Monaco Coach Corp. is dead. Long live Monaco RV LLC.
The new Monaco RV LLC hit the ground running on Thursday (June 4), its first day in operation under ownership of Navistar International Corp.
Today, managers will begin contacting former MCC employees, who had been laid off sometime in the past year, to staff production facilities in Oregon and Indiana
In anticipation of Thursday's closing, Navistar placed a full-page ad in Wednesday's Wall Street Journal.
"We're proud to welcome Monaco RV into the Navistar Family," says a large ad over a large headline that says, "Now We've Got all the Roads to Number One Covered."
The 41-year-old RV maker, based in Coburg, is now a wholly owned subsidiary of Navistar International Corp., an Illinois company that builds diesel engines, school buses, heavy trucks and military vehicles.
Navistar announced Thursday that it had closed the deal to buy Monaco's assets, including plants in Coburg and Harrisburg, and in Wakarusa and Milford, Ind., as well as its inventory, brands and intellectual property.
In a news release, Navistar said the new company will be called Monaco RV LLC and will have its headquarters in Coburg. Navistar said the new company "will resume production at certain facilities in the coming months," depending on market conditions, but offered no more details of its plans.
The company, founded in 1968 in Junction City, ceased production last December after a brutal 2008 in which it was battered by record-high gas prices, the financial meltdown on Wall Street, tight credit and woeful consumer confidence. It filed for Chapter 11 bankruptcy protection in March and laid off about 2,000 workers.
Monaco and Navistar have a long-running business relationship. In 2007, Monaco and International Truck and Engine Corp., a Navistar subsidiary, formed a joint venture called Custom Chassis Products LLC to build rear-engine diesel chassis.
"It takes a special company to become part of our portfolio. Monaco RV is certainly that. The number one producer of luxury recreational vehicles, Monaco RV joins our other category leaders: International Trucks, IC Bus and Navistar Defense. Together, along with our MaxxForce engines, parts, service and finance offerings, they further our mission to be the transportation company in the world. Something that separates our company from the competition. Which is why we're particular about who joins us on the road to fulfill our vision."
Monaco RV LLC will be much leaner than the old Monaco Coach Corp., which was also based in Coburg. The new company will reportedly hit the ground running by making a number of key moves in the coming days, according to Monaco RV spokesmen:
The new business is under the direction of former Chairman and CEO Kay Toolson, who will report to Allen. Among the other returning Monaco executives is Mike Snell, now senior vice president of sales and product development, Charlie Kimball, now senior vice president of operations, and Richard Bond, senior vice president and general counsel. Pat Carroll, (product development), John Healey (purchasing), Garth Herring, (parts and service) and April Klein (customer service) are also part of the Monaco RV team, as is Marty Garriott, who will return to run the Oregon operations, and Irv Yoder, who's back to oversee Indiana operations.
Former Monaco President John Nepute and former CFO Marty Daley will join Navistar in other corporate roles, but will not be a part of Monaco RV.
"We are going to produce models and brands that are in the most demand by our dealer body, but fewer than before," Snell said. "Our plan is to begin producing at a low rate at all of our facilities based on a smaller group of dealers and the business model we are adapting to."
Monaco spokesmen have also confirmed the following:
- Snell and his sales staff will begin visiting key dealers in coming weeks.
- Towable operations will be ramped up more quickly than motorized to take advantage of the key June-to-September buying season.
- The former towable-building R-Vision plants in Warsaw, Ind., about a half hour south of Wakarusa, will be leased for approximately 90 days or until work-in-process units can be completed there. Then, those operations will be moved up to Wakarusa in Elkhart County.
- Navistar reports that it has also acquired Monaco's Bison equine trailer operation in Milford in the purchase.
- Slated for sale by Monaco Coach Corp. in its Chapter 11 case are idled facilities that were not acquired by Navistar, including a fiberglass plant in Hines, Ore.; a chassis plant in Harrisburg, Ore.; the Nappanee Wood Products plant in Nappanee, Ind.; two buildings at the former Hively Avenue operations in Elkhart; a towable manufacturing plant on Mishawaka Road in Elkhart; the R-Vision complex in Warsaw; and the Roadmaster cargo trailer business in Goshen. The proceeds of those sales go to satisfy creditors of Monaco Coach, although it is presently unknown what percentage of these proceeds will be available to satisfy Monaco Coach Corp.'s general unsecured creditors, including dealers, vendors and customers who submitted unpaid warranty claims. Meanwhile, Monaco's resorts were auctioned off late last month, and the $16.3 million in proceeds was also applied to the debts owed to creditors.
Kay Toolson, CEO for Monaco RV, said, "The last few months have been very difficult, with many hurdles to overcome to complete the sale to Navistar. This result is the best possible outcome for our communities, employees, dealers, customers, suppliers and the entire RV industry. We are pleased and excited to be a part of Navistar."
Plans call for Monaco RV LLC to have a significant presence at this winter's National RV Trade Show in Louisville, Ky. However, again, Monaco's new business model clearly calls for a leaner operation in terms of physical plant capacity, employment and dealer rosters, Snell maintained. "The challenge we will have is, a lot of dealers and people on the outside will see this as the same Monaco, and it's not," said Snell.
Snell said that under Navistar's plan, Monaco RV is expected to be a self-sustaining and profitable business under Navistar's ownership.
Although the new company is not liable for any product sold by Monaco Coach Corp. prior to the purchase by Navistar, Snell indicates that customer service representatives will be available to aid RV owners in obtaining service and support for their vehicles. Owners with questions should call (877) 4MONACO for assistance.
In addition, Navistar's president and CEO, Daniel Ustian, has been on Monaco's board of directors since 2003.
Navistar, which generated $14 billion in revenue last year, employs 17,000 workers at plants in Ohio, Alabama, Arkansas, Oklahoma and Canada.
Navistar trades on the New York Stock Exchange under the symbol NAV. Its stock closed at $40.37 a share Thursday, up $2.32.
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