Winnebago Industries Inc. said it is getting rid of its fledgling commercial van business to concentrate on its mainstay - motor homes.
The move comes as the Forest City manufacturer struggles to return to profitability after eight straight quarterly losses.The commercial vehicle business, which began producing light trucks early in 1990, contributed to the drain on earnings.
"It didn't account for company revenue, that was one of the problems," Winnebago spokesman Robert Cooley said. "The market never developed, and during these economic times it probably wasn't going to to any extent."
The vehicles, priced from $25,000 to $35,000, were aimed at the baking, package, industrial laundry and similar delivery services.
Cooley said the business is for sale but that no one has expressed an interest in it yet.
The decision was announced in a terse statement Thursday.
"This action has been taken to help return the company to future profitability by concentrating efforts and resources on its core business of manufacturing motor homes," the statement said.
The company said it has expanded motor home offerings for 1992 and added, "Several new models have recently been introduced and are being well received at both the dealer and retail customer levels."
The company has 2,300 employees, and Cooley said the move to halt production of commercial vehicles would have no immediate impact on the payroll "because it has been such a small operation."
Despite the new focus on motor homes, Cooley said Winnebago will continue to keep its Cycle-Sat subsidiary that offers satellite distribution of television commercials.
Winnebago is to report soon on results of its recently concluded fiscal year. In the nine months ended June 1, the company had a loss of almost $19.2 million on revenue of $150.9 million. In the same period a year earlier, it reported a loss of $14 million on revenue of $249.2 million.