Winnebago diversification to embrace bus market
Nov 04, 2012 (Menafn - Waterloo-Cedar Falls Courier - McClatchy-Tribune Information Services via COMTEX) --FOREST CITY, Iowa -- The company known for motor homes now is going into the bus business.
Winnebago Industries Inc. is getting ready to produce Metro Link, a new transit bus that the Forest City-based manufacturer says will utilize some of its motor home technology in a shuttle-type bus.
According to Waterloo native Randy Potts, Winnebago's chairman, CEO and president, it's part of Winnebago's effort to diversify its business in a way to avert a repeat of a downturn in 2008 that caused the company to close one factory and shrink its work force from a peak of 4,220 in August 2004 to 1,694 five years later.
"My challenge is to make Winnebago the leader in the industry in unit volume, in revenues and profits, naturally; beyond that, we do need to look for ways of expanding our business, either parallel to or outside the RV market," Potts said Tuesday.
The first step was forming the Winnebago of Indiana LLC subsidiary, which builds SunnyBrook and Winnebago brand towable products.
Now, Winnebago plans to turn out buses.
Three prototypes of the 25-seat vehicle already have been built and tested, Potts said.
"It's been through the accelerated vehicle-testing program in Altoona, Pa., and it's done very well," he said.
The model also has been shown and demonstrated elsewhere, including recently in Waterloo, Potts said.
"We're trying to see what kind of feedback we can get," he said.
Getting into the transit bus business is not exactly a novel notion at Winnebago, Potts said.
"It's actually a project we've been working on 25 years," he said. "We have a very unique and competitive offering that we're going to be working out."
Space has been set aside at Winnebago's existing manufacturing operation in Forest City to build units, Potts said.
The company is currently finalizing a distribution agreement, which should be done in a matter of weeks, Potts said.
This is a story the company has not trumpeted, Potts said.
"Sometimes it's better to have a soft start," he said.
But the market will hear plenty about Winnebago's transit bus, he said.
"It's different from anybody's transit bus out there," he said.
The vehicle has, among other features, a single-piece fiberglass room that, Potts said, needs less maintenance and eliminates areas for potential water leaks.
"We started working with a consultant company three years ago out of California that's very entrenched in the transportation industry, and what we came out with was a product with a one-piece roof, very unique window configuration that kind of takes your breath away," Potts said.
A seamless roof was a key to the design, Potts said.
"We found out that water leaks were a big sore spot with people that operate these transit buses, so we decided to make a roof with no holes or seams," he said.
The market for the vehicle is "roughly" 20,000 units a year, Potts said.
"That's how many will be produced nationwide by all manufacturers, but it ebbs and flows," he said. "It's another piece of business that's very similar to the motor home business but was designed by a small team."
Production at Winnebago will start slowly, as market needs dictate, Potts said.
"We'll turn out whatever we can sell; we're starting small," he said. "We'll actually be starting up production this winter or early spring, as soon as we take orders to take it beyond small scale."
Additional hiring likely will be required, but Potts did not say how many workers would be needed.
"These things don't require a lot of labor," he said. "We were able to leverage a lot of what we have from our motor homes," he said.
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