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I passed Buddy Greggs place this week in Knoxville (didn't stop) easy to see from I-75/I-40, looks like he is still plenty stocked up on plastic .
Wonder what is up with him since CC is selling direct?
There may have been two XLIIs in the second row.
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Buddy Gregg probably owns those RV's and Coaches or Country Coach owed Buddy Gregg , so they took inventory in trade.
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What is wrong with this picture, unless Riley dumps some serious $$ into CC I do not see the light, unless these coaches cost much less to build than I think? If you read this, what do you think the chances of success are on a scale of 1-10 based on the numbers. if you were Riley, would you want to inject more cash to above the available $3M available to operate the place for one year. Good exercise, keeps the mind alive, lets get feedback, will they make it?
Here is what the article said: Abbreviated version:
News Updates: Story
Wells Fargo Bank has agreed to loan Country Coach up to $11.5 million so it can build up to 43 coaches during the next 10 months.
The new loan includes the $8.5 million that Country Coach already owes to Wells Fargo,
The company has no significant operating funds, no ability to borrow under any other terms, and faces the prospect of Wells Fargo pressing its effort to liquidate the company’s assets if the deal is not approved.
It’s complicated because the agreement involves not just Country Coach and Wells Fargo, but also Riley Investment Management, a company controlled by Los Angeles investment banker Bryant Riley. Riley is the majority owner of Country Coach but he’s also a creditor: Country Coach owes his firm about $15 million, according to court documents
Howard said the company has 15 unfinished coaches on the production line, and another 15 chassis ready to be built.
So it appears they have 30 unfinished and shells of the projected 43 units they need to sell
Country Coach plans to start selling coaches starting next week at a rate of one to two per week, for a total of 43 coaches by the first week of January.
Wonder who came up with this number, a salesman I guess, wishful thinking, I am sure there are lots of willing customers who want to purchase a coach that has been sitting half finished on the floor for months, and pay full price for the privilege, I would love to see these projections
The budget calls for Country Coach to spend $20.3 million over the 42 weeks, of which $18 million will be for operations and $2.3 million will be for bankruptcy expenses. During that time, the company expects to collect $23.5 million.
So Riley is willing to place another $17.3M out of his pocket???
The company also plans to eliminate obsolete floor plans and streamline its existing model line. Country Coach now offers eight different models, ranging in price from $300,000 to $1.8 million.
This is an interesting business plan for sure.
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Bruce:
Shame on you. Who do you think you are applying finite math and common sense to this? :rolleyes:
Good break out on this. I agree that this presents a picture of a strange business plan. I also don't consider most reporters to be capable of understanding and accurately reporting the contents of a business plan or a balance sheet.
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Bruce,
I'd say that their chances are close to zero.
Their underlying business model is contingent on credit availability to the consumer. 20 year financing on an product that depreciates so quickly combined with the fact that these units really don't have a 20 year life... It's right up there with the "liar loan."
The Fed has loosened credit as much as they can, but the capital markets are still very tight.
AJ
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I think they will fail for even more fundamental reasons. There is absolutely nothing that has changed from when they went in the toilet in the first place.
Every bankrupt business I ever took over had glaring problems that Stevie Wonder could see. Make those problems go away and run the core business efficiently and the losses turn to profits.
With CC I never see anywhere that someone is addressing the problems that got them in financial distress in the first place.
In today's environment I don't think even pricing a product of that type below cost will increase sales. People that were buyers have watched their investments suffer huge loses, people that are borrowers have all of a sudden started exercising some common sense along with those that lend money on depreciating products, and a lot of dealers are likely having second thoughts about loading up on inventory.
Why would the folks that control CC all of a sudden think they can make it survive?
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Jon on track as usual
Jon, you are hitting the nail on the head. How does CC expect to perform now with so many other variables in the toilet since last year? Does this sound like our fabled Auto Industry and their retention of the same Management Class that has driven them to our Free For All loans. How can we expect those who fostered and put into play the Bad the last several years, to now all of a sudden be able to do the Good? Should they not have been doing that to begin with? Just my humble thinking.
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I think the current CC conversion owners should take full advantage of this situation and get every single piece of information about their coaches that is available.
They should find sources for the proprietary stuff, they should get the schematics, even if they have to convince the management to sell it to them. I know in the past the CC owners have held out hope that the company refurbishing CC coaches in Oregon will pick up the slack, but I think that is wishful thinking. And when CC finally dies (and it will) and assets start getting sold the information which will help them retain coach value will literally be gone forever.
I have had the responsibility of liquidating two companies. The hard assets are sold. The intellectual properties that are patent protected and have some value are sold. Other information such as purchasing records, vendor lists, most engineering documents, specialized inventory work in process are all scrapped. That is the valuable stuff and CC owners right now should be working to secure that information. If it is not saved future repairs are going to be a bitch.
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Jon I had a dream last night that you bought and were camping a CC. You and Rodger snuck around the campground removing bling from the Libertys:rolleyes:
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That is no dream, that would be a nightmare for Jon.
Besides he was out hunting Easter Eggs.