The announcement that MVP RV in Riverside, California, will build 30,000 motorhomes for the Chinese market elicited a predictable reaction.
“Our phones haven’t stopped ringing,” said Scott Degnan, MVP’s vice president of sales and marketing. Not only are workers clamoring for the 1,200 new jobs that are being created, but suppliers and vendors are jockeying to get in on the action, too.
When production reaches its peak, the company will be turning out 30 motorhomes a day. That kind of volume entices suppliers to compete for business by cutting prices, Degnan said, benefiting both MVP and its customers.
Most of the motorhomes destined for China will be Class C models. The Tahoe, which the company introduced at the National RV Trade Show in Louisville late last year and carries a suggested retail price of $60,544 in the U.S., will be built for the Chinese market with only slight differences.
MVP is developing a tag axle Class A diesel motorcoach, and it, too, will be built for sale in both the U.S. and China.
The company expects to export about 10,000 Class A and 20,000 Class C coaches over the next three or four years.
Degnan said China is rapidly developing the highway infrastructure and the campgrounds necessary for RV travel. The “Made in the USA” label will help sell the motorhomes, he said, because the Chinese want the kind of RVs now available in America. “It’s a huge potential market—larger than the U.S. market,” he said.
The trade deal with China is the result of investments by Winston Chung, a Chinese entrepreneur and pioneering developer of rare-earth lithium battery technology. Chung is both majority owner of MVP and head of Winston Global Energy, which plans to import the motorhomes to China.
Three executives of Thor California, a travel trailer division of Thor Industries, formed MVP RV in 2008 by buying the company from Thor and renaming it. Hit hard by the recession, the company stopped production for a while and explored the possibility of building electric cars. That exploration led company executives to Chung, who became their business partner.
Last year, MVP paid $18.6 million to buy two state-of-the-art factories in Riverside that were vacated by Fleetwood Enterprises and began turning out travel trailers, toy haulers and fifth wheels.
Chung is pouring $310 million into MVP to gear up for motorhome production for China. The investment is huge, but the return could be even greater—a projected $5 billion in sales, according to company estimates.
While MVP will be building gas and diesel motorhomes for the U.S. and China, its long-range focus is on electric motorhomes. Last year, MVP built a 42-foot motorhome called the Winston that is all-electric and has a range of 180 miles on a single charge, using the rare-earth lithium yttrium battery invented by Chung. Recharging time for the batteries can be as quick as 20 minutes.
Degnan said MVP is continuing to work on all-electric motorhomes, but given the current cost—more than a million dollars a vehicle—and the fact that charging stations are not yet widely available, don’t expect to see many on the road soon. However, by pioneering this technology, MVP will be ready to move forward with electric motorhomes when the time comes.
In a recent Los Angeles Times interview, Chung indicated that motorhome production might eventually be done in China, but, if so, he would “like it to be for the manufacturing of electric RVs.”
The interview was conducted through an interpreter at an event announcing Chung’s donation of $10 million to the University of California, Riverside, to support research on clean battery power, solar energy and sustainable transportation. The university is renaming its engineering building Winston Chung Hall.
Chung told the Times that the Chinese government supports the growth of the RV industry as a foundation for good family life. “A family with an RV is a family more in harmony with each other,” he said. “During vacations, people can get into the RV and enjoy quality family time.”
While the trade deal is a huge boost for MVP, the company also has been growing rapidly through sales outlets on the West Coast, Degnan said, and the company intends to continue winning buyers in the U.S.
MVP RV has 500,000 square feet of factory space on 23 acres that were once owned by Fleetwood Enterprises. After going bankrupt in 2009, Fleetwood Enterprises sold its motorhome business to a new company, Fleetwood RV, which moved all production to Indiana, leaving the Riverside plants idle.
Degnan said MVP plans to hire about 1,200 workers to add to the 150 employees already in place before the trade agreement was announced. Degnan noted that suppliers such as Ford, which provides the chassis for the Class C Tahoe, will also have to ramp up production, and that should mean the creation of even more new jobs.
The growth of MVP revitalizes a Southern California RV industry that was badly hurt by the recession, with the disappearance of jobs at Fleetwood, Weekend Warrior and others. At its height, Fleetwood employed 21,000 workers.
Can MVP RV have the kind of success Fleetwood once enjoyed? Degnan is confident. “I think we’ll be larger,” he said.
Follow Up Note: In our January column we reported on a 1935 Bowlus Road Chief that was to be auctioned off by Gooding & Company at their 2011 Scottsdale auction.
The results are in, and The Road Chief, a forerunner to Airstream aluminum travel trailers, sold for $187,000, including commission. In 1935, the list price of the standard Road Chief was $1,090. Add tax and all the available extras and you would have paid $1,342. n
Write to Mike Ward, editor at RV Life magazine, 18717 76th Avenue West, Suite B, Lynnwood, WA 98037 or e-mail email@example.com. Find First Glance online at rvlife.com.