By Ron Burdge
RV LEMON LAW ATTORNEY
When an RV manufacturer goes out of business, everyone loses. Hymer North America just shut everything down. They aren’t the first RV company to go out of business and won’t be the last.
What does it mean to owners? Plenty. Here are my thoughts as an RV lawyer: It may be upper management’s fault but practically speaking that doesn’t matter. But let’s not start at the top. The lives most likely disrupted are owners whose new RV warranties are now worthless, and their lives and plans go up in smoke overnight. Now any service or repair is most likely at their own expense and that could be thousands of dollars on top of the thousands they paid to buy the RV in the first place.
So what to do?
Owners should start planning their maintenance better, get it done regularly and save up for the certainty of future repairs. It sucks, but it’s reality. In most situations owners won’t have any legal rights against the selling dealer (they should read their sales paperwork carefully and talk to a local contract law lawyer in the state where they bought the RV).
And the hundreds of company employees? Bad news. In most cases they won’t be able to do anything but look for unemployment while draining their savings looking for another job. Even if the company owes them wages or money under an employment contract (which most people don’t have anyway), that’s just a claim that will likely end up in a bankruptcy or similar liquidation proceeding.
Some companies go out of business without even doing that; they just lock the doors and write out checks to whoever they want until the assets are gone. It could be a mentality of “Let’s pay this supplier so we have a chance of getting new jobs for ourselves, but not pay the last payroll,” etc. Filing a lawsuit to stop it probably won’t work because the money and people will be gone before their case even gets to court.
What about the RV dealers?
Now let’s look at the retail dealers. They are owed for pending warranty claims; good luck. They have expensive new “orphaned” RVs sitting on their lots with disappearing warranties that have ripped the hearts from the RV’s price and, hence, their retail value. Get ready for a “fire sale,” folks.
If a buyer is really good with mechanical things, it will be a good time to buy. If not, steer clear of the orphan lot. Either way, dealers might as well get out a towel because they’re going to take a bath, a deep one. Nobody wins when an RV company goes out of business, except maybe the ones at the top of the corporate ladder who can grab the money and run.
Next week: Thinking of buying a new RV without a warranty? Be careful!
Ron Burdge is one of America’s most highly respected RV lemon lawyers. He has gained justice for countless RVers across the United States during his more than 30 years of practice. He is a frequent speaker at national seminars and conferences on Lemon Laws and Consumer Protection Laws. For more information or to contact him visit his website or call his office in Dayton, Ohio, at 937-432-9500.
I did buy an orphan. Luckily, the only issue was a small leak that I fixed and then I applied a rubber roof. The travel trailer is 9 years old so I consider myself lucky with no other issues .
These poor people who got real lemons with separating sides, misaligned this and that, and other awful items is a terrible violation of trust and compliance no matter if it is an orphan or not. This should be punishable with severe jail sentences.
And wow I just went to the Tampa Supershow last month and saw all those Hymers. Yikes I am so sorry.
As an owner of an Alfa motor home that was in the factory for warranty work when the factory doors were closed, we certainly can feel for others in the same situation. As we live in Virginia and the factory is in California, it cost us thousands to just get it back. No notice. No offer to help. The rig was to be resided under warranty. We lost our shirt when we sold it last year.
A thought or two I’ve seen this week. For customers, it may be a good idea to wait until a buyer for Roadtrek appears- who will make good on the famous 6 year warrantee. In my mind this would make sense before buying an aftermarket service contract. For dealers- they might choose to title all the new units sitting on their lots and then sell them “as is”. There are other ideas floating around out there. There was a curious post on one of the forums: “Better check your VIN, it may belong to someone else.” Those Hymer dirty rats- I’m waiting to see how the system ultimately deals with these people but I’m not holding my breath.
As a loyal Roadtrek fan, I am saddened and disturbed that the company has folded. I have an older model (2010) so that the warranty situation doesn’t apply to me. I am somewhat concerned about parts, but most of the parts that tend to break down are third-party ones, so that may not be a big problem. I have a long-term loan on the rig (settle down Chuck, I can explain). So far the Blue Book value for the rig exceeds the principal on the loan, so I am not at present upside down. Roadtreks in general hold their value well, but my concern is whether this will affect the value going forward. Meanwhile, I like the machine very much and will continue to use it as much as I can. Keep smiling and press on.
It’s truly ironic, because in bankruptcy, guess who gets paid first? The administators of bankruptcy, you got it, the lawyers, appointed by the BK judge, a lawyer. Often, after their done carving up the pie, there is little if any, left over for the creditors. Tell it like it really is. Yes, management is at fault to a degree for sure in any busines failure, but the outright fleecing of the remaining assets (cash) is nothing short of theft.
It’s a shame these shysters` have created the network to fleece the system methodically. And, there is noway to stop em. Who you going to call on, ghost busters, lol.
Can I sue them?bought a 2017 carado Oxion RV Van.its still like new.were still paying on it.it has warranty.but I guess no more.its on paper,warty.so love to sue them.
Canadian laws with regards to bankruptcy and receivership are different from the US. They have gone to court and are officially in receivership. The documents are online for anyone to see. Erwin Hymer drove Roadtrek into the ground. This was once the best built product you could find. Here are the documents. https://www.alvarezandmarsal.com/sites/default/files/canada/issued_and_entered_notice_of_application.pdf
Sounds like the same thing with the icon Sears. That so called president ran that company deliberately down to the ground. With Sears it just rotted away. That did not have to happen.
And it’s only a matter of time before Mr Lemonis does the same thing to camping world.
Agree with Jeff. My bet is on Thor to swoop in for the fire sale and either finish it off as Jeff mentioned, or best case, use those factories and the displaced employees to expand their Airstream brand of Class Bs. Not holding my breath that one though.
Thanks for this post. It is good to read about the truth, especially from a legal stand point, about issue like these. Thanks to the RVtravel.com folks for adding Ron to the team of writers. I look forward to reading more post from Ron.
Ron: Thanks for the Great comments and insight!
As I see it, The BIG HAIRY, FIRE BREATHING MONSTER of THOR industries will come along shortly and buy up these remaining assets. Doesn’t mean they will make good on previous warranties or re-employ former workers, just buy the brand name (Roadtrek) and remove it from the RV industry or rebrand it under another name. In all likelihood, this Class B RV will never be seen again and there will be thousands of them for sale around the country. Too bad! Just a sign of the times.
Hi, it’s unlikely any buyer will be found. The EHGNA has $300 million in liabilities and does NOT own the two factories in Ontario. Thor excluded EHGNA after their due diligence found problems. Thor was after the European market, that they now have access to. Thor already has a huge presence in North America and no need to buy EHGNA.
BTW, the RV lawyer that wrote this article is not an expert in Canadian law. Our legal processes are not the same as America’s.
Steve