Lets discuss Rapido's acquisition of Roadtrek

[thawk]

so, before the purchase, Rapido claimed that they would honor warranties for purchases made prior to the bankruptcy . Now that they are up and running, they are only offering a $1500 max warranty covering up to 2 years from original purchase.

They are also not honoring warranties for models that have a second row seat. The staff seems to have an offensive tone when calling them. During my conversation with them, they told me that they bought a brand and that we should be happy that we are getting anything at all.

To me, it seems like they are buying more than a brand. Aren't they buying the distribution network and any licensing to sell in the U.S.

I'm just trying to open discussion to see what others thoughts are.

[RossWilliams]

Rapido did buy more than the brand. They also bought Roadtrek's designs and other intellectual property, unfinished units and manufacturing equipement. They also seem to have acquired their lists of customers, suppliers and dealers. What Rapido did not acquire is any of Hymer NA's liabilities, including any legal obligation to Hymer's employees, creditors, customers or suppliers. So Rapido's offer to warranty problems found in Hymer manufactured units sold in the last two years is purely a question of goodwill.

Perhaps Rapido could do more. But compare Rapido to Thor's treatment of Hymer brands customers. Thor and Erwin Hymer Group arranged the sale and Hymer NA's receivership so Thor would have no legal obligation to Hymer NA's customers, employees or suppliers. There has been zero support for those customers, despite Thor now owning all the Hymer brands and having almost all the Erwin Hymer Group's top management as part of their organization. The same people who oversaw the formation and demise of Hymer NA. Moreover, it appears from the list of creditors in the receivership that Thor, as the owner of Erwin Hymer Group, will get a very large check out of the bankruptcy proceeds as Hymer NA's largest creditor.

The question people should ask is why isn't Thor doing more for Hymer customers.

[thawk]

I understand, but doesn't it seem like a gray area. I mean, a company can declare bankruptcy and start new and wipe all liabilities away whatever they may be.

[RossWilliams]

But that isn't what happened here. Hymer NA went bankrupt and the receiver sold off its assets. Rapido bought some, but not all, of those assets and used them to create a brand new company. They didn't wreck the company, they just bought the wreckage.

The owner of Hymer NA that created the wreckage was Erwin Hymer Group, now part of Thor.

[Davydd]

I doubt any management that made up EHGNA is part of Thor.

[RossWilliams]

"I doubt any management that made up EHGNA is part of Thor. "

Probably not. But EHGNA was a wholly owned subsidiary of Erwin Hymer Group. Someone at EHG was supervising it. EHG's management became part of Thor. EHG shareholder/owners largely just replaced their EHG stock with Thor stock in the purchase. We will never know to what extent any of those folks were directly responsible for the debacle, but they certainly had the ultimate authority and responsibility.

[mumkin]

Originally Posted by thawk

so, before the purchase, Rapido claimed that they would honor warranties for purchases made prior to the bankruptcy . Now that they are up and running, they are only offering a $1500 max warranty covering up to 2 years from original purchase.

They are also not honoring warranties for models that have a second row seat. The staff seems to have an offensive tone when calling them. During my conversation with them, they told me that they bought a brand and that we should be happy that we are getting anything at all.

As someone who purchased a new Roadtrek just 7 or so months before the company was dumped by the Hymer family to maximize their profit from the selling of EHG in Europe, it was clear from the beginning that Rapido was not foolish enough to take on the financial disaster of the 6 year warranty. They were clear that they would only offer a limited warranty, and even that was more than they were required to do by law. I have put in my one warranty claim, and it has been approved, and eventually a check will show up. (some have received their checks) Since I purchased a Simplicity... with the good old dependable systems, I haven't had any issues except the one that it arrived with... a dead underhood generator. It was replaced by Nation's Starter.

As to the debacle of the 2nd row seats in the Sprinters, again... Rapido was smart. The fact that these seats have been illegal for years was a no-brainer for them. There may be law suits involved and they were smart to exclude these vehicles. I want this company to succeed, and thus far, they have shown that they know what they are doing.

My contacts with current employees have all been positive.

[Davydd]

Originally Posted by RossWilliams

"I doubt any management that made up EHGNA is part of Thor. "

Probably not. But EHGNA was a wholly owned subsidiary of Erwin Hymer Group. Someone at EHG was supervising it. EHG's management became part of Thor. EHG shareholder/owners largely just replaced their EHG stock with Thor stock in the purchase. We will never know to what extent any of those folks were directly responsible for the debacle, but they certainly had the ultimate authority and responsibility.

Thor simply did due diligence on Hymer and wanted nothing to do with a rogue subsidiary in its own backyard but took Europe. That says a lot. Hymer got taken originally and Thor would not take the bait. You can't shove the blame on Thor on any of this.

[booster]

What is really odd to me is that not only Hymer got taken in and didn't catch the issues going on, as the interim investment company that owned Roadtrek before Hymer also got taken in before that.


Even though we didn't know anything was coming at the time, we got some information during our plant tour in fall 2009 that now kind of was the start of a pattern, it now appears. The dates listed are purely guesses, but I think they are close.


Roadtrek family owned and run until group of managers from Bud Wheel were hired in about 2006.


Under the new managers very rapidly expanded capacity of Roadtrek, including things like moving the entire paint shop to a remote facility, and probably other ill advised and very inefficient things. Logistic nightmares like part shortages on the assembly lines, bad quality requiring line stoppages, bad training on a big increase in production staff had the assembly line held up and waiting for large periods of time we were told.


By 2008 the wheels were coming off the economy and Roadtrek, as they had severely overbuilt with the increased capacity and were sitting on huge inventories.


In fall 2009 when we toured, they were bringing the painting back in house, laying off like crazy, and because of all the assembly line stoppages had given up on using a line style process and went to "workcells" for basically each of the line style steps. They physically had to move each van to the next cell by driving them out and back into the open area. When we were there the manufacturing floor would be described as chaos at best.



At that time, they were also getting into the "throw new models at the wall and see what sticks mode" and were told the proto for SSIdeal was nearly done.


By then they had the huge rebates and discounts to get rid of all the built up stock and cut production down to bare minimum. It also appears now that at that time they were highly leveraged with debt taken to finance the original expansion and right down the losses for carrying and discounting the huge stock from overbuilding.

Investment company with good reputation for cleaning up messes came in and many of us thought they would put some money in, find out and eliminate the management that made the bad decisions, and ride out economy as well as possible with reduced staff and output plus eliminating efficiencies.


Nothing really changed at Roadtrek, however, and they continued as they were, with lots of new models, deteriorating quality and ill advised decisions, with the same management team. Prices went way up, probably because of the cost of production inefficiencies and debt load required it.


A huge social media campaign probably did more for Roadtrek's survival than anything else, with lots of "ambassadors" and very tightly controlled sites producing lots of attention and severely limiting and attacking anyone, anywhere who criticized a Roadtrek product. During this period there also a lot of deceptive manipulation of specs, units of measurement, and such to make the products look better and more capable than the were, IMO.


When the investment company thought the company and looked good enough to sell, Hymer came along. It is debatable how they got so fooled as to the accuracy of the healthiness of Roadtrek, but that is not for here.


Hymer made the same mistake, IMO, as the investment company in leaving the Roadtrek management mostly intact and in charge of the entire NA business.


The past decisions of over expanding too quickly, poor quality, too much debt, bad training, too many new models, etc were all repeated very similarly to the way they happened in the late 2000s, but on a much larger scale. The results also followed the earlier problems and were disastrous.



I don't think we know for sure why Hymer decided to sell for sure, but it is likely the Hymer kids just wanted a payout without running a big company, and I also think they didn't know what to do a about the North America division that was heading for a dramatic crisis problem.


Selling all of Hymer looked good to them, and Thor was willing.



Thor, however, appears to have done their due diligence well and saw that the NA division was not a good investment, even if just to kill off competition. They also appear to have found lots of stuff that Hymer and investment company missed so they had plenty of excuses to cut out NA division from the deal.


Hymer played all the legal tricks to dump all the losses on NA to be able to get out with most cash, so NA had no chance of survival or sale as a fully operational business.



The rest is history, receivership and liquidation with Rapido stepping up and buying the brand name and some of the leftover stock with intentions of starting a NEW Roadtrek brand, not a continuation of the old one. They had essentially no legal responsibility to the existing customers or vendors at that point, so anything they do for either group is a good faith freebie, IMO.



Bottom line, to me, is that Rapido is in no way the bad guy here, and was willing to try bring the Roadtrek name back, and give jobs to some of the old employees when nobody else really wanted to do that except pick some odds and ends at auction.


The "bad guys" if you want that for a term, would go all the way back to when the family gave control of Roadtrek up to the group of new managers that came from Bud Wheel CA the mid 2000s, and all the others that owned Roadtrek but didn't do anything to prevent the recurring bad decisions. This would include the original Roadtrek family owners, the investment company, and Hymer.


Please remember that these are strictly my OBSERVATIONS AND OPINIONS, and yours may well be different, which is just fine with me.

[RossWilliams]

"You can't shove the blame on Thor on any of this."

You can't make a distinction between Thor and Erwin Hymer, they are now the same company. And there is no real evidence Erwin Hymer "got taken". They had been operating Roadtrek for several years before it went bankrupt. The management of Hymer NA worked for them. They were the ones that ran it into the ground with a massive expansion that turned out to be unprofitable. Whether those bad decisions were made by their local management in North America or their top management in Europe is irrelevant. And there is no evidence the Erwin Hymer Group was unaware that their North American operations weren't profitable.

What Thor "discovered" was that the Hymer NA expansion hadn't worked and it was losing money. So they figured out how to shift the cost of those bad decision on to EHGNA's employees, customers and suppliers. Erwin Hymer, now Thor, had financed that expansion with "loans". They could bankrupt EHGNA and claim the proceeds of the bankruptcy sale as a creditor, leaving behind the unpaid bills, empty factories and promised warranties.

I can't imagine Thor not being involved in those decisions about the future of EHGNA while they were in the process of buying Erwin Hymer Group, EHGNA's largest creditor and owner. If EHG had forgiven EHGNA's debt, EHGNA would have been solvent. But Thor would have been out a large chunk of equity those loans represented in their purchase. Far from wanting to have "nothing to do" with EHGNA, Thor became its largest creditor after the sale.

[rowiebowie]

Originally Posted by booster

What is really odd to me is that not only Hymer got taken in and didn't catch the issues going on, as the interim investment company that owned Roadtrek before Hymer also got taken in before that.


Even though we didn't know anything was coming at the time, we got some information during our plant tour in fall 2009 that now kind of was the start of a pattern, it now appears. The dates listed are purely guesses, but I think they are close.


Roadtrek family owned and run until group of managers from Bud Wheel were hired in about 2006.


Under the new managers very rapidly expanded capacity of Roadtrek, including things like moving the entire paint shop to a remote facility, and probably other ill advised and very inefficient things. Logistic nightmares like part shortages on the assembly lines, bad quality requiring line stoppages, bad training on a big increase in production staff had the assembly line held up and waiting for large periods of time we were told.


By 2008 the wheels were coming off the economy and Roadtrek, as they had severely overbuilt with the increased capacity and were sitting on huge inventories.


In fall 2009 when we toured, they were bringing the painting back in house, laying off like crazy, and because of all the assembly line stoppages had given up on using a line style process and went to "workcells" for basically each of the line style steps. They physically had to move each van to the next cell by driving them out and back into the open area. When we were there the manufacturing floor would be described as chaos at best.



At that time, they were also getting into the "throw new models at the wall and see what sticks mode" and were told the proto for SSIdeal was nearly done.


By then they had the huge rebates and discounts to get rid of all the built up stock and cut production down to bare minimum. It also appears now that at that time they were highly leveraged with debt taken to finance the original expansion and right down the losses for carrying and discounting the huge stock from overbuilding.

Investment company with good reputation for cleaning up messes came in and many of us thought they would put some money in, find out and eliminate the management that made the bad decisions, and ride out economy as well as possible with reduced staff and output plus eliminating efficiencies.


Nothing really changed at Roadtrek, however, and they continued as they were, with lots of new models, deteriorating quality and ill advised decisions, with the same management team. Prices went way up, probably because of the cost of production inefficiencies and debt load required it.


A huge social media campaign probably did more for Roadtrek's survival than anything else, with lots of "ambassadors" and very tightly controlled sites producing lots of attention and severely limiting and attacking anyone, anywhere who criticized a Roadtrek product. During this period there also a lot of deceptive manipulation of specs, units of measurement, and such to make the products look better and more capable than the were, IMO.


When the investment company thought the company and looked good enough to sell, Hymer came along. It is debatable how they got so fooled as to the accuracy of the healthiness of Roadtrek, but that is not for here.


Hymer made the same mistake, IMO, as the investment company in leaving the Roadtrek management mostly intact and in charge of the entire NA business.


The past decisions of over expanding too quickly, poor quality, too much debt, bad training, too many new models, etc were all repeated very similarly to the way they happened in the late 2000s, but on a much larger scale. The results also followed the earlier problems and were disastrous.



I don't think we know for sure why Hymer decided to sell for sure, but it is likely the Hymer kids just wanted a payout without running a big company, and I also think they didn't know what to do a about the North America division that was heading for a dramatic crisis problem.


Selling all of Hymer looked good to them, and Thor was willing.



Thor, however, appears to have done their due diligence well and saw that the NA division was not a good investment, even if just to kill off competition. They also appear to have found lots of stuff that Hymer and investment company missed so they had plenty of excuses to cut out NA division from the deal.


Hymer played all the legal tricks to dump all the losses on NA to be able to get out with most cash, so NA had no chance of survival or sale as a fully operational business.



The rest is history, receivership and liquidation with Rapido stepping up and buying the brand name and some of the leftover stock with intentions of starting a NEW Roadtrek brand, not a continuation of the old one. They had essentially no legal responsibility to the existing customers or vendors at that point, so anything they do for either group is a good faith freebie, IMO.



Bottom line, to me, is that Rapido is in no way the bad guy here, and was willing to try bring the Roadtrek name back, and give jobs to some of the old employees when nobody else really wanted to do that except pick some odds and ends at auction.


The "bad guys" if you want that for a term, would go all the way back to when the family gave control of Roadtrek up to the group of new managers that came from Bud Wheel CA the mid 2000s, and all the others that owned Roadtrek but didn't do anything to prevent the recurring bad decisions. This would include the original Roadtrek family owners, the investment company, and Hymer.


Please remember that these are strictly my OBSERVATIONS AND OPINIONS, and yours may well be different, which is just fine with me.

Thanks, booster. That is probably as succinct and logical explanation of the way things played out. It didn't happen over night.

Good for Rapido if they can make a go of the new Roadtrek, as nobody else stepped up.

[mumkin]

I would agree with most of that summary though my opinions on details may vary here and there. More emphasis probably needs to be put on the the two recessions that occurred in the very early and mid-2000s. Especially the second one that tanked so many well-known RV brands that had over-extended themselves.

At the same time, you had the next generation in the family who perhaps never really wanted to stay in the RV business. (that is what killed Great West when Marty's health started to decline and none of his kids wanted it... and the buyer quickly drove it to Alabama and into the toilet) So bring in new management with big ideas that ended up being not the best. While covering their mistakes apparently lead to some creative accounting methods...

IMHO The arrival of a big investment company was the death of quality control which had already been slipping slowly. They only care about one thing... bottom line... and thus quantity over quality... head em up, move em out. Let the dealers deal with fixing everything we screw up and then underpay them for the work. Time to perfect those accounting finagles.

And then came the Hymer family with their stellar reputation in Germany. But again... a new generation... who apparently just let the local management run wild. We'll never know how much they knew and allowed.

My opinion is that Thor and Hymer planned to tank EHGNA from their first negotiating meeting. Way back at that point Hymer created the US LLC, Corner Flag, who bought EHGNA and drove it directly to the bankruptcy court. I'm sure that expensive extensive audit was part of the money negotiations - it was a Hymer audit - not really Thor - so that all would be ready for the Receivers to sell it. (what Hymer SHOULD have done before their purchase) It wasn't Thor that wanted to know every single part in the inventory... it was Hymer for the Receiver.

I think Netflix or Amazon should consider making a soap opera serial... This is, of course, just my speculations based on following lots of discussions online, the legal docs, and The Google... added to my first career in accounting where I watched companies and law firms create finagles like this. All nice and legal... but so unethical.

[GeorgeRa]

Originally Posted by booster

What is really odd to me is that not only Hymer got taken in and didn't catch the issues going on, as the interim investment company that owned Roadtrek before Hymer also got taken in before that.


Even though we didn't know anything was coming at the time, we got some information during our plant tour in fall 2009 that now kind of was the start of a pattern, it now appears. The dates listed are purely guesses, but I think they are close.


Roadtrek family owned and run until group of managers from Bud Wheel were hired in about 2006.


Under the new managers very rapidly expanded capacity of Roadtrek, including things like moving the entire paint shop to a remote facility, and probably other ill advised and very inefficient things. Logistic nightmares like part shortages on the assembly lines, bad quality requiring line stoppages, bad training on a big increase in production staff had the assembly line held up and waiting for large periods of time we were told.


By 2008 the wheels were coming off the economy and Roadtrek, as they had severely overbuilt with the increased capacity and were sitting on huge inventories.


In fall 2009 when we toured, they were bringing the painting back in house, laying off like crazy, and because of all the assembly line stoppages had given up on using a line style process and went to "workcells" for basically each of the line style steps. They physically had to move each van to the next cell by driving them out and back into the open area. When we were there the manufacturing floor would be described as chaos at best.



At that time, they were also getting into the "throw new models at the wall and see what sticks mode" and were told the proto for SSIdeal was nearly done.


By then they had the huge rebates and discounts to get rid of all the built up stock and cut production down to bare minimum. It also appears now that at that time they were highly leveraged with debt taken to finance the original expansion and right down the losses for carrying and discounting the huge stock from overbuilding.

Investment company with good reputation for cleaning up messes came in and many of us thought they would put some money in, find out and eliminate the management that made the bad decisions, and ride out economy as well as possible with reduced staff and output plus eliminating efficiencies.


Nothing really changed at Roadtrek, however, and they continued as they were, with lots of new models, deteriorating quality and ill advised decisions, with the same management team. Prices went way up, probably because of the cost of production inefficiencies and debt load required it.


A huge social media campaign probably did more for Roadtrek's survival than anything else, with lots of "ambassadors" and very tightly controlled sites producing lots of attention and severely limiting and attacking anyone, anywhere who criticized a Roadtrek product. During this period there also a lot of deceptive manipulation of specs, units of measurement, and such to make the products look better and more capable than the were, IMO.


When the investment company thought the company and looked good enough to sell, Hymer came along. It is debatable how they got so fooled as to the accuracy of the healthiness of Roadtrek, but that is not for here.


Hymer made the same mistake, IMO, as the investment company in leaving the Roadtrek management mostly intact and in charge of the entire NA business.


The past decisions of over expanding too quickly, poor quality, too much debt, bad training, too many new models, etc were all repeated very similarly to the way they happened in the late 2000s, but on a much larger scale. The results also followed the earlier problems and were disastrous.



I don't think we know for sure why Hymer decided to sell for sure, but it is likely the Hymer kids just wanted a payout without running a big company, and I also think they didn't know what to do a about the North America division that was heading for a dramatic crisis problem.


Selling all of Hymer looked good to them, and Thor was willing.



Thor, however, appears to have done their due diligence well and saw that the NA division was not a good investment, even if just to kill off competition. They also appear to have found lots of stuff that Hymer and investment company missed so they had plenty of excuses to cut out NA division from the deal.


Hymer played all the legal tricks to dump all the losses on NA to be able to get out with most cash, so NA had no chance of survival or sale as a fully operational business.



The rest is history, receivership and liquidation with Rapido stepping up and buying the brand name and some of the leftover stock with intentions of starting a NEW Roadtrek brand, not a continuation of the old one. They had essentially no legal responsibility to the existing customers or vendors at that point, so anything they do for either group is a good faith freebie, IMO.



Bottom line, to me, is that Rapido is in no way the bad guy here, and was willing to try bring the Roadtrek name back, and give jobs to some of the old employees when nobody else really wanted to do that except pick some odds and ends at auction.


The "bad guys" if you want that for a term, would go all the way back to when the family gave control of Roadtrek up to the group of new managers that came from Bud Wheel CA the mid 2000s, and all the others that owned Roadtrek but didn't do anything to prevent the recurring bad decisions. This would include the original Roadtrek family owners, the investment company, and Hymer.


Please remember that these are strictly my OBSERVATIONS AND OPINIONS, and yours may well be different, which is just fine with me.

Thank you, it is great to see real history of Roadtrek, I hope that with Westfalia reviving experience Roadtrek/Rapido will be successful.

[thawk]

Originally Posted by mumkin

As someone who purchased a new Roadtrek just 7 or so months before the company was dumped by the Hymer family to maximize their profit from the selling of EHG in Europe, it was clear from the beginning that Rapido was not foolish enough to take on the financial disaster of the 6 year warranty. They were clear that they would only offer a limited warranty, and even that was more than they were required to do by law. I have put in my one warranty claim, and it has been approved, and eventually a check will show up. (some have received their checks) Since I purchased a Simplicity... with the good old dependable systems, I haven't had any issues except the one that it arrived with... a dead underhood generator. It was replaced by Nation's Starter.

As to the debacle of the 2nd row seats in the Sprinters, again... Rapido was smart. The fact that these seats have been illegal for years was a no-brainer for them. There may be law suits involved and they were smart to exclude these vehicles. I want this company to succeed, and thus far, they have shown that they know what they are doing.

My contacts with current employees have all been positive.

I'm confused. You mention that you haven't had any issues except the UHG which nations took care of. What claim did you put in with Rapido?

[RossWilliams]

One other thing, this is a discussion of Roadtrek. I made the mistake of suggesting it was Roadtrek that went bankrupt. But it was Hymer NA that went into bankruptcy. We have no way of knowing whether the Roadtrek part of the operation contributed anything to Hymer NA's problems. Its quick revival would suggest the Roadtrek operation wasn't the core of the problem.

[Davydd]

Ross, Are you defending Jim Hammil and his management team?

[rowiebowie]

Originally Posted by RossWilliams

One other thing, this is a discussion of Roadtrek. I made the mistake of suggesting it was Roadtrek that went bankrupt. But it was Hymer NA that went into bankruptcy. We have no way of knowing whether the Roadtrek part of the operation contributed anything to Hymer NA's problems. Its quick revival would suggest the Roadtrek operation wasn't the core of the problem.

Really? Your assertion is that Roadtrek played no core role in it's demise?

[booster]

Originally Posted by rowiebowie

Really? Your assertion is that Roadtrek played no core role in it's demise?

No surprise there, I think. Ross has always come to Hammil's and the old Roadtrek business defense, including accusing others of personal bias. IMO, the events happened as I stated, if Ross chooses to think the Roadtrek management had nothing to do with it, we can't change that.

[RossWilliams]

" Your assertion is that Roadtrek played no core role in it's demise? "

No, my assertion is you have no way to know whether it did or not. Its perfectly plausible that they were making lots of money producing Roadtreks and losing even more producing the Erwin Hymer brands. Its possible Rapido thinks it can avoid Hymer's mistakes. But its also possible that they looked at the numbers and decided producing Roadtreks was already a successful business. All they needed to do was get it back into the market.

"Are you defending Jim Hammil and his management team? "

No. I don't understand why you are defending Erwin Hymer Group's management and owners. They were the people with ultimate authority and responsibility, Jim Hammil and his management team worked for them. When it was clear EHGNA was failing it was EHG and Thor's management that figured out how to pass the bill for that failure to their employees, suppliers and customers. What I am objecting to is the idea that the people really in charge, EHG and Thor, were victims or innocent bystanders.

[Stevemo]

2008/2009 was very hard on Roadtrek. They had so much 2008 inventory that they did not even release an owners manual for "2009". I believe it was about that time that they went from building RVs in anticipation to only building to order.
This summer I saw the evidence that their factories spare parts and tooling had been auctioned off. Plastic tanks were turning up everywhere and "Hymer" labelled tools were available 5 hours north of the factory.
I always regret not buying their full size Sprinter model back in 2009. We were travelling in our 1991 Roadtrek with the Canadian dollar higher than the US dollar and the sticker price on them was really discounted. They were moving them from state to state trying to find anybody who could afford one. Now the dollar sucks and the prices have gone up a lot. Roadtrek did a great job determining what the maximum pain threshold for the Class B RV is.

As for warranty, Roadtrek's ownership has indicated that the OEMs warranties are good for all of the major sub-components. How much risk could there really be in the overall assembled package? Some annoying little leak or a hing falls apart? Ownership should be manageable without the warranty. We have a 2004 Popular 190 now and it is mostly original.