Monaco Coach Corp. raised its wholesale prices from 2% to 4 1/2% at the beginning of April to offset higher costs for materials, particularly steel, company executives reported during a conference call with investment analysts last week.
The 4 1/2% increase was applied to Monaco’s “high-end” units, a 3% increase was attached to its towable products, and its gas-engine motorhome prices were increased by 2%, said Kay Toolson, chairman and CEO.
Despite the price increases, the number of Monaco Class A motorhomes sold in the first three weeks of April exceeding the number of units the company built during the period, said John Nepute, president.
As of last week, Monaco was building 179 motorhomes and 110 towables per week, said Marty Daley, CFO. The 179 includes diesel- and gas-engine Class A’s and Class C’s.
Monaco operated its motorhome assembly plants at 68% capacity and it was operating its recently expanded travel-trailer and fifth-wheel assembly plant at 85% capacity as of last week, Daley added.
There were 300 more Monaco units on dealers’ lots as of March 31, compared with Dec. 31, but more than half of those units were gas-engine Class A’s. The higher inventory level was an indication that Monaco was successful in gaining dealer “shelf space” to expand its gas Class A and towables businesses, Toolson said.
The value of the units Monaco had completed as of March 31 but had not yet shipped to dealers was $11.7 million, which was well below Monaco’s typical $20 million in finished goods inventory, Daley said.
Sales revenue during the first quarter totaled almost $355 million and that should grow to $360 million to $370 million in the second quarter, Daley said.
Because of the robust wholesale and retail markets, Nepute said, Monaco’s dealer incentive offerings have “returned to normal levels.” He added that Monaco will monitor the market closely as the 2004 model year draws to a close and it will do what is necessary “to help our dealers keep their inventories fresh.”