And Another One Bites The Dust

[Al - K4GLU]

My Way News - RV maker Monaco Coach files for Chapter 11

[Wayne&Sam]

Thier web site says prices START at $629K.

Imagine that, no buyers.

[Silvertwinkie]

This is pretty significant. Holiday Rambler which was at one point a very well made RV was owned by the company. Don't know if the HRs were as good as they were in the past, but HR is a very well known brand.

[Al - K4GLU]

Holiday Rambler and Safari are listed as two of their brands.

[moosetags]

That makes me feel sad.

Brian

[wahoonc]

The company's products, which include the Monaco, Holiday Rambler, Safari, Beaver, McKenzie, and R-Vision brand names along with several motorhome-only resorts,

From the article...that pretty well covers the spread of the RV market. I am sure there will be many more as things continue. RV's ARE NOT a necessity for the most part, they are a luxury item and people aren't spending much on luxury stuff right now.

Aaron

[Minnie's Mate]

Chapter 11 is debt reorganization. Delta Airlines went through it for the last couple of years and just emerged and merged with Northwest Airlines becoming the name of the newly formed merger corporation that is now the world's largest airline so it must have worked. GM is about to enter into Chapter 11 to reorganize their debt load. It doesn't mean they are gone, but it doesn't bode well for a company to go into any form of bankruptcy.

[Soyboy]

Rumor has it (if it hasn't happened already) that Fleetwood may be next. While not a big fan of Fleetwood products, I hope that the rumor is not true and that they stay in business. When these companies go, they take a whole lot of brands with them. I hope this stops soon, my heart goes out to the workers losing their jobs. Once this recession is over there will likely be a new generation of RV manufactures that will rise from the ashes of the troubled firms.

[Silvertwinkie]

Originally Posted by Minnie's Mate

Chapter 11 is debt reorganization. Delta Airlines went through it for the last couple of years and just emerged and merged with Northwest Airlines becoming the name of the newly formed merger corporation that is now the world's largest airline so it must have worked. GM is about to enter into Chapter 11 to reorganize their debt load. It doesn't mean they are gone, but it doesn't bode well for a company to go into any form of bankruptcy.

Yes, but reading the press release, the are talking about divesting all the company assets......they owe what they have in assets.


COBURG, Ore. (AP) - Recreational vehicle maker Monaco Coach Corp., which has seen sales plunge amid the recession, said Thursday it has filed for Chapter 11 bankruptcy protection.
The company said it plans to continue operating as it prepares to sell off parts or all of its business.
The RV maker, which sent termination notices to nearly all its remaining employees earlier this week after an unsuccessful 20-month turnaround effort, said it owes between $100 million and $500 million and has assets in the same range.

I wonder how many Thor brands might go away. I can't see 'em keeping them all.

[Minnie's Mate]

It's a shame. Of all the Class A's that my wife and I have looked at when going to RV shows, Monaco's are the only ones that my wife said looked like they were well enough made for her to consider. I still want an Airstream A39.

[jimmini]

Originally Posted by wahoonc

From the article...that pretty well covers the spread of the RV market. I am sure there will be many more as things continue. RV's ARE NOT a necessity for the most part, they are a luxury item and people aren't spending much on luxury stuff right now.

Aaron

A RV very well may be the only thing some folks will have left to live in.So it may not be a luxury to them. (Look at what is at the free parking in places like slab city and BLM land in CA, some of the things folk live in on BLM and Forest Service land in AZ) Better than living under a bridge.

I hope Thor and Airstream can hold out and make it.

[Silvertwinkie]

Thor will overall make it. They have cash in hand and do have a bus business which is doing well. I don't believe Thor would let the flagship brand Airstream go away, my thought is that brands may get consolidated at Thor. I mean if you really think about it, if you have 4 or 5 brands of box style trailers and/or motorhomes, and a significant portion of the competition is gone over the RV market tanking due to the economy, do you really need 4-5 box trailer lines, particularly if even in the best of circumstances, the RV market comes back ever so slowly after folks have woken up to the fact that disposable income may not be as disposable as once believed.......

Airstream is unique, but what will be an issue for them long term are their quality and corrosion issues. Until they get these even marginally under control, I can't see the now sober folks here in the country after this economic collapse shelling out 2 to 3x what an SOB would cost for this level of build from them, but I do believe they will be one of the few brands left. I think Thor will shutter plants and brands before they let the American Icon vanish. There is just too much brand recognition. Fly a dozen RVs down the road and one of them an Airstream and I bet you two things. The Airstream will be remembered and most will be able to say hey there are one of those silver bullets or Airstreams. How many times on the road do you say, hey look there is a Prowler or a Terry?

But mind you, even with that recognition, look at the domestic auto industry. Chevy is about a American as apple pie, yet it may not make it through the quasi depression we're in unless the Government(s) bails them out. There may be no bailout for the RV industry or nowhere near as much cause the job loss between the auto industry and the RV industry is just so incomparable.

At the very least, I think we'll see a leaner and meaner Airstream. Hopefully this time out the industry has will give Airstream time to rethink their processes and really not simply make upgrades but improvements as has been the company motto since the old Wally days. I personally feel Airstream has lost it's focus, but perhaps it will come back after something like what is going on around us today.

[myoung]

Sad. Over the years we have considered a Class A. The only two that we like are Monaco and Beaver. Well-built, beautiful, classy.

[53flyingcloud]

Originally Posted by Silvertwinkie

Yes, but reading the press release, the are talking about divesting all the company assets......they owe what they have in assets.


COBURG, Ore. (AP) - Recreational vehicle maker Monaco Coach Corp., which has seen sales plunge amid the recession, said Thursday it has filed for Chapter 11 bankruptcy protection.
The company said it plans to continue operating as it prepares to sell off parts or all of its business.
The RV maker, which sent termination notices to nearly all its remaining employees earlier this week after an unsuccessful 20-month turnaround effort, said it owes between $100 million and $500 million and has assets in the same range.

I wonder how many Thor brands might go away. I can't see 'em keeping them all.

They may claim this is Chapter 11 by definitions, BUT it sounds more like a whole new and different Chapter..called going, going, FOREVER GONE.. ..Sad.
I wonder about places like:
http://www.lazydays.com/
Which (used 2) sells a tonz of new products of theirs..

[leopattie]

Monaco and Country Coach are both local companies here - both in Chapter 11 - lots of people out of jobs.

[mutcth]

Originally Posted by Silvertwinkie

But mind you, even with that recognition, look at the domestic auto industry. Chevy is about a American as apple pie, yet it may not make it through the quasi depression we're in unless the Government(s) bails them out. There may be no bailout for the RV industry or nowhere near as much cause the job loss between the auto industry and the RV industry is just so incomparable.

On the plus side, Thor doesn't have any debt and was profitable not too long ago. It's been a while since most of the domestic car industry could make either claim.

[flyfisher]

Thought you guys might like to also read the following post made yesterday on a Newmar owner's forum that I particpate in. It's from a very well respected Newmar (and other lines) dealer in Oklahoma City.

"It's sad that Monaco may not be in business anymore, but maybe Warren Buffet or another investor will rescue them. Being a public company is both a blessing and a curse. It can raise money for the company and make the owners rich. However, the curses are numerous. You're usually not as nimble because of the layers of management. Audits and SEC filings are extremely expensive. But, IMO the biggest curse is that the pressure to perform each quarter is enormous. It can cause companies to make short-term decisions instead of doing what's best for the company long-term. Making ill-advised acquisitions or blowing out inventory at the end of the quarter to make the numbers can be the start of a slow death.

I think Monaco's decision to sell a national chain a ton of motorhomes at hugediscounts a few months ago was the beginning of the end. While I'm sure they felt it was something they needed to do to keep their line moving and their workers working, it angered the existing dealers as they had promised in their much ballyhooed "Franchise of the Future" that every dealer would pay the same price. Newmar was approached a couple of years ago by the same chain to give them special discounts and they refused.

Newmar has been under no pressure to perform each quarter and have the luxury to think long-term. They've saved their money over the years and stayed debt-free. They've invested in R&D and got a headstart on everyone with the motorhome slide-out. They've been very innovative over the years. They only build units that are sold to either dealers for stock or special orders for customers. If the orders slow down, they just slow down their production or shut it down completely until they accumulate a few weeks of orders.

Right now, they are about the only game in town that will do extensive specials. They are getting full price for their units and passing along any supplier increases. The next one was announced last week and will take effect March 23. Very small, but still an increase. Every few weeks they have to repurchase units that a west or east coast dealer defaults on, but most all of those units are repurchased below invoice and resold to the existing dealers. They don't have hundreds of dealers, so their exposure is less than most. I assume that the money they make on the units their building now helps defray the cost of some repurchases. Clearly, business is not great for any of the manufacturers, but there are quite a few treading water or losing money slowly.

Today's Newmar buyer has a choice between ordering a perfect custom coach at full price or buy a maybe not so perfect coach for them at a large discount. That has kept the distressed units moving well and the special orders have been coming in. There's seems to be significant pent-up demand. We just had the best February in our history. Every department set an all-time February record. It seems that buyers are realizing that this is the best RV buyer's market EVER if you're looking for a 2007 or 2008 repo or a pre-owned coach.

In the public sector I think that Winnebago, Thor and Forest River are very strong. In the private sector, Newmar, Jayco and Tiffin are in good shape, IMO. I've had in-depth discussions with Newmar and Jayco and they are in good shape. Of course, I can't prove that because they're private corporations. But, I trust what they tell me and they've always been straight with me. Some of these relationships are 20, 30 years old.

The biggest problem out there now is dealer financing, not customer financing. We're getting virtually everything we sell financed. They might have to put a little more down and they most definitely have to produce more proof of income, tax returns, etc. than before, but they do get financing.

Dealer inventory financing is another story. The credit markets are still
pretty much froze up for dealers. There are only 3 national lenders left in the game due to recent consolidations and others deciding to get out. The 3 left try to figure out ways of keeping the dealer from accessing their credit line. It's brutal and it's killing the manufacturers, too. Dealers want to buy product from them, but can't. Customers want to see the unit before they buy, but can't. I've had to bring in several lower end trailers COD (can't afford to do diesels COD!) because of all the red tape. Customers are purchasing half-million dollar Newmars without seeing them first, because of the discounts, but it's still a tougher sale.

Supposedly, the TALF/TARP bill will unfreeze the credit lines for dealers, but it hasn't happened yet. When it does, the deep discount deals will disappear quickly. That will likely happen in the next few weeks, just as seasonal demand increases. The manufacturers left standing should benefit quickly.

Lee Litchfield
www.leesrv.com

[wahoonc]

Originally Posted by jimmini

A RV very well may be the only thing some folks will have left to live in.So it may not be a luxury to them. (Look at what is at the free parking in places like slab city and BLM land in CA, some of the things folk live in on BLM and Forest Service land in AZ) Better than living under a bridge.

I hope Thor and Airstream can hold out and make it.

But those aren't brand new ones...

Aaron