RV dealer association offers coping tactics to Hymer dealers

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The RV Dealers Association (RVDA) issued this statement this week in response to the sudden closing of Erwin Hymer North American operations. The Canadian company manufactured the Hymer and Roadtrek brands of motorhomes. In 2017, the company led the North American market for Class B motorhomes with more than 32.5% of the retail market share in North America and more than 56% in Canada, according to Statistical Survey Inc.

The RVDA statement
Erwin Hymer North America, the company that built Roadtrek- and Erwin Hymer-brand motorhomes in Ontario, Canada, ceased operations on Friday (February 15) when it fired all employees at its two factories, according to news reports from Canada.

This will create challenges for the dealers who sold these units in the past, or who have new products in inventory. Based on the past when manufacturers cease production, dealers can easily find themselves owed tens of thousands of dollars from a manufacturer for warranty reimbursements and incentives that become virtually uncollectible once the manufacturer ceases its business operations.

Class B motorhomes built by Erwin Hymer North America carried a six-year warranty, according to CTV of Kitchner, Ontario. The Canadian TV station interviewed a couple that recently bought a Roadtrek brand Class B which needed minor repairs a few weeks ago. Concerned about whether their warranty coverage still was in effect, they called Roadtrek and were told to get the repairs completed, keep receipts and to contact Erwin Hymer North America after an audit was completed. However, calls to the manufacturer by other motorhome owners and the TV station were not returned.


Erwin Hymer North America was audited because Thor Industries Inc. refused to buy the North American portion of Germany’s Erwin Hymer Group SE after financial irregularities were reportedly discovered at the Canadian operation a few weeks ago.

So, how can dealers handle sales of existing units, warranty obligations, financing and some other issues when a manufacturer goes under?

RVDA offers the following considerations to dealers:
• Discuss with your dealership’s attorney the possibility of titling the out-of-business manufacturer’s units in your dealership’s name, and selling them used with a limited express warranty, or “as is.”

• Ask your service agreement provider if they provide or sell extended protection for out-of-business manufacturers’ units. For instance, Protective’s XtraRide offers a 12-month service agreement should the manufacturer’s warranty be unavailable. Dealers may also sell the customer a longer term service agreement in addition to the 12-month term. XtraRide is exclusively endorsed by RVDA.

• In some states, it may be illegal to sell a new vehicle without a warranty, or to sell a vehicle as new if the manufacturer is no longer licensed to do business in the state.

• If you sell the vehicle as new, there needs to be full disclosure as to the manufacturer’s inability to pay for warranty work, and likely, a prominent disclosure on the vehicle and on the bill of sale.

• Review your contracts with consumers who bought units built by the out-of-business manufacturer to see if you assume responsibility for the warranty work. In some cases, paperwork may indicate that the only warranty is the manufacturer’s warranty, and only the manufacturer is responsible for warranty work.

• For consumers who have already purchased a Roadtrek unit and are bringing it in for repairs, a disclaimer should be signed in which the consumer acknowledges that if the dealership attempts a good-faith repair of any alleged defects, that the dealership is not assuming any express or implied warranties provided by the manufacturer.

• Check with lenders on financing options. In the recent past, some lenders have told dealers they will not accept financing requests for new or used units built by manufacturers who had gone out of business.

• If a bankruptcy reorganization turns into a liquidation, discuss with your dealership’s attorney whether your good faith effort to repair a customer’s warranty issue, without seeking reimbursement, is inconsistent with your disclaimer of implied warranties, and whether you may be obligated for additional repairs.

RVDA will provide additional details on the Erwin Hymer North America situation as they become available.


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Dry Creek
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Dry Creek

“In 2017, the company lead the North American market for Class B motorhomes with more than 32.5% of the retail market share in North America and more than 56% in Canada, according to Statistical Survey Inc.”

*Led*. The company *led* the North American market.
Ack! Lead is what made gasoline great and paints mildew-proof.
If you want to use “lead”, (with the long E), you could have stated: “A leading company in the North American market for Class B motor homes”.

RV Staff
Admin

Thanks, Dry Creek! That one slipped by me. It’s been corrected. “Ack” is right! I hate it when I miss obvious stuff like that! Have a good night. 😀 —Diane at RVtravel.com

Dry Creek
Guest
Dry Creek

That’s OK, I see it more and more these days.
Ahh, the travails of a technical writer (who’s forced to also perform technical and administrative reviews on co-workers projects).

RV Staff
Admin

Hey, Dry Creek. I didn’t say I wrote it — I just didn’t catch the error. I’m not a writer, and definitely not a technical writer — which does make it fun/interesting/challenging when proofing electrical/tire safety/astronomy/etc. stuff. Good thing I love to learn. Have a good night. 😀 —Diane at RVtravel.com

Mike Sokol
Editor

Sometimes I add grammatical and spelling errors in my RV Electircity articles just to give Diane something to do. Your welcome, Diane…

RV Staff
Admin

We weren’t talking about you (this time), Mike. And I know you did that on purpose! I’m going to leave your comment “as is.” You’re welcome. 😀 –Diane at RVtravel.com

Willie
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Willie

Thank god. or whomever. that you didn’t type: “Your welcome.” 🙂

RV Staff
Admin

Ha! Yeah, I knew that Mike had “planted” that one in there to see if I would correct it! He frequently tells me he puts typos in his articles so that I feel useful. Ummm, OK … whatever. We frequently play spelling/grammar “games” — keeps things interesting. Right, Mike? Thanks, Willie! Have a great day. 😀 —Diane at RVtravel.com

Colin Grant
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Colin Grant

If I was in the market for a new B I would definitely be looking at a Road-Trek. Grind a great price for a new vehicle without a warranty but make sure everything works before you accept delivery. I do my own repairs anyway because getting repairs done at a dealer is ridiculous with the wait time of most repair shops. If the closest dealer doesn’t offer a good deal go elsewhere because you are not tied to the dealer anymore. There will be fire sales among the dealers you just have to be willing to travel and have your… Read more »

Bill T.
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Bill T.

“Can’t get blood from a stone.” I didn’t read anything in the article about the folks who had rigs, already at the dealer, for warranty work and how the dealer is not going to release the rig to the owners, without any monies paid for that warranty work. Litigation could be going on for years while folks are paying for a rig to sit on the dealers back lot. Where will they turn for help, or will they forced to eat the costs of repairs themselves?

Patrick Granahan
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Patrick Granahan

Most if not all RVs are composed of parts from various manufacturers. The units pictured have chassis built by Mercedes Benz (they are still in business). Every component in every RV seems to be supplied from the same group of Manufacturers….items like refrigeration, water heaters, air conditioners, microwave ovens, toilets etc.,etc.,etc. If components fail contact that component manufacturer and discuss warranty service. I am sure Mercedes Benz will stand behind their product. The only issue is who pays for repairs during the individual product’s warranty coverage period. It is not like every component in the RV is going to fail… Read more »