RV Glut
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Coachmen will eliminate 12.5 percent of its salaried positions and 10 percent of its hourly work force according to this article in the South Bend Tribune.
The announcement marks a sharp departure from rosy projections offered at the start of the year by the Elkhart-based recreational vehicle and systems-built home manufacturer.
"The RV industry has been pretty slow and the housing market in the Midwest has been slow," said Jeff Tryka, Coachmen's director of investor relations.
Michiana RV, which calls itself the largest Midwest dealer of Coachmen recreational vehicles, has an unusually high inventory. High dealer inventories forced Coachmen to implement a cost-cutting program that eliminated more than 10 percent of the company's work force.
"This is a dip, and it was predicted," Martynowicz said. "But did anybody listen? No, everybody built more plants and dealers took on more inventory.
"We're confident the market will turn around," Tryka said.
I am very confident that it won't.
Caddman on the Motley Fool had this commentary to offer:
RV's are one of the first discretionary items to not buy when reducing spending. Notice how movie and concert ticket sales are also down this summer. Totally discretionary...
I agree.
Let's see how discretionary spending holds up in the second half of the year.
I bet not well.
Mike Shedlock / Mish
http://globaleconomicanalysis.blogspot.com/
