Friday, April 18, 2008



RV Business
Thursday, April 17, 2008

Reportedly strapped for cash and struggling in a down market, longtime recreational vehicle manufacturer Western RV, Union Gap, Wash., shut down Tuesday (April 15), giving workers little hope for future employment with the company.

According to the Yakima Herald-Republic, the longtime company said in a news release that its operations have been temporarily suspended due to a market slowdown.

"During this short break in manufacturing, Western RV will review our alternatives and determine the best course of action going forward," company President Bob Wert said in the statement. "Once a plan has been developed or a suitable buyer for the business is identified, we intend to resume normal manufacturing operations."

Production workers were informed Tuesday not to return to work and salaried employees were let go later in the day, reportedly told it would be best for them to look for work elsewhere.

About 220 employees are affected by the closure. The firm, which makes high-end motorhomes, fifth-wheel trailers and truck campers, laid off 47 workers last month in a move company officials said was to align production with market demand.

The Herald-Republic reported that the firm's owner, Monomoy Capital Partners of New York City, did not return messages for comment. A receptionist said the equity firm's partners were at an annual meeting and not in the office.

Monomoy bought the 37-year-old company, founded by Bill and Suzanne Doyle, in late 2006. The firm made an unsuccessful attempt last fall to merge the firm with Middlebury, Ind.-based towable builder Pilgrim International Inc.

The company's human resources director, contacted by phone at her office Wednesday, said she could not provide any information to clarify the situation.

Salaried employees weren't paid on schedule Tuesday, said one employee who asked not to be identified. Payday for production workers is today, but it's unclear whether they'll receive any checks.

"Those are 220 people who won't be buying the newspaper or getting a haircut," the employee said of the layoffs. "The ripple effect is pretty substantial."

According to the The Herald-Republic, the company shutdown is emblematic of tough times in the RV industry nationwide. As housing values have dropped, many potential buyers have lost the equity in their homes they had in the past to purchase big-ticket items.

A quiet atmosphere hovered over the plant on Wednesday. Some employees were inside, but the doors were locked and customers – some needing work done on their RVs and others wanting to pick up parts – were turned away.

Beau Durkee, a salaried employee who headed sales for the company's camper division, told a reporter the company might be looking to sell. He was carrying out a box of his personal items to his truck.

"There's still a lot that's up in the air," he said. "It has not gone into bankruptcy. It's just shut down."

While Durkee said he believed the plant would reopen, he couldn't say when.

"There are a lot of things that could happen in a week and there are folks working on it right now," he said without elaborating.

One production worker who showed up late Wednesday morning to find out about his pay said the shutdown was sudden. Like others, he declined to provide his name or any details per the company's request.

Dave McFadden, president of the Yakima County Development Association, said the RV industry has struggled with economic uncertainty. He said he was not informed of the company's plans.

Kevin Broom, a spokesman for the Recreational Vehicle Industry Association (RVIA, said overall economic conditions have been the biggest challenge for manufacturers.

The slowdown comes on the heels of five consecutive years of growth, culminating in historic sales of 390,500 units in 2006.

But in a sluggish economy, a recreational vehicle can be daunting for price-conscious consumers.

According to the Herald-Republic, Western RV motorhomes can cost $250,000 to $500,000 each. The Alpine Coach Limited SE, for example, costs at least $300,000 for a motor home that is 34 to 40 feet long and includes features such as an entertainment system with satellite television and a DVD player, cherry cabinets and leather furniture.

"An RV is a discretionary purchase. When consumer confidence stops, they postpone discretionary purchases. We see heavy traffic at (RV) shows and a lot of interest in RVing," Broom said, noting consumers are still showing interest. But, he added, "People are postponing the purchase because they want to see what will happen."

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