Thor president touts RV maker’s track record

Bob Martin detailed the history, present and future of Thor Industries Wednesday, May 8, at the 2013 Baird Growth Stock Conference.

Posted on May 8, 2013 at 1:00 a.m. | Updated on May 8, 2013 at 5:15 p.m.

ELKHART — Bob Martin, president of Elkhart-based Thor Industries, addressed the 2013 Baird Growth Stock Conference in Chicago Wednesday, May 8, and his talk covered Thor’s past, present and future, as well as some of the bigger trends in the RV industry in general.

He talked in some detail about recreational vehicles and the growth in the motorized RV market, as well as why Thor is in the bus market and why the company just sold its ambulance business.


In his prepared remarks and in answer to audience questions, Martin laid out a look at Thor:

Ÿ 96 brands in its subsidiaries (Keystone alone has more than 20 brands)

Ÿ Largest RV manufacturer in the industry.

Ÿ 36.3 percent of the RV market.

Ÿ 33 percent of the travel-trailer market.

Ÿ No. 1 in the fifth-wheel market, with market share greater than 50 percent.

Ÿ No. 2 in motorhomes, but growing this year.

Ÿ 8,800 employees overall.

Ÿ 96 production facilities across seven states.

Ÿ More than 6 million square feet of combined indoor production.

Martin said the company recently developed a bottom-up plan for the next three years, “looking at how we can increase operational efficiencies from the ground up.” They want to spread some of Airstream and Keystone’s successful formulas to other subsidiaries, while maintaining autonomy in the subsidiary companies. “We don’t have a top-down approach for what we do,” he said. All divisions will work on improving quality, adding features and managing parts costs.

The competition for towable RV space on dealer lots is fierce, so Thor divisions are communicating more in an attempt to keep from cannibalizing each other, he said. “We have to protect our shelf space.”

Don Romeo, the new senior vice president and chief financial officer of Thor, said, “I think right now we’re in a good cycle. We’ll see how the next couple of years play out.”


Martin and Romeo both pointed to growth potential as the motorized market rebounds, at least somewhat. Martin said, “ongoing strength in motorized definitely suggests that consumer demand and financing is loosening up a little bit. That’s something we’re seeing on the wholesale and the retail level.

“RV dealers are seasonal, but as we talk to dealers … they’ve all been very positive. Traffic has been very good and the optimism as the dealers go into spring has been very strong for all of our dealers,” Martin said.

Still, the industry is vastly smaller than it once was. Martin said the segment is down to 25,000 units, compared to 70,000 units five years ago. “The motorized industry even 20 years ago was over 150,000,” he said.

“There are a lot of people who enjoy their motorhomes. I think a lot of people in the recession maybe traded out of their motorhomes, went down to a towable just for financial reasons. There was a credit limit on the retail end that people couldn’t finance much over $100,000 for a period of time. Then it went to 125, then 150. It has loosened,” Martin said.

“I don’t know that it’ll grow 10,000 units in a year, but there’s definitely upside there,” he said.


Thor and its biggest competitor, Forest River, managed to pick up other manufacturers as they folded during the recession. It’s at the point now, Martin said, that “there aren’t too many more opportunities for consolidation in the industry.”

Still, Thor is keeping an eye on the competition. As one questioner pointed out, Keystone and Forest River “came out of nowhere” and now lead the industry.

Martin said it’s not as easy now for competition to come in. “Timing is everything. I lived that. I worked at Coachmen 20 years ago. I watched Coachmen have a rise and fall. I left Coachmen and went to this little company called Keystone. Timing was perfect,” he said.

Coachmen is now owned by Forest River, Martin said. The other big industry name at that time saw a demise that benefitted Keystone due to the timing, he said.

“Fleetwood, when I started in the industry, Fleetwood was the No. 1 brand with 30 percent market share. They’re no longer producing towables. Our Heartland division has bought the Fleetwood names, so we are producing some of those brands,” he said.

Chassis costs are a huge barrier to new companies in the motorized market, he said.

“Towables, yes, there are a couple new startups, but it’s new. Time will tell how they do. For us it’s actually energized most of our divisions to be more competitive and create new innovations in their products,” Martin said.

When one audience member asked about new products and features on the horizon, Martin said, “We always have things that we’re working on, but we typically hold them close to our vest.

“The fall open house, right now all of our divisions are focusing on what is the next big thing,” he said.

“We truly have the strongest product-development teams in the industry, and we’re pushing them.”


While 80 percent of Thor’s business is building RVs, the other 20 percent is in bus manufacturing. “We also own the largest size bus manufacturing facilities in the nation, spread out across three states,” Martin said. They make transit and shuttle buses.

“It is still a relatively small piece of what we do,” Martin said. Still, buses and RVs operate on different economic cycles, so “it helps diversify, level out the business a little bit.”


SJC “was one of our non-core business groups,” Martin said. “We are 80 percent RV and 20 percent bus. Ambulance is something we’ve had for just a few years, and we are increasing our bus capacity. It is in our Goshen Coach complex, so as we sell that we will simply increase our bus capacity in that complex.”

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