A bankruptcy judge has allowed Country Coach to restart its idled factory for at least the next two weeks so it can resume work a few luxury motorcoaches.
Judge Albert Radcliffe authorized the Junction City, Ore., RV maker on Monday (March 30) to spend up to $2 million through April 17 to begin carrying out its plan to revive its fortunes, with financing provided by Wells Fargo, according to Associated Press.
The plant and 500 workers have been idle since October, and the company has sought Chapter 11 bankruptcy protection.
Workers will get the factory organized and order parts and supplies this week, with production resuming next week at an initial rate of a coach per week, said Jim Howard, Country Coach’s senior vice president for sales and service.
The company will call back about 100 workers, he said.
“It’s a good result for everybody,” Howard said after Monday’s hearing.
Country Coach has about nine completed 2008-09 models ready to be sold, and about 40 coaches in the pipeline that would be sold as 2010 models, Chief Financial Officer Mark Andersen said.
The long-term outlook remains uncertain.
Radcliffe will decide in two weeks whether to give final approval to the financing arrangement between Country Coach and Wells Fargo.
The bank had sought to seize the company’s assets after Country Coach defaulted on an $8 million loan balance.
The bank and company officials agreed on March 20 to a plan in which Wells Fargo would give Country Coach access to a $3.2 million revolving loan fund. The company plans to sell its coaches to the public directly from the factory, rather than through a dealer network, as it has for years.