealers/manufacturers/suppliers/transport companies gear up.”
Savari would prefer a market that wasn’t so seasonal, but realizes that this is the way things have always been. “What we are experiencing is a good sign right now because the demand is up and I believe more finance companies are going to be loosening up,” he added. “This is the great U.S.A. and people are going to feel confident again.”
Lazydays RV SuperCenter, Seffner, Fla., is also experiencing a backlog in the delivery of towables. “Lazydays has been able to minimize that impact by having a strong relationship with the drive services and even sending our own drivers when needed in order to best serve our customers,” said Sharon Padly, inventory manager.
However, the situation at SunnyBrook RV, Middlebury, Ind., is more fluid.
“Star Fleet is our primary carrier and the most we are out is one week,” said Elvie Fry, president. “Star Fleet is our carrier of choice so that helps. They do take good care of us, plus we are not shipping the higher number of units that some of the other larger companies are. We are shipping an average of 150 towable RV’s a month.”
From a carrier standpoint, Wave Express, Goshen, Ind., earlier this year had a three-week backlog — not as long as some other transport companies, but still more than part-owner Anita Carpenter would prefer. But she says the backlog has now decreased to two weeks.
Honestly it seems it is easing up a little bit,” she said. “Part of that reason is we hired more drivers. We’re still busy. There is plenty of work, but our dispatchers aren’t wanting to pull their hair out. Considering where we were two years ago it is amazing how busy we are.”
Wave Express is shipping 100-125 towables weekly in the U.S. and Canada.
RV Transport Service in Portland, Ore., is only three days backlogged for U.S. deliveries, about a week for Canadian deliveries.
“We’re hiring about one driver a week,” said Leah Dilgarde, general manager. “Our key to not getting backlogged is only accepting the work that we know will be covered in a timely manner. I have turned down work when we don’t have the drivers available, which is probably different from other companies because they’ll take every load they can get, even if they don’t have the drivers available.”