Winnebago Suspends RV Production Due to Coronavirus

Winnebago, citing health concerns and slumping demand, suspended most recreational-vehicle production.
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Shares of Winnebago Industries  (WGO) - Get Report fell after the recreation vehicle titan said it was suspending most production activity at its plants in response to the coronavirus.

“This action is in response to the national spread of the coronavirus, the national emergency associated with the virus, and unforeseeable change in business circumstances that have accompanied it,” the Forest City, Iowa, company said in a statement.

The company's brands include Winnebago, Grand Design, Chris-Craft and Newmar.

“These steps are designed to lower the probability of coronavirus exposure to employees and adjust future production output relative to a fast-changing demand landscape for the company’s products,” Winnebago said.

The company will continue to “perform essential activities for its dealers and end customers, including remote retail support for dealers, along with technical care, warranty administration, and parts fulfillment,” the statement said.

“Our top priority is the health and well-being of our employees, business partners, customers and communities,” Chief Executive Michael Happe said in the statement.

“We are also seeing demand for our products shift dramatically as the nation takes appropriate action to curb the spread of the coronavirus.”

The company said it was providing base pay and benefits to its workers for the first two weeks of the shutdown.

“We remain confident in the strength of our balance sheet and in our cash position to allow us to provide the appropriate pay and benefits to our employees and weather a period of business interruption from this health crisis,” Happe said.

The Big Three U.S. automakers last week decided to shut down all their North American manufacturing plants.

At last check, Winnebago shares traded at $21.85, down 4.1%.