Although Monaco Coach Corporation had become one of the nation’s largest RV manufacturers, it began 2009 in terrible shape, with most of its remaining 2,000 employees on furlough. Within a few months, it had filed for bankruptcy and was out of business.
Today Monaco plants in Oregon and Indiana are open again, turning out motorhomes and travel trailers with the familiar Monaco brand names, but under the ownership of a new company, Monaco RV, a unit of Navistar International, a global transportation company.
By itself, Monaco RV is much smaller than the old Monaco Coach, whose sales at its peak exceeded $1 billion a year, but it begins 2010 with encouraging prospects.
Foremost, it has the benefit of Navistar’s financial strength and expertise. Navistar is a holding company that dates back to the 1830s, and Cyrus McCormick’s invention of the mechanical reaper for harvesting grain. The company, which changed its name from International Harvester to Navistar in 1987, has units that build International trucks, MaxxForce diesel engines, school buses and military vehicles. It entered the RV business five years ago by acquiring Workhorse Custom Chassis, which makes chassis for motorhomes and stepvans.
In the last days of Monaco Coach’s 41-year history, the company was pushing its products hard into an unstable market, desperately trying to keep factories open and workers employed. As the recession deepened, depressing sales of all RVs and especially large luxury motorhomes, the company’s inventories grew, discounts became necessary to keep products moving, credit tightened, and the company collapsed.
Navistar, which has annual sales above $14 billion, purchased key factories, trademarks and other assets of Monaco Coach out of bankruptcy, formed Monaco RV, and hired members of the Monaco Coach management team to run the new company from its old headquarters in Coburg, Oregon, but with a new business approach.
The new approach puts more emphasis on building motorhomes and travel trailers to match the demands of the marketplace, according to Mike Snell, senior vice president of sales and product development. The company acquired all of the old Monaco Coach Corporation brands, including Monaco, Holiday Rambler, Beaver, Safari, McKenzie and R-Vision, but is focusing most production on segments of the market where demand seems highest. And currently, Snell said, that is primarily with lightweight towables and with motorhomes priced under $320,000.
Monaco is known for its high-end coaches and will continue to build for the super luxury market, but in this economic climate many people are looking for more affordable RVs and so that’s where most of the production is going.
Monaco plants reopened last summer, and the company has hired about 800 workers. Monaco RV is turning out two diesel motorhomes and six towable units a day in Oregon and two gas motorhomes and 13 towables a day in Indiana.
“That’s only a fraction of what we used to build,” Snell said, but it reflects current market conditions, with unemployment still high and credit tight.
RV industry analysts expect RV sales to rise in 2010 and Snell thinks Monaco is well positioned to take advantage of the surge.
Two new Monaco motorhomes that Snell thinks will find a strong market in 2010 are the Monaco Cayman and Holiday Rambler Neptune, two of the company’s more affordable Class A coaches that will now be available in 40-foot floor plans. The new models are built on a Roadmaster raised rail chassis with eight outboard-mounted airbags and eight shock absorbers and a powerful Cummins ISC 360-horsepower engine.
The models have a new full-body paint scheme and lots of luxury features, including options such as a residential refrigerator, stackable washer/dryer combination and king-sized bed. Snell said he thinks 40 feet is the perfect size for a Class A coach, and with the new models, “We’ve got a nice, affordable coach that is 40 feet.”
Monaco’s emphasis with its travel trailers in 2010 will be on lightweight models, including the debut of the first fifth wheels in R-Vision’s popular Trail-Lite series.
Snell said Monaco RV is drawing on Navistar’s resources and engineering expertise to improve its products. “We are really going to work on fuel economy,” he said. In the trucking industry, he noted, adding just one more mile per gallon can translate into huge savings, so there is a lot to be learned from Navistar’s experience with International trucks.
Beyond that, he said, Navistar has resources in everything from marketing to purchasing power that can benefit Monaco RV. “The synergies are huge,” he said.
Monaco RV has lined up more than 150 dealers to sell its products, including 40 who are handling motorhomes. Snell hopes to double the number of motorhome dealers over the next two years.
Despite the bankruptcy of Monaco Coach Corporation, Monaco brands have retained a strong following. Monaco RV sponsored its first Monaco coach rally in October, and the owners of more than 500 motorhomes gathered in Tucson, Arizona, for the event. Monaco RV used the event to discuss the future of the company and to solicit suggestions on future products. Snell said, “It’s important to us to listen closely to the ideas and suggestions of the owners of our brands—after all, they are the best product experts.”
Snell emphasized that Monaco RV is part of a strong company with a rich history in the transportation industry and that Navistar is in the RV business “for the long haul.”
Of all the companies that could have acquired the Monaco brands, none is a better fit than Navistar, Snell said. “We couldn’t be more pleased.”
You can read more about Monaco’s new products and those of other RV manufacturers on Page 10 in our report on the National RV Trade Show held last month in Louisville, Kentucky.
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.