Marion's Earthbound Recreational Vehicles retools strategy

"We're getting ready to change over into new production," he said. "It has been a massive development effort for the last four months and it's gone longer than expected."

Hoefer said the new 2012 product line is creating an "extraordinary amount of demand" and the first two months of production have already been presold. With an $84,900 starting price, the new "boutique" and customizable 2012 product line is a higher price point than prior offerings.

The retooled line required engineering changes into the product and finalizing distribution networks to sell the trailers in China, Australia and Europe, Hoefer said.

New customizable options and additional "green" features include a special antimicrobial self-cleaning outer coating and a "floppy" solar panel that can completely power the coach. Hoefer said the new line offers at least 70 changes to design and options.

With all the options, a 2012 Earthbound coach can cost as much as $190,000.

Less than 200 RVs are slated for 2012, with around half reserved for North American customers. Hoefer said since each trailer will take more than 500 man-hours to complete, the company is anticipating going back to 50 workers around Christmas and adding the same amount next year.

The company had a three-week layoff in July with temporary hours and small base production focused on finishing out remaining 2011 models and service and warranty.

One Earthbound customer said he was dissatisfied with turnaround times for factory repairs done in Marion. Ohio customer Bob Garlits said his trailer has been in the factory for repairs for more than three months. He recently visited the factory to see the progress of the work.

"It's laying in parts and pieces all over the place there," he said. "Everything was just sitting there. It's pretty depressing."

Garlits said he missed the summer camping season due to the repairs and was giving the company until the end of the month to finish work.

Hoefer acknowledged there were "two instances" of long wait times for repairs, but said the company has had a "very good" service history with customers. He said camping products with custom parts like Earthbound may have longer repair times than regular travel trailers.

City director of development Darren Reese said the company was excited with their new line, which represents a shift in business strategy.

"The product has been spectacular and has created buzz just as expected," he said, though pointing out the company had not been able to make as many units as they expected. "I think they are changing their business model to reflect that."

When the company arrived in Marion, Earthbound had projected around 180 workers producing 400 or more coaches a year. From the start of production in July 2010 until the layoff in July 2011, the company had produced around 150 coaches.

"The reality we discovered working through the process is probably the (maximum) capacity in this facility is 200 to 250," Hoefer said. "It's the nature of the startup phase - you run into things you didn't plan and you work through them."

Reese said the company makes two payments a year on its $2 million loan in February and August. He said the company has made all its payments.

This is good news for the city because if the company is unable to make payments, the city will have to use $2 million in CEDIT money to pay the debt. Reese said this was only in case of a "catastrophic" situation and many things, including personal residences, were put up as collateral.

"If it doesn't work then we get their stuff," he said. "If there is anything left over on balance we'll probably be on the hook and find a way to take care of that."

Production on the 2012 line is not anticipated to start for a month or more.