By Linda Lipp, Greater Fort Wayne Business Weekly
Northeast Indiana’s RV, travel trailer and manufactured housing industries are gearing up to provide shelter for the estimated 1 million people left homeless by Hurricane Katrina.
Gulf Stream Coach in Nappannee was contacted by the Federal Emergency Management Agency last Tuesday and rolled several dozen trailers off its production lines the very next day, said Steven Lidy, director of marketing.
The units were trucked immediately to the Norfolk & Southern rail yards in Elkhart to be transported south to the disaster area.
Gulf Stream is hiring an additional 200 workers to ramp up its production, but that’s not just because of the hurricane. The company already had expanded its plant and was planning to add to its work force to keep up with the growing demand for its products.
“This just pushed it to a higher level,” Lidy said.
The increased demand for their products may be a boon to the manufactured housing industry, hurt by financing issues; and the RV and travel trailer industries, which have been feeling the pain of higher gas prices.
“It certainly is a boost, although it’s not (a reason) we hope for,” said Bruce Savage, vice president of public relations for the Manufactured Housing Institute in Arlington, Va.
Elkhart-based Coachmen Industries — which this spring cut 10 percent of its hourly workforce and more than 12 percent of its salaried workers due to slumping sales — also is in talks with FEMA to provide travel trailers and other units for use as temporary housing for hurricane victims, said Jeff Tryka, director of investor relations.
After the Florida hurricanes in 2004, Coachmen supplied FEMA with hundreds of trailers it already had in its inventory and then turned to production of special, stripped-down units built to FEMA specifications for basic, emergency housing.
It’s too soon to tell whether Coachmen will be producing units for FEMA this time around and whether that would require the manufacturer to call back some workers who have been furloughed.
“Obviously, this is really soon in the process,” Tryka said.
California-based Fleetwood Enterprises, which has plants in Decatur and Garrett, expects to bid on FEMA manufactured housing contracts, said spokeswoman Kathy Munson. That may not have an impact on its area operations, however.
The plant’s Decatur plant makes high-end diesel RVs — not the type of basic housing FEMA wants. The Garrett plant makes manufactured housing, although units shipped to the disaster area are more likely to be made at the company’s plants in the southern U.S.
“Then again, after the Florida hurricanes, we shipped units to Florida from Texas, so who knows?” Munson said. “Initially, they probably are looking for whatever dealers and manufacturers have in inventory.”
One RV dealer already involved is Ron Sleeper, co-owner of The RV Center in Columbia City. Sleeper and his business partner, Steve Hess, were contacted for help last week and have earmarked a dozen travel trailers they expect to ship to related dealerships in the south.
The units could be on their way in just a few days. “My partner and I were even talking about possibly going down to assist personally,” Hess said last Thursday.
Ironically, Sleeper was in New Orleans just a month ago at about the same time another hurricane was threatening the city. He spent three days at a dealer show in the Superdome, and as he has watched footage of the devastation, “It really has hit me,” he said.
The mobilization of the housing industries will happen in two phases, Savage said last week.
“First, they’re looking for homes that are immediately available … anything that is currently existing and can be moved in quick manner,” Savage said.
That includes RVs and trailers that can be used as temporary housing, as well as manufactured homes.
“We’ve been sending out messages asking, ‘What do you have available and how soon can you get them there?’’’ Savage said.
Trailers and RVs can be delivered in as little as a few days. As of last week, however, FEMA had not designated staging areas for the temporary units to be moved to.
“It’s a logistical nightmare,” Savage said.
The towable RVs produced by Coachmen, for instance, can house a family of four to six people. They use propane for cooking but need water and electric hookups. And much of the area is still without both.
RV Wholesalers, in Lakeview, Ohio, issued a plea last Thursday for drivers to haul trailers to the disaster area. The company has been contracted by FEMA to deliver the trailers, and is looking for people with vehicles that have at least a 7,500-pound towing capacity. (Those interested in helping should contact the company at 1-877-877-4494.)
Drivers also should have liability coverage that will cover their vehicles because the company’s insurance will only cover the trailers. Delivery of the trailers to Mississippi, Louisiana and other locations is expected to begin immediately.
The second phase of the rescue and rebuilding effort will be to ship manufactured homes to provide longer-term housing.
“The industry, by its nature, doesn’t keep a large inventory,” Savage said. But once an order is placed, a unit typically can be built in as little as two weeks.
A little retooling or reorganization of production lines would be required to build the more basic housing FEMA usually buys.
“We have the capacity physically, but some additional people would be needed, and we have some layoffs in some areas we could call back,” Munson said.
Fleetwood supplied 1,700 manufactured homes and more than 1,000 trailers to provide housing for victims of last year’s hurricanes in Florida.
Wall Street responded to the anticipated hurricane-related demand for housing by driving up the stock of several of the companies in question. Coachmen’s stock price was up 14.8 percent in the first four days of last week, closing at $13.90 Thursday. Fleetwood’s stock saw a 16.6 percent rise, to $10.33 Thursday; and the stock of Auburn Hills, Mich.-based Champion Enterprises, the largest modular home builder in the U.S., was up 21.9 percent, to $13.50.
Copyright 2005, KPC Media Group Inc.