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Issues in the Arizona retail market played a major role in Class A motorhome manufacturer Rexhall Industries Inc. reporting lower earnings for the second quarter and first half of this year.

California-based Rexhall earned $132,000 during the three months ended June 30, a 63% decline from the year-earlier period.

During the first half of this year, Rexhall earned $251,000, an 81% decline from the $1.3 million the company earned during the first half of 2000.

Meanwhile, Rexhall’s second quarter sales revenue increased 20% to $18 million and its sales during the first half of this year climbed 2% to $36.7 million.

Rexhall’s share of the retail market for Class A’s increased this year to 2.4% from 2.1% a year-ago, added Michael Bourne, COO.

Difficulties in the Arizona market trace back to the bankruptcy last year of Rexhall’s biggest dealer in that state, RV Supercenter.

The bankruptcy of the multi-location RV Supercenter group led Rexhall to form a subsidiary to own and operate the Price One, formerly RV 101, dealership in Mesa, Ariz.

The Rexhall-owned dealership “started up too big, too quickly, and with the poor season (last year) wound up with too much inventory and overhead,” said Bill Rex, CEO.

However, Rex added, “We have made significant cost reductions in the last few months,” and Rexhall has hired a new general manager for its company-owned dealership.