National RV Holdings Inc.’s stock dropped more than 10% Tuesday (Nov. 8) after the manufacturer announced a greater-than-expected third-quarter loss of $5.9 million, according to a report in the Press-Enterprise, Riverside, Calif.
To cut overhead costs and help it return to profitability, the manufacturer laid off 50 employees at its operations in Perris, Calif., last week, president and CEO Brad Albrechtsen said Tuesday after a conference call with analysts and investors. More cuts could follow.
While auditors for the company did complete a positive review during the third quarter, and National RV Holdings was able to report overdue financial numbers for 2004, it faced a soft motorhome market, especially in September.
National RV Holdings is parent to motorhome builders National RV Inc., Perris, and Junction City, Ore.-based Country Coach Inc. The company said sales of lower-priced gas and diesel coaches built in Perris had declined while demand remained strong for higher-end Country Coach models.
As a result, National RV reduced production to 35 motorhomes a week in Perris, where the plant is running at 40% of its capacity, Albrechtsen said. The Oregon plant produces 16 units a week and operates at closer to 90% capacity.
Albrechtsen said for the company to make a profit, it needs to make and sell about 10 more motorhomes each week, primarily from its 49-acre, 600,000-square-foot Perris facility.
Also, the company said it has changed its product mix, adding new floor plans to some models, and introducing new coaches at different price points. And it plans to replace some dealers and add 10 to 15 new dealers nationwide by January.
“That way, we can gain incremental market share, even if the market stays flat,” Albrechtsen said, adding that he believes demand will improve soon.