The ongoing move of Utilimaster Corp. from Wakarusa, Ind., to nearby Bristol dragged down earnings of parent company Spartan Motors Inc. for the first quarter of 2013. But, according to a report by the Elkhart Truth, the company expects the move to pay off in the long run and is expanding Utilimaster’s product offerings.
“We completed the move of Utilimaster’s walk-in van business from Wakarusa to Bristol,” during the quarter, wrote John Sztykiel, president and chief executive of Spartan. “Our high-volume line is now running at expected rates. Now we are adding the lower-volume, mixed-model line, which should ramp up to expected rates during the second quarter. We are excited to see more than 12 months of hard work come to fruition in the form of a high-quality product coming off the line, 100% complete,” he wrote in the company’s quarterly results announcement May 8.
Company revenues were down 19.1% from the same quarter last year and the company posted a net loss of 13 cents per share, much of that attributed to the Utilimaster move.
John Forbes, Utilimaster president, said production in Bristol started in mid-February, moving from a “sprawling, 16-building campus with a 2 1/2-mile-long production line and outdoor inventory storage to one, efficient, self-contained facility.”
The company has figured out better ways to produce vehicles, an effort it expects to save $4 million a year when all is said and done. “The Bristol project represents a shift in culture as well as production methods and location,” Forbes said in the company announcement.
To read the entire article click here.
Utilimaster Corp., a subsidiary of Spartan Motors Inc., today announced an alliance with LandiRenzo to offer compressed natural gas (CNG) conversions on Isuzu NPR-HD Gas vehicles. LandiRenzo is a world leader in alternative fuel solutions with over 1.5 million systems sold annually. Utilimaster has been providing alternative fuel solutions including LPG, CNG and plug-in electric since 2003.
According to a press release, the CNG conversion provides current fuel costs savings up to 65% when compared to conventional gasoline (saving the equivalent of $1.50-$2.50 per gallon). Compressed natural gas offers up to a 75% reduction in NOx of and a 25% reduction in carbon dioxide (CO2) greenhouse gases.
Utilimaster President John Forbes noted, “With the rise in fuel prices, Utilimaster is offering fleet owners a green solution with field-proven financial returns. We are unique to offer the solution at our OEM assembly plant and offer in-field, on-site installations. Our clients know they have a business alliance they can trust at a time when increasing costs make Compressed Natural Gas an attractive alternative.”
Utilimaster, which recently moved operations from Wakarusa, Ind., to nearby Bristol, also announced a preferred installer agreement with BAF Technologies. Together, Utilimaster and BAF will be presenting a converted vehicle in the Ford Commercial Truck booth at the 2013 NTEA Work Truck Show currently under way in Indianapolis.
Under the agreement, Utilimaster, a market leader in delivery and service vehicles, is appointed the exclusive and preferred installer of the BAF compressed natural gas system on the Ford F-59 walk-in van stripped chassis. The solution achieved both EPA and CARB certifications.
Just days after Forest River Inc. inked a deal to buy the sprawling Utilimaster Corp. campus on Wakarusa’s east side, Forest River subsidiary Prime Time Manufacturing is already building RVs at the site.
“We’re already into production,” said Jeff Rank, president of Prime Time. “We started moving stuff at the end of the year in preparation.”
The Elkhart Truth reported that the sale, announced last week by Utilimaster, brought some certainty back to the town. When Utilimaster announced 11 months ago that they were moving to Bristol, “that came out of the blue,” said Jeff Troxel, Wakarusa town manager who was a member of the town council at that point.
With the Forest River purchase now finished, “I’m excited about it,” said Troxel. He knew Prime Time was outgrowing its space just down the road from the Utilimaster campus. “I didn’t want to lose Prime Time,” he said.
“Hopefully Forest River uses the facility to its utmost potential,” Troxel said.
Pete Liegl, president and CEO of Elkhart-based Forest River, said, “We wanted to stay in that community with Prime Time because Prime Time has done so well and Jeff Rank has done an excellent job down there.”
In an interview with RVBUSINESS.com, Rank reported much of the production that Prime Time has moved into the former Utilimaster plant since the holidays, including Crusader and Sanibel towable production, was located until the end of the year at the former Hart Housing Group facilities in Wakarusa, recently sold by Forest River to Maryville, Tenn.-based Clayton Homes, a sister division with Forest River of Berkshire Hathaway Inc. according to Rank.
Rank says the Hart Housing sale was structured such that Prime Time’s operations could stay in that Hart Housing facility until the end of the year. So, Prime Time moved over the holidays — the end result being that Prime Time today is located in the original plant it has occupied on the south side of Wakarusa — the former Travel Supreme plant — in addition to part of the Utilimaster complex that Spartan’s Utilimaster commercial truck unit is vacating, a total of 325,000 square feet of production space for 400-employee Prime Time.
Rank says things are going well with the move, noting, “Oh, it’s fantastic. I mean, quite frankly, Prime Time loves being in Wakarusa. I mean, the town’s been good to us. So we were thankful as we were moving out of Clayton that Forest River was able to do this because we wanted to stay in Wakarusa, and obviously it’s good for the community that the jobs we have at Prime Time are staying in Wakarusa. On top of that, there’s a lot of buildings and a lot of land over there that Forest River has bought that could play into future expansions and give us additional opportunities to grow and extend our operations.
“You know, we’re going to continue growing. Prime Time grew 40-some percent last year in market share and we’re off to a great start again this year, and we’ve got several products that are actually being built in that same plant. As those products mature and get more volume, we’re going to need additional facilities for them as well. So, it would only be my hope that we could continue to grow there (in the Wakarusa area), but that’s a long time away. This deal just recently went down, and I can’t actually tell you that we’ve (Forest River) sat down as a group and talked about it.”
To read the entire Elkhart Truth article click here.
More flexibility, leaner manufacturing and hopefully more jobs. That’s what Utilimaster Corp. is looking to gain this year as it moves into its new Bristol, Ind., facility.
“It’s a strong commitment to our future. We’re laying out our facility in a more efficient fashion. We have a facility that will be in a condition that easily could last us another 20, 30 years, probably even beyond that,” said John Forbes, Utilimaster president.
According to a report in The Elkhart Truth, the move was announced last year and won’t be finished for months, but work has been under way.
Shelving and equipment are starting to fill the cavernous building on Earthway Boulevard, and workers are testing new assembly processes. When the move is completed in the second quarter, “It will allow us to be more connected,” Forbes said. “Even when you’re in 15 different buildings on a different campus, you have a lack of connectivity. There’s nothing like face-to-face and eyeball-to-eyeball. Even when you have mail and phones from one end of the campus to the other, it doesn’t have the same level of connection.”
To read the entire article click here.
The year started out with a blow to Wakarusa, Ind., with Utilimaster Corp. announcing a move to Bristol. But, according to a report in the Elkhart Truth, 2013 may make up for it with another company anonymously thinking about taking over the full complex.
Spartan Motors Inc., parent company of Utilimaster, announced in February that the company will move to Bristol, vacating the Wakarusa complex which includes 16 buildings and covers 106 acres. That move is expected to be complete in late spring or early summer.
Brent Miller, the FM Stone agent handling the property, said there’s a promising prospect for the property. “We’re working on a deal right now with a company that we’re hoping is going to take the whole complex,” Miller said.
To read the entire story click here.
At first glance, the delivery vans undergoing final body assembly do not appear different from any other vehicle that Utilimaster Corp. has produced. But look closer. On the production line, the hoods are missing from the front and the space where the diesel engine would sit is empty.
As reported by the Elkhart Truth, these are the new all-electric walk-in vans that Utilimaster, based in Wakarusa, Ind., and Smith Electric Vehicles, headquartered in Kansas City, Mo., have designed especially for the FedEx delivery fleet. Smith manufactures the chassis and power train, Utilimaster builds the body and A123 Systems, with corporate offices in Waltham, Mass., produces the lithium ion batteries.
During the first week of July, Utilimaster production crews were working to fulfill the order for 27 all-electric vans and expected to be finished in two days. Twenty five of the vehicles will be outfitted with a coat of crisp white paint and FedEx logos.
To read the entire article in the Elkhart Truth click here.
Production of the new environmentally-friendly Reach delivery van has started to migrate from the Utilimaster Corp. plant in Wakarusa, Ind., to the Spartan Motors Inc. campus in Charlotte, Mich., according to a report by the Elkhart Truth.
Although the manufacturing schedule was delayed by three months, the vans are being built. Spartan, parent company of Utilimaster, is expecting to ship a total of 500 to 1,000 Reach vehicles in 2012 and anticipates production will nearly double in 2013.
As part of the original Reach launch plan, the assembly line will shift north from Indiana to the Spartan headquarters which will put the body assembly closer to the Isuzu diesel chassis operation.
Despite losing the new van, Utilimaster has a backlog of orders and is growing its payroll. To date, about 80 new production workers have been hired and the company is looking to add another 150 by the end of August. The manufacturer has a current workforce of 839.
To read the entire story in the Elkhart Truth click here.
John Forbes, president of Utilimaster Corp., is optimistic May will be a good month for his company.
“All will come together in May,” he said.
Even though it is just seven days old, the month has already produced some highlights for the Indiana-based truck body manufacturer. Earnings results released May 1 show sales at the company boomed during the first quarter and the Bristol Town Council gave preliminary approval May 4 to an incentive package that will help Utilimaster with its move from Wakarusa to Bristol.
To read the entire article in the Elkhart Truth click here.
Spartan Motor’s Inc. announcement Tuesday (Feb. 14) that it was relocating operations for its Utilimaster Corp. subsidiary proved to be a wash as far as the overall employment picture in Indiana’s Elkhart County because no jobs are ultimately being shifted out of the northern Indiana county. But for two small communities it was pivotal news, as Bristol’s fortunes rose and Wakarusa’s sunk quickly.
As reported by the Goshen News, John Forbes, president of custom vehicle manufacturer Utilimaster, announced the company would be moving from Wakarusa to Bristol, taking 600 full-time jobs and 200 temporary jobs with it.
Standing inside the massive former Odyssey Group building in the Earthway Rail Park on Bristol’s southwest edge, Utilimaster President Forbes stood in front of a knot of TV cameras and reporters and said the decision was based on creating an efficient workplace.
“This facility is 425,000 square feet,” he said. “It is a clean, newer facility than our current campus and it gives us a great opportunity to grow out business, support our customers and support our team members for years to come.”
“We are very excited about the opportunity to grow our business,” he continued. “Last year we enjoyed 46% sales growth and that allows us to be in a position to invest in the future of our business.”
The news of the move was broken to Wakarusa town officials at 7:30 a.m. Tuesday. In a town that saw more than a thousand jobs swept away by the recession when Monaco Coach folded in 2008, it was another “Oh, no,” moment.
“We weren’t ready for that. It was kind of a shock,” said Jeff Troxel, Wakarusa Town Council member.
The silver lining in the announcement is that the current work force will remain intact and be able to move with the plant if workers want to make the drive north.
According to the Goshen News, just hours after the surprise announcement, Troxel said he was trying to stay optimistic as he watches another long-time local company leave his small town. He said the Elkhart County Economic Development Corp. will be working to market the Utilimaster complex, which consists of 106 acres containing 16 aging buildings.
“We are resilient,” Troxel said. “We will get through this. It’s a neat town and it is a great place for business to come. I am looking forward to moving forward and having some businesses come to our location.”
The condition and size of the Utilimaster complex is one of the reasons Forbes said the company needed to move. The Odyssey building is large, but at 425,000 square feet is smaller than the 760,000-square-feet of space under roofs at the Utilimaster location.
Forbes said he expects there will be many efficiencies that stem from the move, especially in the movement of parts and vehicles under construction, which will have a much shorter assembly line. Utilimaster vehicles now travel 2 1/2 miles during the assembly process, and Forbes said that distance will be reduced to about a half-mile.
“Today in Wakarusa we have 16 different facilities,” Forbes said. “So our product flows from building to building, not in the most efficient fashion. Putting our operations under one roof gives us a great opportunity to do things in a higher quality environment a safer environment and a more efficient environment.”
The process for the move began when Spartan Motors acquired Utilimaster in 2009, according to Forbes. He said planning began to make the company more efficient and profitable, which meant a new facility was needed. He said company officials looked at sites in Michigan, Indiana and in the South, but decided to stay in Elkhart County.
Asked what the determining factor was, he said it was the ability to keep the company’s production team intact.
But the key to making all the changes happen, Forbes said, is a package of incentives the company is asking for from state and local entities, including the Bristol Town Council.
David Ogle, president of the Economic Development Corp. of Elkhart County, outlined the plans with the Bristol council, which met in an informal work session Tuesday night.
Ogle said Utilimaster wants to stay in Indiana and stay in Elkhart County, although the company looked at other states before deciding on the relocation.
“We think we are competitive. We feel for Wakarusa, but it is nothing they did. It is an efficiency thing,” Ogle said.
The company will seek state and local incentives such as tax abatements and Tax Incremental Financing as it moves the operation to Bristol. The town now has two TIF districts, and may be asked to approve a third one.
Ogle said state officials are expected to act quickly on the request for aid. He said the state may be in a position to make an offer to the company within 10 days.
“We are willing to go that extra mile,” said Bristol Town Council president Floyd Lynch said Tuesday night.
“Just keep us in the loop,” he told Ogle.
The town council will hold a meeting Thursday, then another work session March 13 and regular meeting March 15.
In a conference call Tuesday (Feb. 14) following Spartan Motor Inc.’s fourth-quarter and year-end financial report, CEO and President John Sztykiel elaborated on the company’s announcement that it would be moving operations for its Utilimaster Corp. subsidiary from Wakarusa, Ind., to nearby Bristol.
According to a transcript from the earnings call (to read the entire transcript click here), the relocation would include motorhome chassis manufacturing that was to be transferred from Charlotte, Mich., to the Utilimaster facility in 2012. He also said that production of the Reach van, a commercial vehicle currently being built in Wakarusa, would be moved to Charlotte as previously announced in 2011.
Sztykiel stated: “From an RV perspective, one of the benefits of Bristol as well is we’ve talked about moving the RV business down to Bristol, or I should say down to Northern Indiana. All the RV chassis will be built in the Bristol facility. So we’ll now be within minutes of the RV marketplace, thus improving our competitive position in a substantial way.”
RVBUSINESS.com also learned that Utilimaster will be moving into a vacant facility formerly occupied by industry supplier Odyssey Group. Odyssey began liquidating inventory in January 2009 following reports that the company was closing the Bristol plant.
Below are Sztykiel comments regarding the Utilimaster move.
“Let’s talk a few minutes about Utilimaster Bristol consolidation, of which there is a separate release on that today, an extremely exciting event. In earlier calls, Joe and I have had business with each one of you and at times you’ve all complemented us on the improvement of Utilimaster. We’ve all said that there is still much more improvement yet to be had, as there is tremendous opportunity.
Earlier today, we announced the third step in our strategic plan to meet these goals. The first step was to improve operations and profitability in the existing Wakarusa facility, a tact that we’ve accomplished and Joe is going to get into some of that detail. The second step was to bring the Reach van product to market. That was accomplished.
The third step was to look or develop the right facility operational map, and that is now in Bristol, Indiana. To give you some idea into this goal for the product and what it means, we signed a lease with Fruit Hills Investments today on the Bristol facility that will allow us to move from a sprawling 16-building campus, which is over 700,000 square feet into a more modern and efficient one-building under one roof that is about 13 years old and has about 425,000 square feet.
What’s interesting is in Wakarusa, most of the buildings are more than 40 years old with the newest being 30 years old. And to give you just a little bit of perspective, if you ever went there and you just washed your car and you drove around the facility, visiting the different buildings and again 16 buildings, so when you think about the added indirect cost, the overhead, the operating expense, the inefficiencies et cetera, when you would come out of there with a really dirty car, and then you’d walk away and say, this is absolute madness, trying to build products within 16 buildings with the average age of 30 to 40 years old.
As the release noted and please take time to look at the release, we’ll be reducing the non-value added process in material handling by over 80%. When you take a look at the length of line for a walk-in during the travel, it’ll be going from 2.5 miles to less than 0.5 mile. It’s huge simplification in the assembly process, also the ability to deliver a higher-quality product.
Third, the assembly lines in the new Bristol facility will be much more flexible. They will allow changes in the layout and equipment rather easily. It’s our expectation that the new plan will not have any permanent fixtures in place that dictate how the assembly lines must be laid out.
What’s interesting about the facility is when I first went in there, I didn’t see very many columns and whoever built the building was extremely intelligent 13 years ago, because they have very few columns, very, very high ceilings, very strong support. So from a facility’s perspective, it is ideal from a manufacturing point of view. And when I spoke about where we came from to where we’re going, we’re going from 106 acres to 26 acres.
The reality is facility’s operations is no different than your house. If you have a large house, over time you’re just going to buy a lot of stuff and you’re probably not going to use it and you’re going to accumulate it. You’re not going to manage a personal sheet and cash very, very well. The same is true in a business. You go from 106 acres to 26 acres. I have no doubt our inventory turns will go up, our inventory will come down and we will see significant cash balance sheet improvement in the new Bristol facility. Why? Because you just have less space. So as we look forward, we’re extremely excited.
Fourth, the working process from one plant to another, and as mentioned in the release, these changes should result in annual cost saving reductions of $4 million a year at a minimum. So when you look at Utilimaster and you’ve heard Joe and I talk over the last 12 months while you’ve complemented us on the rate of improvement, et cetera, this is the third step of the plan. And we have several steps yet to execute, but in 2012, we will be very focused on bringing horizon on line to ensure that we see the operational benefits late in the second half and throughout all of 2013.
From an RV perspective, one of the benefits of Bristol as well is we’ve talked about moving the RV business down to Bristol, Indiana, or I should say down to Northern Indiana. All the RV chassis will be built in the Bristol facility. So we’ll now be within minutes of the RV marketplace, thus improving our competitive position in a substantial way.
At the same time, just to reiterate, when that happens, we will be moving the Reach van production from Indiana up to the Charlotte campus. So from an Isuzu partnership perspective, everything with and around Isuzu will be located in Charlotte, Mich.”