Country Coach May be Closing

[mcirco]

I don't have all the details yet but my friends at Country Coach have notified me that the company is closing in February if they cannot get additional financing. I don't have many details yet but I will share them as soon as I know.

Miles and Laura Circo
2004 Country Coach XLII 45' D/S

[Joe Cannarozzi]

How much unsold inventory do they have?

[mcirco]

Hi Joe,

There are a few new Prevosts which are owned by dealers but I am unaware of any unsold inventory at the factory. Country Coach Prevost Conversions were built specifically to dealer or customer orders. There were no unsold units at the factory and no consigned units to their dealers. I don't know about any of the plastic coaches.

Miles Circo

[Jon Wehrenberg]

The seriousness of that situation cannot be overstated.

CC has historically had a proprietary system that not only controlled a lot of house functions, but it intergated a lot of Prevost functions. Unless Prevost has technicians trained in dealing with the CC interfaces some system failures can create some real problems.

Guys like Nick Hessler may be worth their weight in gold unless CC provides access to their engineering, or other companies pick up the responsibility for customer support.

I don't know how much of a crossover there is between the conversions and the plastic coaches, but there may also be dealers capable of servicing these coaches. The time to find out where to go for service is now, before the company ceases operating (if it does).

[tdelorme]

So, Miles, you are saying the whole company is going out of business. or just the conversion plant? If we're talking Country Coach as a whole, I am really shocked. Hopefully someone will jump in here and keep parts and service available. Didn't someone post awhile back that the CC service dept took months to get an appointment with?

[tdelorme]

http://www.kmtr.com/news/local/story/Country-Coach-warns-of-possible-shutdown/PzZL97Xh1Uuxctce26KtdA.cspx

[rfoster]

If you have some time to spare- this is another article out yesterday on CC.

http://www.registerguard.com/csp/cms/sites/web/news/5064862-35/story.csp

[mcirco]

It's too soon to know exactly what the long term status of service and support will be. The Country Coach execs have not given up and wish to continue operations but had to notify their employess of the possibility of the shutdown and/or significant layoffs to comply with the US Department of Labor Worker Adjustment and Retraining Notification Act (WARN Act).

In terms of service and retrofit of Country Coach Prevosts, Oregon Motorcoach Center has all the capabilities. The organization is run by the founder of Country Coach, Bob Lee and his family, and was set-up specifically to keep Country Coach and other "luxury" motorhomes on the road. Lloyd and Pamela can tell you all about Oregon Motorcoach but their team has all the expertise to deal with the unique aspects of the Country Coach Prevosts especially the pre-2004 conversions.

As my contacts at Country Coach know more I will keep everyone posted.

Miles

[LarryB]

Miles, your correct about Bob Lee's new operation. There is a wealth of experience in the Colburg/Eugene, OR. working for independent service centers. Desert West in Phoenix, AZ. is another option.
As with the East coast converters lack of facilities here on the West coast, it will be more difficult to find CC service the farther East one travels.

I am not too concerned with the possibility of CC demise except for the people that will be out of work, lives disrupted, and the loss of a major player in the industry.

I have never been to the factory for service in the 5 years of CC motorhome ownership, and their tech support line was not always manned by knowledgeable folks. I know several CC Prevost owners that would say the same. The factory service seemed to be for those with newer coaches still under warranty. This may not be the case, just my impression.

I do hope CC pulls it off but, it really will not be the end of the world for those of us with older [read vintage] buses.

[Will Garner]

Miles, your correct about Bob Lee's new operation. There is a wealth of experience in the Colburg/Eugene, OR. working for independent service centers. Desert West in Phoenix, AZ. is another option.
As with the East coast converters lack of facilities here on the West coast, it will be more difficult to find CC service the farther East one travels.

I am not too concerned with the possibility of CC demise except for the people that will be out of work, lives disrupted, and the loss of a major player in the industry.

I have never been to the factory for service in the 5 years of CC motorhome ownership, and their tech support line was not always manned by knowledgeable folks. I know several CC Prevost owners that would say the same. The factory service seemed to be for those with newer coaches still under warranty. This may not be the case, just my impression.

I do hope CC pulls it off but, it really will not be the end of the world for those of us with older [read vintage] buses.


Larry B,

I had the misfortune to need some repair work last summer (2008). Since I was on the west coast and going through Junction City on my way back to NC, I thought going direct to CC would be the best option. Wrong! I went to their offices and no one really went out of their way to assist me. They did give me directions to the building where "repairs" were handled. I went to that building and was then told that CC was only doing repair work on units remaining under warranty. Mine, of course, was way beyond any warranty considerations.

Now I am only a Civil Engineer dealing with traffic management logistics, however it seems to me that if your business in sales is down and you have service facilities that you would want to pursue increasing your repair/maintenance services to support the overall business. I guess that makes for bad business because I surely did not receive a friendly welcome from CC's staffers nor did any repairs actually get done. Fortunately the repairs were comfort related not safety or operations related so we made the run back to NC and had repairs done locally.

[gmcbuffalo]

Several years ago I had my aging sattelite dish worked on by Carriers and sons and they were in Eugene Oregon. Just up the road from them was the CC bus conversion build facilities, so I always assumed that the Engene CC center was for Bus conversons and the Junction City center was for plastic coaches. Is this not so amymore? If so that seems like the center to call or go to instead of the JC center.
GregM

[LarryB]

Greg, the Bus converson center is now Oregon Motorcoach, Bob lee's new company. The Bus works has been moved to some where near the main factory in Junction City, I'm told.

[LarryB]

Carol & Will, I have read stories like your's on the CC owners group. Seems the Howard Boys adopted a 'tick off the customer' policy a little over a year ago.
In my mind the Howards have been in over their heads since they took over CC.

[jack14r]

Another web site said that when they purchased CC that they took on 13 million in debt,I bet that the small manufacturers in this country without debt have a much greater chance of survival.During this environment new product development like the Veranda might be too costly and a detriment to the company

[Petervs]

The article said they assumed $13 million in debt but bought the company for $38 million additional. You can bet that when investors bought the company they financed the major portion of that as well.

I would not be surprised if the total debt load was $40-45 MILLION. The intent is, of course, for cash flow from operations to pay the monthly interest on the debt, grow the company for a few years, and then sell it again for a higher price, at which point the outstanding debt is repaid.

This leaves bit one unsolvable problem....if sales slump, cash flow dries up, and you have no option but to go into default. And at that point nobody else will finance you either.

Let;s see, $40 million at 6% per year is $200,000 INTEREST PAYMENTS PER MONTH, you can use up working capital pretty quick at that rate.

[garyde]

About 10 years ago, when I went to my first FMCA Rally, I walked thru the Country Coach Exhibition area and was very impressed with their Coach. compared to all the other manufactures , this company seemed to have it together. What a precipitous slide since those strong sales years. The Company was sold for all the wrong reasons, and then repurchased at way too high a price in hindsight. It would be a sad day if Country Coach went away.

[Coloradobus]

Hey Gary,
At that 10 years ago time, Bob Lee was at the CC helm and that is why you were so impressed with the display. Having owned 2 Country Coaches, the quality, the facotry personel and helpfullness, and support is why we bought the Affinity and later the XL after having a dreadful experience with a plastic Airstream box on the freightliner chassis.
It seems to us that perhaps Oregon Motorcoach Company may become the new "Country Coach" by another name. Bob Lee to the rescue,.
We have always wondered why the Howards were put in charge of Country Coach, since their past rv business dealings went down in flames.
During a diinner at the 2003 Las Vegas Circus Circus winter rally where we were participants, Jay Howard made some very durrogatory comments about NON CC brand motorhomes of which we were one with our Marathon XLII. The crowd groaned at what was said.
An aledged policy of irritating the customer dates way back.

[garyde]

As of this year, I still maintain my Country Coach membership because I enjoyed their Rallies. They always seemed to welcome anyone and everyone regardless of the Coach one owned at the time. This was a strength of theirs. It does seem odd the traditions and the culture has been dilluted or discarded by the people at the helm.

[Tully]

I guess the real question is what this will actually mean to all the Country Coach owners. Does anyone really know?

I know Joe C. did a ton of work on my "camper" as he calls it. He knows a lot on operations of the bus. I doubt I could or would ever driven to Junction City anyhow for service.

Heck, I faxed a question and photo to the service department at Country Coach. I go a return phone call exactly three weeks latter. This fax was sent to them back in June. I had almost forgot about the issue till one day I got a call. Waiting three weeks for a reply is almost as bad as having to wait 4-6 weeks for the junk you buy from those tv commercials.

So, at the end of the day- what does this mean if they do go under? I hope they do not. I guess the value of Country Coach products could drop even further in value (than most rv's) are now?

Iam happy with my bus. I like the build quality. I have someone like Joe C. who can help me with a majority of the problems along with the great help form this forum.

I would be more concerned if this forum no longer existed more so than Country Coach at this point.



Tully Lee Garrett

[Coloradobus]

LIke Tully, we have gone to Country Coach Rallies as an "S.O.B" (some other brand) Marathon. Having 2 past coaches that were CC's. we have many friends. It is very nice, that they accept any brand of coach in to participate.

[Coloradobus]

Got this morning
News January 06, 2009





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05Investors, buyers may benefit from Country Coach's woes
Greg Gerber posted on January 05, 2009 11:56
JUNCTION CITY, Ore. — Troubled times for Country Coach could be good news for bargain hunters — both customers looking to get a deal on a new motor home, and investors ready to swoop in and pick up the pieces of a company that still has a strong reputation for building high-quality RVs, a local RV dealer said.

The privately held company notified its 500 employees on Tuesday that it will be forced to permanently shut down by Feb. 28 unless it obtains new financing. Even if it obtains the financing, the company said, it expects to impose “mass layoffs” starting around March 1.

The factory stopped production in November, and was to have resumed work on Monday, but will remain closed until further notice.

Guaranty RV Super Centers in Junction City is a major dealer for Country Coach. General manager Shannon Nill said Friday he’s hopeful the RV maker will be able to get the capital infusion it needs to stay in business.

“They have a few investors, and they’re looking for one more,” he said.

Country Coach’s majority owner is Los Angeles investment banker Bryant Riley. He and a group of investors that included Country Coach’s founder Bob Lee, CEO Jay Howard and his brother, vice president Jim Howard, bought Country Coach in February 2007 from National R.V. Holdings for $38.75 million. Nill said he’s heard from company officials that its value is now around $16 million.

Nill also said he’s heard rumors the company might be drawing interest from Warren Buffett, whose Berkshire Hathaway owns Indiana RV company Forest River and recently bought the RV assets of Coachman Industries.

Even with the company’s troubles, people are still buying Country Coaches, Nill said. Guaranty has sold five in the past week, he said. He said Country Coach is the “top quality brand” in the RV industry, rivaled only by Monaco Coach in Coburg.

Nill said the company’s woes likely will bring out customers looking for deals.

“These people know fully well what the situation is,” he said. “It’s a buyer’s market. People buying Country Coach will pay less than we pay. … They can buy a top-quality product at a depressed price. We’ve got to find homes for these things.”

SOURCE: Register Guard

Posted in: Dealer News

[Coloradobus]

The latest news about Country Coach



Country Coach, Lee Try to Work Out Dispute
RV Business
Friday, January 9, 2009

The 500 employees at the idled Country Coach plant in Junction City, Ore., shouldn’t wait around for the plant to restart, founder and investor Bob Lee told the Register-Guard, Thursday (Jan. 9).

“They should be out looking for a job,” he said in an interview.

Country Coach’s attorney, however, said that the company has every reason to believe it will continue operations.

Lee has been at odds with the company since December when he sued to evict Country Coach from its 60-acre property in Junction City that Lee and his family continue to own.

This is after Lee sold the company he founded to Perris, Calif.-based National RV Inc., watched it lose millions of dollars over 11 years, then helped a clutch of investors re-buy the company, returning to the Junction City campus in 2007 as a hero.

CEO Jay Howard referred to Lee as the “essence of Country Coach” at the time.

The eviction lawsuit is just one more sign of the luxury recreational vehicle maker’s financial woes.

Just over a week ago, Howard sent a letter to employees saying the plant might close permanently if the company could not get new financing, and that massive layoffs are in the works in any case.

Howard did not return calls to the Register-Guard seeking comment for this story.

But, on Thursday, Country Coach attorney Todd R. Johnston provided a written statement saying that the company will remain in its current location and that “Country Coach has every reason to believe that the financing it needs to continue operations will be forthcoming and that the valuable niche it has developed in this market will be preserved.”

Attorney David Wade, who represents Lee, his wife Terry, and his brother Ronald, said the family is prepared to dismiss the eviction lawsuit under a set of terms that Wade declined to disclose.

“Let’s just say that, if it’s performed the landlord will be satisfied, and we’ll dismiss the eviction proceeding — and I expect it to be performed.”

The Lee family brought the lawsuit, court records show, after Country Coach defaulted on the December lease payment on the plant property — located on eight city blocks in Junction City.

Lee said the family was not trying to shut the plant down or require it to move.

“Sometimes you have to use a little force to get the decision you’re looking for,” Lee said. “It was a way to keep the pieces in place. That’s all we we’re doing. It was a way to keep things from being auctioned off. It succeeded, I think.”

Lee said he has no direct say in business decisions, even though he was named “emeritus CEO” when he returned in 2007, after a Los Angeles-based private investment group that he was allied with bought the company.

Lee said he’d worked at other RV enterprises alongside Howard, who the investment group installed as CEO in Junction City.

“Jay and I have worked on three turnarounds and they were all successful except this one. So far, we’re not successful in turning this one around, but the economy has gotten so much worse,” Lee said.

The economic downturn has been brutal on the nation’s RV makers.

The Register-Guard reported that the industry has shipped 50% fewer Class A units — the large, bus-like motorhomes — this year compared to the previous year.

In the past 12 months, 45 of about 2,850 RV dealerships around the country have closed, according to the Recreation Vehicle Dealers Association (RVDA).

Country Coach began a series of layoffs in December 2007, with the work force falling from as many as 1,800 workers to about 500.

Last month, Country Coach doubled its usual holiday idle period to four weeks. The plant had been set to restart on Jan. 5, but, as of Thursday, there was no sign of resumption.

“The finance companies are not working with us much,” Lee said. “There’s no money to buy a new coach; You have a hard time getting a loan, if you’re a buyer. The banks won’t (provide) loans for coaches to the dealers because the dealers can’t afford to do it — so you can’t build any new product and you can’t pay your suppliers.”

Country Coach fell behind on its payments to suppliers, who tried to remain patient so the company could regain its footing, company officials previously said.

“We’re working to get the pieces together so (Country Coach) can get enough money together to pay some of the suppliers who can’t afford to carry it anymore,” Lee said Thursday.

“All the little mom and pop shops in the Junction City, Harrisburg and Monroe area, all those people are in trouble because the RV company is in trouble. The economy today is just upside down.”

Lee said he’s still striving to preserve Country Coach — and that the company’s current nosedive is painful for him to witness.

“The lender is in on some of the things we’re doing; it’s not as much as we’d like. (And) we’re trying to get the investors to come more in, too,” he said. “We’ll work with them until everything is gone — or it’s up and running again.”

[Coloradobus]

Report: CCI Workers Told to Pick up Belongings
RV Business
Friday, January 30, 2009

Employees of struggling RV manufacturer Country Coach Inc. fear the Junction City, Ore.-based company is on the verge of a shutdown, but a company spokesman said he has no information that the company is closing.

According to a report by KVAL, four Country Coach employees and a supervisor said they've been told to remove their personal property from the premises ahead of a shutdown.

Matt Howard, a Country Coach spokesman, confirmed that employees may have been asked to remove personal property from the plant but said he had no information that the company was shutting down.

"Many managers were encouraged over the last couple days to have employees remove their personal items from the property, due to the uncertainty of Country Coach's future," Howard wrote in an e-mail to KVAL News. "It is no secret that Country Coach needs financing to continue, and no such financing has yet been secured. No doubt this communication to pick up their personal items has created this new activity."

"We may close permanently at any moment in the next 30 days, or we may not," Howard wrote. "At this point, nothing is certain. Keep in mind that supervisor level positions have been laid off for more than 60 days in most cases, so I am not confident that they would have accurate updated information. Run what you like, but I am not aware of any definite closure plans."

Last July, Country Coach was one of Lane County's top 10 employers. The company made a series of layoffs in 2008, reducing its work force from about 1,200 to around 500.

[bonhall41]

The industry is definitely struggling. Got an e-mail this morning that Featherlite has a new 2007 XLII double-slide model for $899K. Inventory number is 8912 if anyone is interested. They're heavily discounting all the units they have in stock.

[ajhaig]

Does anyone have more insight into the new coach market?

Are people buying new coaches at a rate that can sustain the remaining converters?

[Coloradobus]

Rumor has it, altho unsubtantiated, Marathon just sold a 4 slider for a measily $$ Million. It listed for $2.2:eek:

[garyde]

My feeling is it is no longer a question of 'who' will survive but more a question 'will any Convertors survive'. At it's core, this economic crisis is a bank collapse. The fed is trying to re-inflate the banks, but many of them are so up side down you can't call them banks.
Consumer borrowing is almost dead.

[jack14r]

I looked at a new 2007 Featherlite last summer at a buses & bikers rally and it had a 2005 shell,I heard that at the Tampa super show that new XLIIs were 799K.Since almost no one has purchased a coach recently the converter inventory is getting older,but their holding cost has increased.I don't think that anyone has a clue as to when this situation could improve,I bet that it would be almost impossible to get financing on a new coach.The converters are in a difficult position,price won't sell it and if it does there is little financing out there.Featherlite still has 25+ coaches to sell,I bet that it might take 3 years to clean out their inventory.

[0533]

Well the problem has now spread back to the Mothership at Prevost Car. It is liken to the worker Bees bringing pollen back to the hive for the Queen, no pollen no honey for the queen.

Prevost Car has been laying off staff here in Florida, Volvo has just laid off a bunch of employees and Prevost Car for sure is not building many or any shells for converters.

I was the only motorhome customer at Prevost Car Jax. on Friday, no problem getting people to work on my bus.

I am almost always in a positive mood when it comes to business, have actually had a good Jan. in my business, but am not very excited about much else.

Too much power in too few hands, too much greed in too few hands with too much wealth in the hands of people who simply do not care about how or what the outcome of their actions will bring to the rest of the world, as long as they get theirs. I am a free market person myself, but do not like to see the cards stacked and the game rigged by those who only want complete control over everything. There must be a middle ground

We have seen this with the robber barons in the past, and history always repeats itself, power, greed and corruption creates havoc and despair. There needs to be checks and balance, and a sense of fair play and people who give a sh.. about others.

It is a very strange time we live in now, and I am afraid we have not seen the bottom and will not for sometime in this industry.

PS> My wife made me cancel my order for our 50 million dollar corporate jet this week, we doing our part.

[Yankee802]

Bruce, so you are NOT citi's CEO then! :)

[jack14r]

Even though this is thread creep,should the Prevost pricing guide be updated since most years have taken a 30% or more hit?

[jelmore]

Even though this is thread creep,should the Prevost pricing guide be updated since most years have taken a 30% or more hit?

I'm just keeping my head in the sand.

[JIM CHALOUPKA]

Jack, I think JPJ used to do that. It might be difficult to do now that he's gone.

JIM

[Jim Skiff]

Jack,

We are currently working on updating the Prevost Pricing Guide.

In this dynamic market it is a challenge as we get feedback from a variety of sources.

Prevost-stuff.com had over 5.4 million hits last month which shows folks
still have a strong interest in Prevosts and are searching for a coach.

We see quite a few coaches sold and quite a few stay...it depends on the coach and the price.

The good news is that POG is the best thing the RV Business has to offer at any level. Folks getting together, shooting the sh-- and having fun.

See you soon.

Jim

[jello_jeep]

Jim, I don't think jpj had any corner on the knowledge market, and after the EVIL things he did to our fearless leader, even if it couldn't be replicated it would be a small price to pay!



Jack, I think JPJ used to do that. It might be difficult to do now that he's gone.

JIM

[Joe Cannarozzi]

I used to think something was worth what you could get for it in a reasonable amount of time but now its value is in its enjoyment, peroid:o

[JIM CHALOUPKA]

Your right on that account Warren. I was just stating the fact!

JIM

[jack14r]

Jim,I am impressed with 5.4 million hits in a month,you are right that this is a dynamic market.I believe that your site(POG) is the authority on Prevost conversions.It will be very difficult to estimate what values should be.

[0533]

I would be extremely careful in this process, and maybe wait until the dust settles on the market for now.

If some or many of the big players go belly up, regroup or disappear all together the landscape will change over time.

By 2010 there will be fewer new coaches on the market, who knows after a few years the supply might not meet the demand.

It is my guess that Prevost Car/Volvo will dramatically change the terms of sale (credit) for new shells starting Jan 1, 2009 requiring cash, no credit terms at all. This will drive the numbers down quickly, reducing the emphasis on new coaches at the converters like Marathon and Liberty and placing it back onto the used market.

The bottom line here is not to rush out and devalue or even revalue our buses until the dust settles.

The dealers would love to have us reduce our prices to historic lows, makes their job easier, in fact if the dealers get involved in deciding what the fair market value will be I bet it will be closer to wholesale than retail.

I for one would rather let the marketplace decide what the selling price is rather than to set the price here on POG.

[Kevin Erion]

Bruce, well said!

[Denny]

Bruce,

I think you are 100% correct. It is a basic principle of supply and demand; the less supply the higher the price. Once the new coach buyers and nearly new buyers dry up the existing market at those great prices than the field is level again. I think when the person who buys a 2 million dollar coach for a million goes to sell it, he is not going to base his selling price on the million he paid for it but on the original price of 2 million. He is going to take advantage of his good find and not pass it on to the next buyer.

This then starts the process of bringing up the rest of the prices. I feel, and it is my opinion and we all know about opinions, that our buses will start to increase in price once the economy starts to turn around.

[Alek&Lucia]

Jim,

I agree with Bruce, and others in this subject. Don't touch the pricing guide.
It is very helpful for insurance quotes, and also if you check around, private sellers and dealers of good buses are still asking and getting those prices that are posted in the guide. If we change the guide to lower prices we will be in the bracket equal with Essex, HR Navigators, Monaco Signatures, Travel Supremes etc etc etc.
Let's concentrate on good maintenance of our toys, having fun with them, that when the buyer will come they will be in the top shape to sell,

Alek

[0533]

I would rather not play "Aint It awful" but rather look at the facts.

These buses will always only be right for a handful of lets say eccentric folks who want and understand that we all only go around once in life.

If the universe of current and future Bus buyers is limited to a fraction of the RV buying public, lets say that there are 100,000 (less now) Rv's sold each year (just a round #) I would suggest that the Prevost buyer represents less than 1/2 of 1% or around 500 active customers per year, this may be high. This small number does not require a mass market approach including setting retail pricing.

Our buses are for a handful of people who really want to own something special.

If we devalue our Prevost buses down to the current RV marketplace level, lets say 40% or more off last year, not unreasonable number, then our buses run the risk of becoming a pile of Stainless that ends up in the Eagle category mostly gone for ever at some point.

Prevost Car will not be making the XL model much longer, I bet the H model will become the standard. Prevost Car has to become more practical including simplifying the production line and reducing costs, parts and making service and warrantee work less costly. They will have to turn their attention to the seated market who wants only the H model, a lot for less.

If I were in charge at Prevost, I would make this change now. Prevost has more warrantee issues by 10 fold with the RV shells than the seated coaches. I was told that Detroit will no longer supply engines to Volvo, this alone will bring about change.

If we all play it right our buses will hold a special place in history and if we keep each at a high standard of quality the entire Prevost used market will keep its value.

Our buses have to stay in the hands of people who will keep them as the special pieces of history that each is, it is in our hands, so consider the risk and rewards.

[garyde]

The Market is the Market. No one can control the Market. Right now, its favoring buyers by a lot. 3 years from now , who knows. Inflation will be up because of all of the Govt. spending. So prices will rise.
Right now, its a great time to buy for those who are aching to buy a Prevost and have the funds. There is not much down side for these folks.
For the rest of us, "hold onto to your seats, its going to be a bumpy ride"

[Tully]

Let's not forget that even though this is a "buyers market" for a bus or home- it is a double edge sword. It is never just that simple.

Factor in very difficult financing to this. Yea, you can get things cheap but even so- getting money to finance is very hard. Even if you have good credit.

Look at the Fico score. 700 used to be "A" paper. Now many mortgage companies and lenders require a 740! to be the starting point for "A" paper. One can almost kiss good by getting a home equity loan as one either has negative equity or is at a break even point. Those who have equity are using what little they have to hold off the fast depreciation our homes and property are taking.

This is the check and balance.

If you cash heavy then right now is the perfect time.

If you are dependent on a loan from a bank or lending institution- then hold on for the bumpy ride.

It is going to be several years before things calm down. NO one has the answer. Speculation is all we have.

The Prevost bus is unique. But like all things is in for a wild ride during these strange and uncertain times.

Tully

[ajhaig]

I don't see the harm in having a pricing guide, I don't think that POG necessarily sets the market and the price ranges are wide enough to account for condition. The current POG valuations are way off the market, so the pricing guide should either be scrapped or updated.

I wouldn't bank on a "recovery" in coach values, but the pricing guide could be adjusted upwards in that unlikely event. These are depreciating assets under the best of circumstances.

At the end of the day I believe that we are living through a deflationary event, high end coaches are not immune. If you own a coach forget about the valuation and drive the wheels off the thing, I sure miss ours.

[0533]

Maybe I do not fully understand the rational behind the need to create a new market valuation chart on our buses, why do we need to share with the rest of the world that our buses are worth less than last year.

The largest Prevost converter Marathon appears to have at least 18 new coaches and about the same Certified Preowned 2008 to about 2004, which I believe are their trades. maybe $25M in cash tied up, lots of $$

If this is the case and the market is about 50% off or more on RV sales right now, Marathon possibly has enough inventory for the rest of 2009, They may buy 15 or 20 shells to have for custom orders but I bet not much more.

If these numbers are anywhere near accurate then the next few years at Marathon and the top 3 or four converters will be the same.

These converters will have to change direction and quickly to stay afloat for the next few years. They will reduce new sales down to a handful until the market returns, create a sellers market on new coaches, increase the value on used coaches. If these companies want to survive they must sell both new and used for higher prices with fewer units. The big three will become better used coach salesman and will need to hold the prices up to stay in business.

I want to ride their coattails and let them set the market pricing not us. I for one would not want to see a pricing change or even a pricing guide. Let the market handle this.

Please help me here, am I missing something or is there a compelling reason or value to each POG member to communicate the fact that our bus values may have taken a hit, help me on this.

The converter industry went to great lengths to be delisted in NADA, Kelly, Edmunds and others, why would we want to create a new downward valuation trend, it makes no sense, it's not like we required to file a report each year.

Lets at least table this nonsense for the next 12 months and see how this all shakes out.

[phorner]

The way I see it, my bus is only worth whatever someone else is willing to pay for it, and then, only when I'm ready to sell. Until I actually sell it, I haven't lost anything, except perhaps on a balance sheet.

The good news is that the Prevost busses represent a very small percentage of the RV industry on a whole, so I see that as an advantage. There are only so many to go around, and the used bus factory is closed.

The bad news is that the potential buyers are either holding onto their money or can't get financing, although financing IS available on a somewhat limited basis.

I am not seeking a buyer, so I can afford to take a wait-and-see approach.

However, I agree that nothing good comes from de-valuing our Prevost busses based on some arbitrary "market" value that will undoubtedly change anyway, ultimately based on demand.

My plan is to simply enjoy the lifestyle that so few get to actually experience.

Cheers, :)

[ajhaig]

It's not a closely guarded secret that coach values are down and perhaps we are putting too much weight into the importance of the POG Pricing Guide.

If Jim wants to maintain his credibility within the Prevost conversion community then the prices should be consistent with the current market values, they shouldn't be someone's attempt at forecasting what future prices will be. I can say with a high degree of confidence that the POG Pricing Guide for older vintage coaches is off by about 50%.

The two biggest converters are privately held so I have no idea what their balance sheets look like, but if they are at all leveraged I have a hard time seeing them survive this downturn in their current form. I hope they do survive because I plan on buying another coach at some point.

[Ray Davis]

I hope they do survive because I plan on buying another coach at some point.

That's wonderful news! I hope we get to see you guys (and the Red Storm) again at some time in the not too distant future!

Ray

[Kevin Erion]

I agree with Bruce, should we be the ones to put in print that our bus has dropped 50% in the last 12 months. I don't believe that is the case with all units! Let the water seek it's own level and we should not force it in any direction.
If you need to sell fast, you will drop the price. If you take care of your bus and don't have to unload it in a big hurry, the informed buyer will appreciate the TLC and pay more for that.
If something must be done with the price guide, make it go away, you can always bring it back under more favorable times.

[ajhaig]

Ray,

I can't tell you how much I miss the bus. Every once and a while I see one on the road... it's killing me!

AJ

[Alek&Lucia]

The current POG valuations are way off the market, so the pricing guide should either be scrapped or updated.

I think we should go for "the leave the prices as they are, since they reflect the market, as within the parameters of original cost of construction and supply and demand. There will always be folks on the street, that are willing to take a great cut for their rig, due to personal financial current situation, but I do not believe that someones lack of fluid cash should be forced on all the rigs on the road.
Remember, you have to take into consideration, many factors, eg. original price, age, all the upgrades, gadgets, and current condition, We keep our rigs in tip top shape, some in better condition that when they left the original converter (mechanically), so why should I sacrifice the value of mine, because someone else is having a financial (bust year) or vise a versa.
If we continue the original thought, our rigs, will soon be worth same or less than plastic.
I have nothing against plastic, since I also started that way, but I used to live in a marginal neighborhood in Chicago a long time ago, compare that to you get what you pay for, why should I cheapen the best (I feel that there is no reason to do so.)
The prices will go up. This is from our 25 years experience in prices of recreational Real Estate Market.

Alek

[truk4u]

I don't quite understand all the hoopla over the pricing guide, no one pays any attention to it anyway. Do you really think the Converters, Banks, Insurance Companies and Buyers actually rely on the POG Guide to set values?:(

You can hug your bus everyday, but the bottom line, is the market will drive the prices and they are what they are. If you think it's bad now, just wait!:eek:

[JIM CHALOUPKA]

Glad your coming back in AJ.




On the price list;

I also think that if there is going to be a list, then it must be accurate, or it looses credibility.

In this market if there is going to be a list it needs to be authenticated more frequently than yearly. Perhaps every 30 days is more like it.

One of the best parts of the list is the + & - adders and detractors.
If there must be a list, it could be made more vague so that a prospective buyer could compare one converter against another in relative terms, rather than with specific dollar amounts, it would be more relative to the times.

Certainly anyone in POG that reads the posts, attends the Rallies, and is seriously interested in buying a bus, knows when he sees a bus for sale that is priced right, and when it is not.

Every bus is somewhat different than any other. When a buyer sees the bus he wants (must have) he will buy it (if he has the money) regardless of where it is on the price list.

Buses are like realestate. A buyer, or seller, needs to study the market, and to compare sales prices and listing prices. After all that is the way the price list will be compiled anyway.
Presently these prices are more volatile and change more frequently than in the past.

Unless the list is kept current and up to date I recommend no list!

JIM

[jonnie]

Look guys, I don't own a Prevost, I am just a wanabee. However, I do know that the "book" never bought anything as far as I'm concerned. There is an ass for every seat and it is only worth what someone is willing to pay and you are willing to accept. That is the "market". All this may change in this new world we live in, but until it does buyers and sellers make the market and the price. If you don't like the price don't sell or buy.

Roger, chime in here. Your business is the prime example of this.

[rfoster]

Amen Johnnie, your right on.

Personally I never could get behind the pricing guesstimate that was on POG, cause the guy that came up with it lacked in credibility as to actual buying and selling experience. We referred to such activity as a pen hooker at best.

Forget about it. Pricing guides such as Nada, Black book, Kelley, Edmonds, and who ever else you can think have been so far out of wack the last six to eight months, it has been disastarous to those dealers using books to "buy" by and then they can't sell for a decent profit to survive. Leave the Prevost to the market place. No price guide!!!

But as our new President has indicated, profits are not what he thinks we should be working for? And Pelosi wants you to eat a lot of Tuna. And Pittsburg paid the refs.

That should draw some fire.

[rbeecher]

Roger,

Why didn't you run for President? You are right on every count!

Richard
02 Marathon XL II 45
96 VOGUE XL 40 For Sale, too good to give away!

[garyde]

When I was looking for my Bus, I looked at a lot of RV websites at Prevosts, I went to RV Shows, I spoke to Dealers. There was no unbiased resource out there. Salesmen and people selling their coach is not a reliable guideline.
POG helped me confirm baseline pricing. That was very helpful.
POG had no dog in the race. It was helpful and one of the reasons I originally joined.
Whatever Price guidelines say, they are still very general and flexible. At some point, it needs to be updated.

[rickdesilva]

All your automotive pricing guides are based on historical transaction prices. NADA for example compiles both wholesale (auction) and Retail transaction prices (from dealers). The only consistant item with prevost evaluations is the shell and the variable becomes the converter. I don't know of anyone consistently compiling and analyzing high line bus transactions. The numbers are so limited and the difference between converters and installed assessories is so wide that anyone attempting to create a price guide especially in this business atmosphere is nothing more than a "gut" feeling. I think some owners are "firesaleing" coaches to raise cash, a sale like that doesn't really represent the true value of the coach. So until someone has access to accurate info its best to do nothing and let the marketplace dictate prices.

[Jon Wehrenberg]

If you are not buying, and you are not selling the "value" of a coach doesn't mean diddly.

If you are buying the only thing that counts is if you are willing to trade some of your money for a coach. If you would rather have your money than a specific coach then either the price is too high or the coach is not what you want at any price.

If you are selling the price is what someone is willing to pay. You can ask for any amount of money, but the value is established by the buyer.

The only time "market price" has any significance is to a lender who needs to know the bus is sufficient security for a loan, or that it is insured adequately, or that it is properly valued for a personal balance sheet. The "market price" is what the coach price was agreed upon by the buyer and seller.

The only time it is fun to discuss values is when someone with a mega-buck plastic coach expresses a desire to own a Prevost, but opines that he cannot afford one. At that point it is fun to explain just how relatively inexpensive a good used Prevost conversion is. The only thing we can't say anymore is how well they hold their value, but then neither can the folks owning plastic palaces say that.

[0533]

The pricing guide is a bad idea that has no intrinsic value to any POG member now or even in the future.

Buyers who become interested in the notion of owning a bus will shop all the big names, get all the pricing information, evaluate his top 3 or 4 picks then negotiate.

We make a big deal about how our buses are different from the so called plastic coaches, why not allow for some additional mystique in the pricing.

I do not personally feel that the guide, if not updated or better still if not there will adversely affect Jim from gaining new members or new advertisers. It might in fact help.

When I made my purchase, made my offer the end selling price was what the seller would accept not a result of any arbitrary guide.

[jello_jeep]

I don't know about that, buy a bus, hold it for 10 years, and see what happens to its value :)





Buses are like realestate.

JIM

[Joe Cannarozzi]

Well seems to me, lately, they both would be worth less:o

[0533]

A price guide is the equivalent to a self fulfilling prophecy.

What are diamonds really worth??

[Jon Wehrenberg]

Anybody want to bet that if the price guide showed the values going up everybody would be insisting the guide to take a prominent position on the web site. but when the news is less than good everyone wants it to go away.

The bus is a toy and as such it depreciates. It is not an investment. It not only loses money every year (in value) it costs a fortune to maintain, not mentioning the stuff we add to keep apace with the Joneses. Who cares whether there is a value guide or not?

The only thing I ever owned that went up in value besides real estate or some investments was a plane and that was because they stopped producing them for years. When the supply became limited, the values increased. Perhaps there is some truth to the law of supply and demand?

[Coloradobus]

Rough times in Junction City


Wells Fargo sues Country Coach for $8 million, asks that receiver be appointed for company
Greg Gerber posted on February 02, 2009 14:16
COBURG, Ore. -- RV Industry News has learned that Wells Fargo has sued Country Coach for nearly $8 million alleging a breach of contract over a credit and security agreement dated May 18, according to documents filed Jan. 28 in the federal court in Oregon.

According to the complaint, Wells Fargo is seeking immediate payment of all sums due and Country Coach has agreed to the appointment of a receiver to evaluate the company and work with Wells Fargo to secure payment. In other words, Wells Fargo appears to be forcing Country Coach into bankruptcy, although no case has been filed with the bankruptcy court.

Court documents note that Country Coach is "no longer manufacturing recreation vehicles."

Wells Fargo claims it now owns a security interest in all Country Coach patents and trademarks as a result of the May 18 agreement.

Under the terms of the credit and security agreement, Country Coach and Riley Investment Management agreed to grant Wells Fargo a first-priority security interest in all Country Coach property and bank accounts as well as items contained in a "lock box." According to the terms of that agreement, Country Coach is required to direct all proceeds received from personal property collateral to the bank account maintained by Wells Fargo and subject to a lockbox agreement.

On Nov. 3, Wells Fargo notified Country Coach that it was in default under the agreement to meet certain financial covenants. Wells Fargo claims it gave Country Coach "ample time to locate alternative sources of funding." However, no acceptable sources of funding have been located.

In the initial complaint, Wells Fargo seeks $7 million in outstanding principle and interest, $889,000 in letter of credit obligations, $32,000 in merchant credit card obligations and other costs and expenses.

According to the document, "Country Coach has consented to the appointment of a receiver to address an event of default" pursuant to terms of the credit agreement. Wells Fargo claims the company engaged in numerous events during the default period which justifies the appointment of a receiver, including:

Country Coach received $760,000 in a settlement with Owens Coring in a separate legal action. That money was to have been deposited in the lockbox, but Country Coach has been accused of spending $500,000 of that money without Wells Fargo's knowledge or consent.
A federal court in Texas garnished Country Coach's bank account for $497,611 on Dec. 19 as part of a judgment against the company.
Country Coach's landlord commenced eviction proceedings Dec. 22 for failure to pay rent, although earlier news reports today suggested that debt has been paid.
But, on Jan. 23, the landlord notified Wells Fargo that Country Coach had failed to pay gas and electric bills, and that the service to the company had been discontinued. Wells Fargo claims Country Coach still owes more than $150,000 to get utilities reinstated.
On Jan. 21, Country Coach sold two motorhomes, but has failed to turn over receipt of the proceeds to the bank.
Wells Fargo has asked the court to issue a temporary restraining order barring the company from using, disposing of or otherwise taking action with respect to the collateral without the court's approval.

Country Coach officials are not available for comment. Nobody answers the phone at corporate headquarters and key executives have yet to return messages left by voicemail and e-mail to RV Industry News.

An Oregon television station reported today that the company is expected to issue a press release this afternoon. RV Industry News will post that release as it becomes available.

Posted in: Manufacturing News

[Petervs]

As for the price guide, how about a simple disclaimer at the beginning as follows:

This price guide was created in 2006 ( or whenever is correct) and reflects our estimate of prices at that time. It is an attempt to provide the reader with some insight as to the relative values of Prevost coaches by various converters through the years. Since the national economic crisis began in 2008 these prices should be used as a relative guide only. There is not enough historical data available since the economic changes began to provide accurate current prices.


At some future date was can always revisit this topic. Saying nothing makes us look like we do not know what is going on. Saying anything else might be premature, who knows what the bus market might be like in a year?

[garyde]

Your all correct. These are very unusual times. It will take some time for the dust to settle. All Values are skewed downward at this time, not just Prevosts. Hopefully the cycle will bottom soon.

[Coloradobus]

Country Coach officer describes deals made
The RV maker’s chief financial officer answers questions about buying land for its CEO and trading motor homes for payments

By Tim Christie

The Register-Guard

Posted to Web: Tuesday, Apr 21, 2009 10:56PM
Appeared in print: Wednesday, Apr 22, 2009, page A5


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News Updates: Photo
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Kevin Clark/The Register-Guard

Country Coach resumed production earlier this month after idling its plant for more than four months. The company is reorganizing its financing under Chapter 11 bankruptcy protection from its creditors.

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News Updates: Story
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Country Coach bought a half-*million-dollar piece of property for its CEO in 2007, gave creditors and landlords RVs in lieu of payment and operated without liability insurance for its directors and officers for about a month last winter, the company’s chief financial officer said Tuesday.

Chief Financial Officer Mark Andersen spent the day at the U.S. Courthouse in Eugene answering a battery of questions under oath from Rebecca Kamitsuka, attorney for the U.S. Trustee’s Office in Eugene, and from creditors.

Country Coach is in Chapter 11 bankruptcy seeking protection from creditors while it reorganizes its finances, and Tuesday’s meeting was part of that process. Kamitsuka, representing the public interest, questioned Andersen in detail about the company’s operations, finances and plans for emerging from bankruptcy, and invited creditors to do the same.

The company’s Junction City RV factory closed in mid-November, putting 500 employees out of work.

The company entered Chapter 11 bankruptcy in February after creditor Wells Fargo moved to seize the company’s assets.

Earlier this month, a bankruptcy judge approved a complex financing plan in which Wells Fargo will give the company access to a $3.2 million revolving loan fund to allow it to carry out a plan to sell its coaches directly from the factory, rather than through a dealer network.

Production has resumed with a work force of 100, who are turning out one coach per week — a far cry from the company’s peak in 2006, when it employed 1,800 people and cranked out 16 coaches per week.

Under questioning by Ed Morgan, CFO of Guaranty RV, a Junction City RV dealer, and by Douglas Schultz, an attorney for the unsecured creditors’ committee, Andersen said the company spent $500,000 on a piece of rural property on Clearingside Drive, off Territorial Highway about 5 miles west of Junction City, and gave it to CEO Jay Howard.

The property deal was part of Howard’s compensation plan negotiated after new owners bought Country Coach early in 2007, he said. As part of the agreement, Howard signed a noncompete agreement in which he promised to stay at Country Coach for at least two years, said Thomas Hunts*berger, a bankruptcy attorney representing Country Coach. The company agreed to buy the Clearingside property with Howard and, if he stayed with the company for two years, Country Coach would give him the property, he said.

County property records show that Howard and Country Coach jointly bought the 39-acre piece of property, including a 1,200-square-foot farmhouse built in 1928, for $500,000 in June 2007, four months after new owners bought Country Coach. The Lane County Assessor’s Office assessed the property last year at $48,277 and estimated its real market value to be $164,549.

Andersen said that, while Howard’s name is on the deed, he did not contribute money toward the deal. Country Coach paid cash for the land, he said.

Huntsberger said when the two years was up in February, Bryant Riley, the company’s majority owner, executed a deed to grant the property to Howard, but he said the deed has not yet been recorded. It’s not clear if the deed was effectively transferred from Riley to Howard, he said. “It’s undetermined if the company still has ownership,” he said.

County property records, however, indicate that Country Coach transferred the deed to Howard several months ago. A quitclaim deed, dated Dec. 8 and effective Jan. 1, granting the property to Howard was recorded with Lane County on Jan. 5. The deed was signed by Howard, acting as president and CEO.

Huntsberger said after the hearing that he was relying on a title report dated March 25, and if a deed was recorded in January, “It’s news to me.”

Country Coach may have paid some employees to work on the property, including putting in an RV pad, Andersen said.

Andersen also said Country Coach traded coaches to Bob Lee and Ron Lee, principals of Lee Joint Ventures, the landlord for much of the Country Coach factory, in lieu of “several months” rent. Bob Lee is the founder of Country Coach but no longer is connected to the company.

Similarly, Country Coach traded motor homes to two vendors, API, a Eugene paint and industrial paint and finish company, and Aqua-Hot Heating Systems of Colorado, in lieu of payment, he said.

None of the parties at Tuesday’s hearing suggested the actions taken by the company were not legal.

Under questioning by Kamitsuka, Andersen said the company’s liability insurance covering the actions of directors and officers lapsed in February. Such insurance is common in the corporate world and provides protection to company officials in case they get sued in connection with their corporate duties.

In response, company officers “chose not to take authoritative action” on behalf of the company, he said.

“There was a general understanding people wouldn’t make decisions,” he said.

CEO Jay Howard remained in charge of the company, he said.

The insurance was not reinstated because bankruptcy law provides liability protection, he said.


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Comments
The Register-Guard doesn't necessarily condone the comments here, nor does it review every post.

Harrr L

04/22/2009 09:05AM
Why would You even retian Jay Howard ...let alone rob a cash poor company of $500,000 for a bonus.


J.RETIRED

04/22/2009 09:44AM
With all that has gone on with the Howards , I wonder how much of the "BENEFITS" that are listed in the above reporting has been looked into for State and Federal taxes or has even been declared?

Wondering

04/22/2009 11:19AM
The question I am wondering is why does a company so small need so many executives? If you look at their website they have 8 vice presidents and Jay as a CEO. So almost 10 percent of the company is made up of executives that seems a little on the high side to me. I can't imagine any of them making less the 50 to 60 k/yr. In fact when it was a public company I think the CFO Mark Anderson's salary was listed around 180k. Do you really think he took a 50 percent pay cut? That would still have him making around 90/k yr.

Once again it looks like the executives of the company are protected at the expense of the workers and vendors.


Jen-JC

04/22/2009 12:42PM
CC is not going to suceed until they can the Howards. They can build coachs all they want but who is going to buy them with the Howards Reputation around town? And will they honor the Warranty work? Not likely.

Word of mouth is the key in the RV business and they done blew it years ago! Jay can't even manage a Marriage and his Family, let alone a Company!

LLPOF

04/22/2009 12:52PM
Did you notice that three of those executives are named Howard? Do you suppose they are related? How much interest does the CEO have in helping CC to survive now that he has fufilled his contract and received his piece of property? Hmmmm

If Mr. Anderson was making 180K, does anyone really think that the CEO or his family was making less?

Most of these executives were at CC while all the workers were layed off. I have a feeling that they were not working for the good of mankind, but rather for those large salaries and benefits.


braheem

04/22/2009 02:20PM
Howard and Country Coach jointly bought the 39-acre piece of property, yet Howard did not contribute any money?

Country Coach employees may have worked on this property...

all the while employees are getting laid off?

Something (someone) really stinks !!!

OregonWoods

04/22/2009 03:17PM
<quote>I wonder how much of the "BENEFITS" that are listed in the above reporting has been looked into for State and Federal taxes or has even been declared?</quote>

I would be willing to bet this is exactly WHY the bonus was given in the form of property rather than cash. The financial "hit" would be much lower with this arrangement.

Also, real estate law protects land owners, especially if that land has a home on it, and the owner happens to make that home their primary residence.

smells fishy

04/22/2009 06:00PM
Hmmm...... I used to work at CC till 12/07. I don't remember the employees getting any kind of bonus in 07.

[rahangman]

Hmmmm if a bus is valued at time of purchase for lets say, $200K a year ago and that is what the Insurance Co determines your insurance rate in LewDollars or any currency, then what if there is a reconsideration for Insurance Cost due to the devaluation (and obvious replacement value). Does the Insurance company defy all market indicators or does the owner reap the harvest of decreased insurance costs? l

[Joe Cannarozzi]

I would assume under the current economic conditions that is rapidly devaluing our buses it would be both prudent and up to the owner to keep in contact with the insurer so that overcharges and subsequent problems due to any potential future claims because of such will be avoided.

A yearly reassessment of market value does not seem unreasonable.

[lewpopp]

As your coach depreciates so does the value to the insurance co devaluates. They will only cover you for equal value in the market for your coach in a total loss.

I insured my coach for a much lesser amount and saved a ton. You cannot get 300K for a coach 15 years old no matter how much you love it.

[mikedee]

I pay a premium based on an agreed coach value of $325,000. The coach was worth that and if lost it would take time and effort to replace.

I choose the agreed value option to solve the value $ problems with an item that has no book number. My tools, guns and other collectibles are also insured at agreed value. I was robbed once and lost a great deal of property, then I lost a great deal of money on the settlement.

[mwalker422]

I went on a tour at Country Coach and Marathon last week. Country Coach just openend back up this month. They had two new shells. One XLII and one H3. I got the impression they were trying to get someone to take the shells. Conversions are out of the picture now. They are finishing up the motorhomes (not conversions) that were started before the shut down. I was told if they put out one coach a week they could make it. I hope they make it. They were nice to us.

Marathon was slow but looked like they were in better shape than Country Coach. Phil Cornelius showed us the whole process. It difently is a first class operation and I'm sure they will come out OK.

[garyde]

I recieved a letter from Country Coach a few days ago. Jay Howard, CEO, describes the new company and the factory direct business . A few 08 and 09 Coaches left and a limited quatity of new 2010's. Hand crafted, patented verandas, custom design , etc. I wish them well.
The problem now is there are so many Coaches for sale, and so many repo's, I don't think there are too many people who want to buy new.
Hopefully, there is a few people who are willing.
The letter did not mention Conversions.