Friday, January 02, 2009
MORE FLEETWOOD NEWS
Tuesday, December 30, 2008
The NYSE will suspend trading on shares of recreational vehicle and manufactured housing builder Fleetwood Enterprises Inc. on Jan. 5 after notifying the company that it is not in compliance with the continued listing standard.
According to a press release, NYSE requires a minimum average market capitalization of not less than $25 million over a consecutive 30-trading-day period. Fleetwood's stock ended Monday's trading at 11 cents per share.
Fleetwood said it is making the necessary arrangements to ensure that its common stock continues to trade through normal brokerage channels on one of the regular over-the-counter markets.
The delisting from the NYSE does not constitute a default under the Riverside, Calif.-based company's lending arrangements and will not change Fleetwood’s filing of periodic and other reports with the Securities and Exchange Commission (SEC).
Separately, Fleetwood management restated its commitment to the next phase of an aggressive restructuring program, which is designed to return the company to at least break-even cash flow early in the next fiscal year.
The company said it plans to further streamline non-critical corporate functions, centralize certain other administrative tasks to drive efficiencies and cost savings, and strengthen operating margins through improved labor efficiencies, materials management, and improved utilization of capacity.
“While we continue to push customer-facing functions, including product development, as close to the customer as possible, we are centralizing or outsourcing many administrative functions,” said Elden L. Smith, president and CEO. “This is not only cost-effective but also strongly enhances our governance, compliance, and risk-management responsibilities. These changes, once implemented, will result in a leaner, more efficient organization, and we will be well positioned to capture pockets of growth in any of the markets in which we operate."
Fleetwood said it will also continue to closely target the most profitable products or market segments within each of its businesses.
In addition, Fleetwood intends to join forces with its dealers in the area of their greatest need by leveraging relationships with national and local retail and floorplan lenders across the country and in all its business lines, to try to assist customers through the current crisis in the credit markets.
"Fleetwood's market position, products, and organization stand out from its competitors in both RVs and housing," said Elden L. Smith, president and CEO, "and we intend to leverage off our strengths. In the current environment, with tight lending and narrow profit margins, dealers and lenders need to partner with manufacturers who offer more than just a cost-competitive product.
“Thus, we intend to build on our size and national reputation by dedicating resources to help our dealers access needed financing, which we are already doing in RVs through Fleetwood Financial Services, and by continuing to provide quality products and service that leads both of our industries.
COUNTRY COACH IS TRYING TO SURVIVE
Thursday, January 1, 2009
The head of Junction City, Ore.-based Country Coach Inc. has notified employees that it will shut down for good in two months if it can’t obtain new financing, according to a report in the Register Guard, Eugene.
“Looking forward, due to recent and unexpected circumstances beyond the control of Country Coach, it now appears that Country Coach will be forced to permanently shut down unless it obtains additional financing on or before Feb. 28, 2009,” CEO Jay Howard said in a letter to employees, dated Dec. 30 and obtained Wednesday by the Register-Guard.
Even if the company is able to obtain a loan, the company expects “mass layoffs” starting around March 1, Howard said.
Country Coach, like other RV makers, has been hammered by brutal market conditions this past year. The privately held company has already laid off hundreds of employees in a series of job cuts in 2008.
Company spokesman Matt Howard said the company currently has about 500 employees. As recently as June 2006, the company said it had 1,700 workers and was planning to hire 200 more to help build two new models of motor coaches.
Matt Howard said he couldn’t speculate on the likelihood of the company’s ability to obtain loans that would permit it to stay in business.
“We’re spending every effort right now trying to resolve that,” he said Wednesday. “All our emphasis lies in making sure Country Coach stays open and viable.”
The letter was sent to employees as “a worst case scenario” and to fulfill a legal requirement under the federal Worker Adjustment and Retraining Notification Act. The WARN Act requires employers to give employees and communities 60 days notice in advance of plant closings and mass layoffs.
“These are the worst economic times any of us have ever seen in this business,” Matt Howard said.
Historically, the company has furloughed workers for two weeks in December, but this year Country Coach extended its shutdown for the entire month of December because of the tough economic times.
The Register-Guard reported that the company had planned to reopen next Monday. That won’t happen, Matt Howard said.
In his letter to employees, Jay Howard outlined the problems confronting the company:
In August, the company sought financing, but the funding it received in October was less than initially requested, he wrote. He doesn’t specify the numbers, and Matt Howard said he did not have authority to discuss the financing.
But in September, the company issued a news release saying it had obtained a $6 million capital infusion from investors, and SEC filings showed that it sold $10.9 million in subordinated secured promissory notes to 11 investors earlier in the year.
Jay Howard said RV sales were hurt by the high gas prices last summer, and then by a nationwide credit crunch. Then in November, GE Capital, the primary lender for Country Coach dealers, announced that it would not finance RV purchases at least through the end of 2008, he said.
“GE’s surprising decision to stop funding Country Coach’s dealers effectively stopped the demand for motor homes,” Howard wrote.
As a result, several Country Coach dealers closed, which “triggered massive repurchase obligations for Country Coach while decreasing the demand for motor homes even further,” he wrote.
If the company cannot obtain financing, the plant will not reopen and will close permanently sometime between Feb. 28 and March 14, he wrote. Even if financing is obtained, Country Coach anticipates “mass layoffs” starting on or about March 1.
“While Country Coach would have preferred to provide earlier notice of the mass layoffs and potential shutdown, to do so would have undermined its efforts to obtain financing to preserve its business,” Howard wrote.
Country Coach, originally known as Country Camper, was founded in 1973 by Bob Lee, a former aerospace worker who was one of the original partners in Monaco Coach Corp. Over time, the company developed a market niche of building higher end, bus-like RVs that today range in price from $300,000 to more than $1 million.
Lee sold the company in 1996 to National RV Holdings Inc., a publicly traded RV maker in Perris, Calif., that paid $9 million for the company and assumed $10.1 million in debt.
After National RV got into financial trouble, Lee was among the partners, led by Los Angeles investment banker Bryant Riley, who bought Country Coach back from National RV. in February 2007 for $38.75 million in cash and the assumption of $13 million in debt. The new ownership took the company private.
Signs of trouble at Country Coach began to emerge late last year. In December 2007, the company imposed the first in a series of job cuts, laying off about 200 workers. More layoffs came in March. And in April, the company imposed a 5% pay cut on all employees, and Jay Howard said he was trimming his own pay by 25%.
In December, the company elected not to attend the biggest RV trade show of the year in Louisville, Ky., even though it had developed what observers said was the biggest innovation the industry had seen in years: an RV with a retractable deck.
Wednesday, December 31, 2008
FOREST RIVER/COACHMAN DEAL FINAL
Monday, December 29, 2008
Coachmen Industries Inc. announced that it finalized the sale of nearly all of the assets from its RV business to Elkhart, Ind.-based Forest River Inc. on Dec. 26.
The sale had been overwhelmingly approved by the company's shareholders the previous week.
“While the housing markets remain under intense pressure, Coachmen Industries Inc. has substantially strengthened the financial stability of our company with the completion of the sale of our RV group," said Rick Lavers, CEO of Coachmen. "Our company is restructured as a systems-built housing company with a growing specialty vehicle business. Our headquarters will remain in Elkhart County."
Coachmen reported that of the $42 million purchase price, $10 million will be put into an escrow fund to pay for warranty claims. Another $11 million will go to cover accounts payable and other outstanding debt. The sale will net Coachmen at least $21 million, which will help the company become financially sound.
Forest River, a subsidiary of Berkshire Hathaway Inc., has agreed to retain the majority of Coachmen’s RV work force.
NU-WA INDUSTRIES CEASING PRODUCTION AND EXITING THE RV INDUSTRY
Tuesday, December 30, 2008
In a letter to dealers, Chanute, Kan.-based NuWa Industries Inc. said it is ceasing production of its high-end fifth-wheels after completing product already in process and will be making "a graceful exit from the RV industry.”
CEO Mike Mitchell said that the company could not see enough "light at the end of the tunnel to feel confident that market conditions would improve sufficiently to justify continued losses that would be incurred waiting for the market to return."
The builder anticipates closing down production in late January.
Dealers were told that NuWa is not going bankrupt and “will continue to meet its financial obligations to suppliers and finance companies.” The company said it has set aside the estimated funds to meet continued warranty obligations of product in the hands of consumers and on dealers lots.
In addition, the factory service center will remain open into at least 2010 to further meet the parts, warranty and service needs of retail customers and dealers.
A staff of approximately 20 NuWa employees will remain at the factory to oversee the warranty and service departments, to assist dealers and customers and to begin an orderly liquidation of equipment, excess raw materials and real estate not needed by the service department.
NuWa said the main facility will continue to be equipped for "turnkey" production in case a buyer surfaces.
In November, NuWa told RVBusiness that it was temporarily stopping production and would cancel its reservation at the National RV Trade Show in Louisville, Ky.
"We want to take a look to see what kind of sales are going to come in 2009," said NuWa President Neil Ford, noting that the parts, warranty and service departments would remain open.
Ford added, “The problem is the whole economy. Most of our customers are retired, and the price range of our units is not inexpensive. People can't get financed or they fear what the economy is going to do."
NuWa was formed in 1969 and earned a reputation as an innovative and quality builder. The company produces all-season fifth-wheels under the Hitchhiker LS, Hitchhiker Discover and Hitchhiker Champagne brand names.
RECALL: 2008 KEYSTONE LAREDO 5TH WHEEL TRAILERS: TIRE AND AXLE CERTIFICATION LABEL
KEYSTONE / LAREDO 2008
Manufacturer: KEYSTONE RV COMPANY Mfr's Report Date: DEC 01, 2008
NHTSA CAMPAIGN ID Number: 08V685000 NHTSA Action Number: N/A
Potential Number of Units Affected: 10
KEYSTONE IS RECALLING 10 MY 2008 LAREDO FIFTH WHEEL TRAVEL TRAILERS FOR FAILING TO COMPLY WITH THE REQUIREMENTS OF PART 567, 'CERTIFICATION.' THE FEDERAL IDENTIFICATION LABEL AND TIRE AND LOADING INFORMATION LABEL DOES NOT CONTAIN THE CORRECT GROSS AXLE WEIGHT RATING (GAWR). THE LABEL INDICATES A CAPACITY OF 6,000 LBS, BUT INSTEAD SHOULD READ 5,080 LBS. ALSO THE TIRE SIZE AND MAXIMUM INFLATION PRESSURE IS LISTED AT 235/80/R16E AT 80 PSI AND IT SHOULD BE 225/75/R15D AT 65 PSI MAXIMUM INFLATION.
LOADING THE VEHICLE BEYOND THE ACTUAL GAWR COULD RESULT IN POOR VEHICLE HANDLING CHARACTERISTICS, INCREASING THE RISK OF A CRASH.
OWNERS WILL BE PROVIDED WITH CORRECTED LABELS AND INSTALLATION INSTRUCTIONS. IF AN OWNER DESIRES, THEY CAN HAVE THEIR DEALER REPLACE THE TAGS FOR THEM. THE RECALL IS EXPECTED TO BEGIN DURING JANUARY 2009. OWNERS MAY CONTACT KEYSTONE RV AT 1-866-425-4369.
KEYSTONE RECALL NO. 08-114. CUSTOMERS MAY ALSO CONTACT THE NATIONAL HIGHWAY TRAFFIC SAFETY ADMINISTRATION'S VEHICLE SAFETY HOTLINE AT 1-888-327-4236 (TTY 1-800-424-9153), OR GO TO HTTP://WWW.SAFERCAR.GOV .
2009 WINNEBAGO (SIGHTSER/VISTA) & 2009 ITASCA (SUNOVA/SUNSTAR): TIRE CERTIFICATION LABEL
ITASCA / SUNOVA 2009
ITASCA / SUNSTAR 2009
WINNEBAGO / SIGHTSEER 2009
WINNEBAGO / VISTA 2009
Manufacturer: WINNEBAGO INDUSTRIES, INC. Mfr's Report Date: DEC 11, 2008
NHTSA CAMPAIGN ID Number: 08V681000 NHTSA Action Number: N/A
Potential Number of Units Affected: 36
WINNEBAGO IS RECALLING 36 MY 2009 VISTA, SIGHTSEER, AND ITASCA SUNSTAR AND SUNOVA MOTOR HOMES FOR FAILING TO COMPLY WITH THE REQUIREMENTS OF PART 567, 'CERTIFICATION.' . THESE VEHICLES WERE PRODUCED WITH A VEHICLE CERTIFICATION LABEL THAT STATES LOAD RANGE 'G' TIRES WHEN IN FACT THE VEHICLES ARE EQUIPPED WITH LOAD RANGE 'F' TIRES.
THE PURPOSE OF THIS PART IS TO SPECIFY THE CONTENT AND LOCATION OF, AND OTHER REQUIREMENTS FOR, THE CERTIFICATION LABEL TO BE AFFIXED TO MOTOR VEHICLES TO ADDRESS CERTIFICATION-RELATED DUTIES AND LIABILITIES, AND TO PROVIDE THE CONSUMER WITH INFORMATION TO ASSIST HIM OR HER IN DETERMINING WHICH OF THE FEDERAL MOTOR VEHICLE SAFETY STANDARDS ARE APPLICABLE TO THE VEHICLE.
WINNEBAGO WILL PROVIDE CORRECT FEDERAL CERTIFICATION LABELS AS WELL AS INSTALLATION INSTRUCTIONS TO THE MOTOR HOME OWNERS. IF AN OWNER DESIRES, THEY CAN HAVE THEIR DEALER REPLACE THE TAGS FOR THEM. THE RECALL IS EXPECTED TO BEGIN ON OR ABOUT JANUARY 2, 2009. OWNERS MAY CONTACT WINNEBAGO AT 1-641-585-6939.
WINNEBAGO RECALL NO. 111. CUSTOMERS MAY ALSO CONTACT THE NATIONAL HIGHWAY TRAFFIC SAFETY ADMINISTRATION'S VEHICLE SAFETY HOTLINE AT 1-888-327-4236 (TTY 1-800-424-9153), OR GO TO HTTP://WWW.SAFERCAR.GOV .
RECALL: 2007 TITAN MOTORHOME: DOMETIC REFRIGERATOR
TITAN / MOTOR HOME 2007
Manufacturer: TITAN COACHES Mfr's Report Date: DEC 12, 2008
NHTSA CAMPAIGN ID Number: 08V674000 NHTSA Action Number: EQ08010
Component: EQUIPMENT:RECREATIONAL VEHICLE
Potential Number of Units Affected: 2
TITAN IS RECALLING 2 MY 2007 MOTOR HOMES BUILT ON FREIGHTLINER CHASSIS AND EQUIPPED WITH A TWO-DOOR REFRIGERATOR MANUFACTURED BY THE DOMETIC CORPORATION. THE REFRIGERATOR MAY HAVE A DEFECT IN THE BOILER TUBE. PRESSURIZED COOLANT SOLUTION COULD BE RELEASED INTO AN AREA WHERE AN IGNITION SOURCE (GAS FLAME) IS PRESENT.
RELEASE OF COOLANT UNDER CERTAIN CONDITIONS COULD IGNITE AND RESULT IN A FIRE.
TITAN WILL BE WORKING WITH DOMETIC IN ORDER TO REPAIR THESE REFRIGERATORS (PLEASE SEE 08E032). DOMETIC WILL REPAIR THESE REFRIGERATORS BY INSTALLING A SECONDARY BURN HOUSING, A THERMAL FUSE, AND A MELT FUSE FREE OF CHARGE. DOMETIC HAS RETAINED STERICYCLE INC. TO MANAGE THIS CAMPAIGN. STERICYCLE WILL ASSIST THE OWNER IN LOCATING DEALERSHIPS OR SERVICE CENTERS AND WILL PROVIDE ASSISTANCE WITH SCHEDULING OF APPOINTMENTS. OWNERS MAY CONTACT DOMETIC/STERICYCLE AT 1-888-446-5157 OR TITAN AT 1-662-287-0105.
CUSTOMERS MAY ALSO CONTACT THE NATIONAL HIGHWAY TRAFFIC SAFETY ADMINISTRATION'S VEHICLE SAFETY HOTLINE AT 1-888-327-4236 (TTY 1-800-424-9153), OR GO TO HTTP://WWW.SAFERCAR.GOV .