RV suppliers brace for ripple effect after layoffs

by Sarah Rice (srice@wsbt.com)

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The price of steel — the main material used to make many RV components — has tripled in the past few years

The price of steel — the main material used to make many RV components — has tripled in the past few years. (WSBT photo)

By WSBT News1

Story Created: Jul 18, 2008 at 4:42 PM EST

Story Updated: Jul 22, 2008 at 9:49 PM EST

GOSHEN -- 1,400 area workers will be without jobs come September. Thursday Monaco Coach announced it's closing all of its plants in Elkhart County and moving to Oregon. The news is now concerning local suppliers.

"Our impact will be just in terms of volumes. It should drop probably 20 percent on our volumes that we sell Monaco," said Lippert Components National Sales Manager Jim Treadway.

Lippert Components in Goshen is one of Monaco Coach's largest local suppliers.

"We build fifth-wheel travel trailer chassis, and then we also build, for their motorized product, we also build their slide-out mechanisms," explained Lippert Components Chief Information Officer Jamie Schnur.

Industry experts say Lippert isn't the only company that will be affected by the recent layoffs at Monaco Coach.

"Companies with less than 10 employees that supply little things like netting, little rubber bungie cords where Monaco one was one of their bigger accounts — they're going to be in trouble,” said Treadway.

And places like Norco and Dometic in Elkhart could also be affected.

"Dometic is a big, big supplier. Dometic supplies refrigerators, ranges, air conditioners," said Treadway.

There's no doubt the RV industry has seen a major downturn for quite some time. And it's something Lippert has been preparing for.

"We saw this coming approximately 18 to 24 months ago. And we made the hard decision to start closing down some of our divisions throughout the county. And fortunate for us we were ahead of the game there," said Schnur.

It's the skyrocketing cost of materials like steel that are attributing to the industry's tough times.

"A lot of it you can see has been sitting here for a while due to the fact that sales are turning down," said Schnur, pointing to piles of steel at Lippert Components.

Steel is the main material to make many of the components used in RVs. The price has tripled over the past few years.

"That, combined with fuel, consumer confidence. It's somewhat the perfect storm," Treadway.

Lippert Components used to have nearly 40 divisions across the country. They now have only 16.

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