TOPICS > Economy

Indiana’s RV Industry Starts a Comeback Amid Uncertain Economy

April 11, 2012 at 12:00 AM EDT
The all-electric Think car was supposed to help save Elkhart, Ind., from a languishing economy, but instead the area's longstanding RV industry is making a comeback and helping turn the economy around. Special correspondent Elizabeth Brackett of WTTW Chicago reports on some economic hope for an area hid hard by unemployment.
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JUDY WOODRUFF: Now: One Midwest U.S. city looks to boost jobs by investing in an industry that was once in decline.

Special correspondent Elizabeth Brackett of WTTW Chicago reports.

ELIZABETH BRACKETT: Elkhart, Ind., has long been known as the R.V. capital of the world. But when the bottom fell out of the R.V. market in 2008, unemployment in Elkhart soared to over 20 percent.

Two years ago, Elkhart jumped on the electric vehicle bandwagon hoping bring, those unemployment numbers down. It lured Norway-based Think Auto to town with federal stimulus money, tax breaks and space in a former R.V. plant.

Elkhart Mayor Dick Moore says in return, Think promised over 400 well-paying jobs. The deal also included two all-electric Think cars for the city.

Mayor Moore says the cars drive well, have good pickup and cost about $3 worth of electricity for every 100 miles.

DICK MOORE, mayor of Elkhart, Ind.: We’re awfully happy that they’ve chosen Elkhart, Ind., to build these cars, and we understand they’re in somewhat of a difficult situation right now, but our hopes are still high, our confidence is still there.

ELIZABETH BRACKETT: The mayor may be the only one holding on to hope. Think autos are still visible through the window of the Elkhart plant, but there is no sign of any activity.

Think filed for bankruptcy protection in Norway last year. A Russian investor just purchased Think at auction, but has not announced any plans for the ailing company.

The president of the county’s Economic Development Commission admits that Think has been a major disappointment.

DORINDA HEIDEN-GUSS, Elkhart County Economic Development Commission: Any time you get your hopes up, you look forward to 415 new jobs, significant multimillion-dollar investment. It’d be a big win for the community, for the county, for the region. And, obviously, it didn’t come to fruition, so that was disappointing.

ELIZABETH BRACKETT: There were problems with the Think car from the start: three recalls for defective equipment. Then the Indiana company producing the batteries for Think went bankrupt. And there was a deeper problem. With a sticker price of $41,000, the Think car found few buyers.

BILL WYLAM, president, International Energy, LLC: If you’ve ever seen the Think car, that would be pretty hard to sell for cars — for people that buy cars in this country,

ELIZABETH BRACKETT: Known as the father of the electric car industry, Bill Wylam, whose nickname is Battery Bill, began working on electric vehicles for General Motors in the 1950s. He doesn’t see the American car buyer warming up to a Think car.

BILL WYLAM: And there are niches where people would want that kind of car, but it probably looks a lot more at home in downtown Brussels or Paris than it does in Indianapolis. And so that type of car, I think, was a problem.

ELIZABETH BRACKETT: But the mayor, who still has hopes for a Think comeback, touts the car’s advantages.

DICK MOORE: It’s not a toy. It’s not a plaything. It is real. And as you can tell, it operates very, very well. The steering is good, the breaking is good, and all of this operates with no gasoline, no bad exhaust emissions. It’s all done on a battery.

ELIZABETH BRACKETT: Indiana has invested millions of state and federal dollars into creating an infrastructure for electric vehicles. Indianapolis has 100 short- and long-term public charging stations.

Paul Mitchell heads a consortium of clean-tech energy companies that have pushed hard for more electric vehicles. But even he admits that developing a brand-new car is tough.

PAUL MITCHELL, president and CEO, Energy Systems Network: It’s going to continue to be an uphill battle for somebody to build a car from the ground up in a global industry where there’s major automakers who have years of experience and deep supply chains to advantage them.

ELIZABETH BRACKETT: Ironically, as the electric car industry struggles, the industry that was largely responsible for the 20 percent unemployment rates in the region began to revive. The R.V. industry picked up in sales and slowly began hiring again.

In Elkhart, Jayco has hired back 600 workers over the last two years. The company cut its work force in half in 2009 as sales plunged 60 percent during the recession. But now Jayco’s largely Amish work force is growing again.

Mark Raber got his job back and says he feels good about the economy.

MARK RABER, Jayco: I think I’m optimistic about it, because looking at the other factories in the R.V. industry, other guys are working six days a week. And, definitely, even a year ago, we were nowhere close. I know that the unemployment has — is higher than it’s been, but I think we’re going to be okay.

ELIZABETH BRACKETT: Jayco now has a new lighter R.V. designed to use less gas, which Jayco president Derald Bontrager thinks will continue to boost sales, even if gas prices remain high.

Jayco is on target to sell 31,000 R.V.s this year, only 4,000 less than its peak sales before the recession hit. Bontrager understands how important Jayco’s recovery is to the surrounding economy.

DERALD BONTRAGER, president, Jayco: We have a huge impact on this economy. And I hear it all the time walking the streets and in the stores. They ask, how you doing, because they always say, how you’re doing has a big bearing on how all the other retail establishments in the area are doing.

ELIZABETH BRACKETT: Mayor Moore still looks to electric vehicles and other clean-energy technologies to boost job creation in the future.

But for now.

DICK MOORE:  I need immediate, quick recovery, and it’s right here. Don’t turn your back on the R.V. industry. They know what they are doing. They have been through this cycle many, many times. Watch and see what happens.

ELIZABETH BRACKETT: So, for now, the hottest vehicle in Indiana is not from the future. It’s from the past.