Best Use Of An Old Trailer?

GMC Motorhomes

I came across the ad at this website. Someone had purchased an old GMC Motorhome and had attempted to restore it. Unfortunately, the website that carried the story of their renovation is no longer active. The post which began the story, ends with this somewhat tragic observation:

The next few months would be challenging as we struggled with the reality of what lies ahead, and the costs of keeping a dormant RV around a dense city. The story will continue in my next post…

Sadly, the story never continued. Or at least I couldn’t find the ending to the story anywhere online. A failed renovation attempt?

The coach pictured above is a 1973 model produced by GM’s Truck and Coach Division. It was a 26-foot model powered by a 455 cubic inch, 7.5 Litre V8 engine with a three-speed automatic transmission. Front-wheel drive, with a gross vehicle weight rating of 12,500 pounds for the 26-footer.

Not many were built. Just under 13,000 units were manufactured between 1973 and 1978. I have read that somewhere between 8,000 to 9,000 of these motorhomes are still running. There is even a group, GMCers, telling the world all about the GMC motorhome.

I’ve seen the GMC motorhome in a couple of movies: Twister and Stripes. I’ve never seen one in the field.

You could take a GMC motorhome and really bring it up to date by working with Creative Mobile Interiors. I have no idea how much it cost them to renovate this 1977 GMC motorhome. The coach looks amazing inside and out.

I suspect the purists would prefer to remain true to the original model and have it look like this one:

Trade Wars Are So Much Fun

I caught this on CNBC:

Thor Industries’ warning about rising tariff-related costs in its third-quarter earnings report sent shares plunging to 2018 lows, but CEO Bob Martin told CNBC on Thursday that the company is finding ways to blunt the impact.

“We thought it’d be minimal,” the CEO admitted in a “Mad Money” interview with Jim Cramer. “Today, they’re still kind of all over the board and we’re just finding ways to kind of counteract them whenever we can.”

For Thor, the United States’ largest recreational vehicle manufacturer, that means cutting raw costs and “de-contenting,” or taking certain ancillary products and features out of its higher end RVs.

Thor’s stock has been under pressure since the Trump administration enacted steel and aluminum tariffs in May, which hike Thor’s costs by stymieing cheap imports.

That is an interesting word, isn’t it?

De-contenting.

De-contenting means that you pay the same price, or sometimes more, for less.

This might not be the best time to purchase a new higher end RV from Thor.

Of course, trade wars hurt on both sides.

The Canadian dollar has slid below 76 cents which will make our first winter south in retirement considerably more expensive.

Hopefully the politicians and the bureaucrats in Canada and the U.S. come to a reasonable compromise.

More RVs That Float. Really.

When I had posted that Winnebago had purchased Chris Craft, a boating company, I tossed out a joke that Winnebago was about to make RVs that float.

Turns out that somebody has already done that.

There’s something just not right about a floating RV.

RVs That Float

Interesting news release from Winnebago:

Winnebago Industries, Inc. (NYSE:WGO), a leading outdoor lifestyle product manufacturer, today announced that it has acquired Chris-Craft, an iconic recreational boat builder, from Stellican Ltd., which has owned Chris-Craft since 2001. Terms of the transaction were not disclosed.

With a brand heritage that dates back to 1874, Chris-Craft is an industry leader in recreational boating craftsmanship and quality. The business is poised to leverage its strong brand reputation and drive future growth through the introduction of new models and product lines, category extension opportunities supported by increased production capacity and expanded dealer reach.

“Chris-Craft is an iconic, premium brand that shares many similarities with our own heritage Winnebago brand, including a commitment to providing customers with the highest quality products and services,” said Winnebago Industries President and Chief Executive Officer, Michael Happe. “The company’s strong brand, high-quality product line and premium position in the marine market make Chris-Craft an attractive addition to our portfolio. Chris-Craft marks Winnebago’s first entry into the marine market, which we believe has significant runway for growth, with a large and increasing population of current and new boaters who enjoy extraordinary experiences on the water.”

Mr. Happe continued, “Importantly, this acquisition aligns with our strategic initiative to further diversify Winnebago Industries within the outdoor lifestyle market and gives us a strong base on which to build an additional revenue platform over time. We believe there will be synergies realized across our value chain and that the Chris-Craft business has material expansion opportunities available. Additionally, we see significant intersection between the RV and marine lifestyles and view marine as a natural adjacency to our existing outdoor lifestyle portfolio, with similar customer demographics and significant ownerhip crossover. With a broader, more balanced portfolio of products uniquely positioned across the outdoor lifestyle and leisure travel industries, we expect to continue to drive improved profitability and shareholder value over the long term. I look forward to working with the talented Chris-Craft team and to welcoming them to the Winnebago family.”

“I am delighted that Chris-Craft has found an ideal partner in Winnebago Industries,” added Chris-Craft Chairman and Stellican Ltd. Founding Partner, Stephen Julius. “Winnebago is a natural fit for Chris-Craft’s premium brand, with a similarly iconic brand, complementary cultures, and a shared dedication to design, craftsmanship, quality, and customer service.”

Financial details about the deal are limited although Winnebago made the following observations to their investors:

  • Undisclosed transaction value, expected to be paid with cash on hand and debt
  • Provides platform to drive expanded revenue growth opportunities
  • Transaction expected to be immediately accretive to fiscal 2019 EPS
  • Continue to expect to reach our goal of 1.5x or lower Debt-to-EBITDA by end-Fiscal 2018

Interesting to see an RV manufacturer diversify this way. Chris Craft is primarily focused on outboard and sterndrive boats although they do offer one cruiser, the Commander. Perhaps Winnebago intends to go further upscale and leverage common components in systems that tend to crossover between RVs and marine. They do note in the investor material that Chris-Craft’s current focus is primarily on 21-38’ boats. And that 90% of all boats sold in the U.S. are < 25’.