Well, This Hasn't Gone Well

Part Twenty Eight – A Surprise Ending That No One Expected

Those who know anything above the RV industry probably know everything they want to know about this news. As of February 15, 2019 – Roadtrek / Erwin Hymer Group NA no longer exists. Very shortly after this announcement, the roadtrek.com website is gone, all of their nearly 1,000 employees have been laid off, and the gates to all of their Kitchener plants have been padlocked. 

It’s was a stunning development that has taken us as well as the thousands of owners by surprise, who are now left high and dry without any answers. The events that led up to the meltdown on the surface spanned only a few weeks, but what was happening within the company was something that was likely stewing for years. 

Let me first be up front and say that I know very little about the Erwin Hymer / Roadtrek company. I’ve compiled my information from news articles and Canadian news outlets. We were just trying to understand what could have happened to such a promising company. I do know that right around the time that Roadtrek agreed to replace our van in early 2016 they were also in the process of being purchases by a German based recreational vehicle manufacturer called Erwin Hymer Group. They were a very large and well respected company in Europe, so at the time it was promising news to think that a well established company was here to make positive improvements to the Roadtrek Brand.

The newly established Erwin Hymer Group North America had big plans for the American market. They first began to build the Hymer branded motorhomes out of the Roadtrek facilities. Other brand names were launched from this new company, including Carado and Sunlight. Between 2016 and 2019 the company expanded quickly, leasing additional warehouse space and hiring hundreds of new employees. According to news reports they had nearly 1,000 employees as of early 2019. 

In recent months rumors began swirling about Thor Industries looking to purchase Roadtrek / Erwin Hymer Group NA. It was apparently during this purchase process that things began to unravel. You can find many articles that better describe in detail the events that unfolded. I’ll provide a summary, but I’ll also provide links to the articles and news reports that kept us informed throughout the ordeal. 

The meltdown began coincidentally the same week as the huge RV show in Tampa Florida. From the outside everything looked great for the Roadtrek / Erwin Hymer. Roadtrek debuted a brand new model called the Haven, which is the first Roadtrek to be built on the Ford Transit Chassis. It was day two of the Tampa show that we got our first news of problems for the company:

January 16, 2019 

Canadian CTV News reports that nearly 100 employees were being laid off from the company effective immediately. A letter given to employees cited that an economic downturn was not anticipated and resulted in a drop in sales. Most if not all of these employees were just hired within the last three months.

https://kitchener.ctvnews.ca/mobile/employees-say-nearly-100-to-be-laid-off-from-manufacturer-1.4256400?fbclid=IwAR06L0NDb9gCDCoy16anX00pimvaI0FWTntS0uJU__wXvq9OT2IqhltxP9U

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January 17, 2019

Reports began coming out that several top executives from Roadtrek / Erwin Hymer Group NA were escorted from the building and suspended, including company president and CEO Jim Hammill, who was reportedly on sick leave at the time.

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January 18, 2019

Canadian news began reporting that “financial irregularities” were discovered during an audit that Thor Industries and / or Hymer was conducting in preparation for the purchase of the company. It was reported that 1,700 invoices may have been fabricated, and those fraudulent invoices could account for as much as $100 million in value. It was also reported that family members of high level executives were on the payroll, but didn’t officially work for either Roadtrek or Hymer.

https://rvdailyreport.com/industry/erwin-hymer-north-america-rocked-by-scandal/

From a press release issued by Erwin Hymer Group:

We wish to inform you about recent developments in our company. Erwin Hymer Group (EHG) is currently reviewing the business of Erwin Hymer Group North America (EHG NA). An initial investigation has shown irregularities in the company’s reporting. We have initiated a detailed audit procedure involving external auditors. Erwin Hymer Group is acting in accordance with its zero tolerance policy and is committed to a full and complete investigation. While the matter is investigated, several managers have been suspended pending the outcome of the investigation.

As an immediate measure we assigned Robert Quine and Thomas Martin to support the ongoing operations of EHG NA and the external investigation.Thor Industries has announced that it expects that the purchase of Erwin Hymer Group will be completed within the company’s fiscal third quarter ending April 30, 2019. Due to the ongoing investigation, Thor Industries and EHG’s selling shareholders are finalizing discussions to exclude EHG’s North American operations from Thor’s purchase of EHG.

We are fully aware that this news generates unease and raises concerns. It is our objective to keep uncertainty as low as possible and we expect to have a full assessment of the situation in the coming weeks. We will inform you on further developments. Please be assured that we are doing everything we can to minimize any potential impact of this situation on our customers, business partners and employees in North America.

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January 21, 2019

Thor Industries announced that it would exclude the North American portion of the Erwin Hymer company from the purchase agreement. 

From a press release issued by Thor Industries, Inc.:

ELKHART, Ind., Jan. 21, 2019 – Thor Industries, Inc. (NYSE: THO) today provided an update on its pending acquisition of the Erwin Hymer Group (EHG).  The Company announced that Thor and the sellers are finalizing discussions to exclude EHG’s North American operations from Thor’s purchase of EHG.  Thor and EHG are currently negotiating appropriate revisions to the terms of the stock purchase agreement including adjustments to the purchase price and assumed liabilities as a consequence of the exclusion of EHG’s North American operations.

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February 1, 2019

Thor Industries announces the closing of Erwin Hymer Group acquisition. 

From a press release issued by Thor Industries, Inc.:

ELKHART, Ind., Feb. 1, 2019- Thor Industries, Inc. (NYSE: THO) today announced it has completed its acquisition of Erwin Hymer Group (EHG), one of Europe’s largest makers of recreational vehicles (RVs), effective February 1, 2019. The combination of Thor and EHG creates the world’s largest RV manufacturer, with leading positions in both North America and Europe. The acquisition excludes EHG’s North American businesses, and reflects a €170 million (approximately $194 million) purchase price reduction and a €180 million (approximately $205 million) reduction in the obligations the Company would have otherwise assumed under the terms of the original stock purchase agreement.

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February 15, 2019

Erwin Hymer Group North America filed for receivership, which is essentially another term for bankruptcy. They terminated the remainder of it’s workforce, catching both employees and RV owners by surprise. Not only did it upset the entire economy in the Kitchener area, it left us RV owns in a panic, with no one there to answer questions like; will anyone be able to service my RV? What happens when a proprietary part breaks and we can’t source a replacement? 

Below is a link to the law firm handling the receivership matter. You can read up on all of the court filings, as well as a complete list of the creditors which to date is almost $300,000,000. 

https://www.alvarezandmarsal.com/ehgna#intro

It’s a tragic ending to a brand that promised so much to so many people, and it wasn’t even the poor quality control that killed the company. We feel extremely sympathetic to the employees and vendors that worked so hard, only to be left high and dry. There were also hundreds of vendors that were stiffed for millions of dollars. When a company goes into bankruptcy no one comes out a winner, and from what I’ve read so far in the court filings – this was a painful blow to many.

Let’s not forget that 6 Year Piece of Mind Warranty that has been a top selling point for the Roadtrek and Hymer brand – not a single Roadtrek buyer received the full term of that warranty. We were afraid to make any repairs on our own in fear of voiding our warranty, and in the end it didn’t even matter. 

While things didn’t sound promising, there was a glimmer of hope for the Roadtrek brand. The company remained in receivership status through the end of March 2019. During this time someone could provide a proposal to purchase the company and revive the brand at some point in the future. If a buyer was not secured within the period of receivership, the remaining assets of the company would be liquidated.

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June 17, 2019

The Canadian courts formally approved the sale of Roadtrek to the France-based manufacturer Rapido, which also owns the Westfalia brand. You may remember the name which was popular back in the 60’s and 70’s. It’s still not announced if the Westfalia will be reborn in North America. 

As of this writing the “new” Roadtrek is still in the rebuilding process. The Roadtrek owners have been promised parts availability in the near future which is great news. What isn’t great news is the thousands of customers that lost their warranty when the company folded. 

In a surprising gesture, the new owner agreed to offer a 2 year warranty for up to $1,500 in repairs for those who purchased their Roadtrek prior to the announcement of the receivership. This warranty was not offered for any of the other Hymer brands including the Carado and Sunlight. 

In July of 2019, Rapido announced that they were excluding the warranty on all CS Adventurous, TS Adventurous, RS Adventurous and E-Trek models with second row seating built on the Sprinter chassis. This was an issue with models built betwwen 2013 to 2019. Roadtrek installed safety restraints on the second row seating that did not meet the requirements of Federal Motor Vehicle Safety Standards. Owners were notified and advised not to transport people in the second row sets until the problem is corrected. As of this writing there is still no fix for this issue.

We may never know what really happened behind the scenes at Roadtrek that led to its demise. We’re excited to see what Rapido brings to the Roadtrek brand. It may take a year or two but Roadtrek will come back. With better leadership and a focus on quality control, there is no doubt that they will find their niche in the Class B market once again.

2 Comments

  1. Terri

    Wow! You went through hell and back. Thank you for sharing your ordeal. I was thinking of buying a used road trek cs adventurous 2017 for a great deal. I guess the warranty is void. Lol. Any advice you would offer? Also, what do you own now? Have you thought of making your own conversion with less moving parts? Ie dry toilet, etc

    • CBW

      We love the concept of building from scratch, but at this point, we just don’t have the time available to put in to really researching and constructing our ideal rig.
      We haven’t posted an update in some time, but we just arrived back from picking up our new RV! After an excruciatingly long wait, we are finally the proud parents of a new Leisure Travel Van Unity Rear Lounge model, and so far, it’s everything we’ve spent the last few years hoping it would be. We’ll post a more detailed update soon, but that’s where we are now. And speaking to your considering a CS Adventurous, I would say if you’re willing to put in the time and effort to tinkering and fixing things that may (probably will) go wrong, it could be a fine purchase. But if not, I wouldn’t say you were wrong in reconsidering.

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