Elkhart’s EV Dream Dies as RVs Surge Anew

Elkhart, Indiana, is known as the RV capital of the world.

Newmar factory tour, Nappanee, Indiana. © Rex Vogel, all rights reserved

The city suffered badly when the recession hit, and demand for recreational vehicles all but screeched to a halt. That’s when local and state leaders started looking for ways to bolster the area’s manufacturing industry, reports NPR.

The northwestern Indiana County saw electric vehicles (EV) as its salvation after its unemployment rate soared to 20 percent—the highest in the nation at the time.

Electric cars were supposed to be the silver bullet to revive Elkhart’s economy. President Obama visited twice, promising stimulus funds to spark a new economic engine in EVs.

A common criticism of President Obama’s $800 billion stimulus package has been that it failed to produce anything—that while the New Deal built bridges and dams, all the stimulus did was fill some potholes and create temporary jobs.

One success the Obama administration duly claimed is the rebirth of the EV industry in the U. S.

Automakers unveiled a number of mass-market EVs, which saw small but rising sales. Battery and parts manufacturers built 30 factories and created new jobs.

It was all part of an effort to promote “green” manufacturing and put a million electric cars on the road by 2015, reports Pro Publica.

The question was: Would it last?

Elkhart once believed it would.

Eager to seed a new industry, the county witnessed EV ventures sprout out of nowhere as the stimulus took off in 2009.

This is Amish Country. © Rex Vogel, all rights reserved

But by late summer 2011, what had sprouted were mostly weeds. The parking lot of the Think Electric Vehicle factory had an ample supply of them and looked deserted.

There wasn’t a single car in the parking lot. The doors were locked and the windows dark.

At the back of the 200,000-square-foot facility were about 120 road-ready models, called the Think City—a little two-seat fully electric coupe that has a range of about 100 miles before it needs to be recharged.

Hundreds of laid-off factory workers were supposed to have found jobs churning out these Norwegian company’s bug-like, plastic-bodied cars.

Today the Elkhart factory employs two.

That’s right—just two employees are working in this auto plant. At its peak, the plant employed 25 workers. Then two waves of layoffs dropped the payroll down to just two people.

It’s a far cry from the more than 400 that Think Electric Vehicle promised it would hire two years ago.

In June (2011), Think’s parent company filed for bankruptcy.

The decision left the Elkhart plant on the brink of extinction until the American subsidiary was purchased by a Russian entrepreneur who promised to restart production in early 2012.

Then in late January (2012), its largest shareholder and battery maker, Ener1, which received $118 million in stimulus money, also filed for Chapter 11 bankruptcy, reporting that the demand for EVs “did not develop as quickly as anticipated.”

Navistar International had received $39 million in stimulus money to build 400 electric delivery trucks in the first year. But by early 2011, it had hired about 40 employees and assembled only 78 vehicles.

Little remains of Elkhart’s dream of becoming the EV capital?

Elkhart’s economy, however, is on the way back with the RV industry again leading the way.

Welcome to Nappanee, Indiana. © Rex Vogel, all rights reserved

They’re heartened by a rebirth in the industry that some here thought might never bounce back—the RV business.

“Rumors of our demise have been greatly exaggerated,” says Gregg Fore, president of Dicor Corp. Its companies supply components to RV manufacturers.

Fore says the industry’s downturn was brutal, with business falling off close to 60 percent. But demand for RVs has come back strong, he says.

In 2011, the industry produced more than 250,000 RVs. That’s 100,000 more units than the low-water mark in 2009.

Dicor’s factories are once again humming—and hiring, he says. And Fore believes the market for motorhomes, travel trailers, fifth wheels, and campers is here to stay.

But one thing that hasn’t changed, he says, is that the fortunes of Elkhart and its 51,000 still lives or dies with the RV industry.

Nearly half of all the jobs in Elkhart County are in manufacturing. And fully half of Elkhart County’s manufacturing jobs are in making RVs and their parts.

The “free” money has now been spent.

The RV industry has come back—it always comes back and without stimulus money from the White House.

This is why government should get out of the business of telling the people they should drive.

Worth Pondering…

Keep your eyes on the horizon and blaze a trail.

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