Newmar layoffs

[sheridany]

A well placed source in the industry told me that Newmar laid off 10% of their workforce today. No numbers given just a percentage. Sure enough a news outlet said the same.

Nappanee RV company reportedly lays off 10 percent of workforce

A Nappanee RV company has laid off workers. Newmar employees tell us about 10 percent of the workforce was let go today. The company says it does not comment on specific details concerning staffing or production issues, but it did say it continually monitors and adjusts activities to reflect...

wsbt.com

Hard to tell if this a reaction to the market slide this week and a anticipated tougher earnings road ahead or something else. What a week it’s been.

 

[TJ&LadyDi]

I wonder if this could be related to the coming transition from 2020 models to the 2021s? If most of the 2020 units have been completed and the 2021s won't start production for a couple of months, this may just be a temporary situation.

That said, the economy seems to have one foot in a hole and the other on a banana peel. If the COVID-19 situation takes a bad turn, there is a potential for a serious recession like 2008-2009. That could also be a consideration.

TJ

 

[redbaron]

Supply chain issue are a real problem. One of my clients had to shut down due to the inability to get masks for their workers. They have a highly dusty environment, and the filters they must wear on the floor are no longer available due to shortage.

Electronics and other manufactured goods from China are not being shipped or produced from the majority of the factories.

All this brings uncertainty. Wbgo/newmar have good justification to act quickly. Layoffs are almost routine for newmar and other RV manufacturers.

2019 DSDP 4369 * Active Air * NHSO

 

[TJ&LadyDi]

Excellent points, @redbaron!

TJ

 

[Jim]

Parts delivery could be a real problem, and that is probably the answer. Apple was concerned earlier for the same reasons, although I understand that Apple's CEO stated yesterday that there will be no disruption.

Or... it could be Winnebago taking the Newmar brand down instead of letting the Newmar's superior manufacturing procedures bring the Winnebago brand up.

 

[sheridany]

My gut says it’s partly a reaction to the environment events like supply chain as @redbaron points out but also the new norm of operating as a subsidiary of a conglomerate coming into play.

Winnebago has expectations about margins and contributions to revenue to meet the markets expectations of earnings per share.

As a possible example, the dealer meeting is in Indianapolis this year instead of Florida or Texas. This is much closer to home and lower cost to set up and run. I could be misreading it and it was a planned event anyways.

I believe that Newmar will continue building a quality coach and being service oriented compared to the competition. They just have to execute more efficiently.

With the economic and global pandemic fears, it’s just hard to tell. We will see as the year progresses.

 

[Akdare]

The article references “10%”...how many employees does Newmar have?

Would be interesting to know what departments were affected...production, management, marketing, supply chain, etc. could be demand, or the new organization pruning some redundancies, or a combination.

 

[RKins]

My gut says it is what typically happens when a company buys another - they lay off 10% at the purchased company to show a bump in profits - shows the share holders that the merger was a good idea. Has happened at every company that I worked at that was purchased by another. And it could also have something to do with what was mentioned above.
Akdare, Newmar had over a thousand employees.

 

[AbdRahim]

Even though there is some seasonality to this business, this reflects the difference between a small family run company and the giants in Corporate America. In the former, the employees are like fami9ly. In the latter people are often simply expendable commodities.

 

[yblaw]

The article references “10%”...how many employees does Newmar have?

Would be interesting to know what departments were affected...production, management, marketing, supply chain, etc. could be demand, or the new organization pruning some redundancies, or a combination.

While at Newmar for service last fall, I was advised by Newmar personnel that the company had about 1,100 employees at that time......

 

[Neal]

Any word on number of units per day production and if affected? Are they still maintaining the same numbers?