Warranty Affects Bottom Line

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John Hilley

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Mar 11, 2009
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It looks like the warranty problems we see on posts here, shows up in Winnebago's bottom line.

From RV Business "Fourth-quarter gross margin improved sequentially from the third quarter due in part to improved manufacturing efficiencies within the motorized group. However, year-over-year fourth quarter gross margin declined due to unfavorable trends in warranty expense, the establishment of a warranty recall reserve and costs related to motorized manufacturing inefficiencies."
 
And.... you can bet the farm on why Randy Potts is no longer CEO of Winnebago Industries.  I was recently chatting with a buddy of mine at Winnie (to remain an unnamed source) and they have been having a heck of a time attracting and retaining employees (which are production employees I assume affecting those sorts of warranty issues.)  Last year my shop manager buddy said he was down a bunch of techs (factory service.)

There's probably another major facet to the warranty woes they are having and that's the problems they are having with some of their vendor supplied stuff - Lippert (Schwintek) slide systems come to mind.  Some of those installations have been very problematic and a major cause of grief for owners and most likely Winnebago as well.

To be sure, they will turn the ship around.  Potts disappearing is a good indicator of the Board's determination to fix the issues.
 
John,
Great to see your total 180 degree reversal on Winnebago's warranty issues, including the issues they have had with the cheep Lippert products, slides, levelers, windows, CDI full body paint etc. Something I have expressed for almost a year now.
Hope Winnebago can get back to their old reputation!
 
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