Road tested

Fredric M. Zinn is president and CEO of rebounding Drew Industries Inc. in White Plains, which makes parts for RVs and factory-built homes. But he”™s no Cousin Eddie and neither are his customers.

“That”™s just a stereotype,” Zinn says of the homeless Randy Quaid character in “National Lampoon”™s Christmas Vacation,” who plants his rusty RV outside the home of his put-upon relatives. “It doesn”™t fit the profile.”

Contrary to recent media speculation that more RV owners may be going the way of Cousin Eddie in these thorny times, Zinn says: “Most people don”™t live in RVs. They”™re designed for vacations and taking trips to a national park or a football game.”

Indeed, the typical RV purchaser is a middle-class resident of America”™s wide open spaces, with enough discretionary income for a price tag that can range from $10,000 to $75,000 but generally averages $25,000.

The good news is that there are more like him today, despite the continuing jobless recovery.

“Last year was a tough year for our industry as you can imagine,” Zinn says. “This year, there”™s been a significant improvement in our business”¦.”

For the first six months of this year, industry production of towable RVs ”“ the lion”™s share of the RV market, which also includes motor homes ”“ was up 88 percent over the first six months last year. In the same period, Drew”™s sales of components for RVs ”“ 85 percent of its business ”“ were up more than 100 percent, while company sales of components for factory-built homes were up 26 percent.

With more than $50 million in cash in the bank and no debt, Drew is in the driver”™s seat.

How did the company do it?

Zinn says Drew grew its market share by acquiring dozens of mom-and-pop operations, selling to more producers and developing new products:

“A decade ago, RVs were less feature-driven. Now that”™s changing.”

Along with new types of entry doors, improved suspension systems and sleeker windows, there”™s a lighter slide-out mechanism to save space and one that makes a flat-screen TV rise or disappear.

“There”™s also a leveling device so that when you cook your eggs, they don”™t slide off the pan,” Zinn says. “All of these things make an RV more fun to be in. That”™s the goal.”

Surely if anyone would make a fun RV companion it”™s the amiable, avuncular Zinn, who”™s been with the company for almost 30 years, having come over from the global auditing firm of KPMG.

He rolls out the facts and figures that chronicle his company”™s course with the same fluid, soft-spoken ease he uses to discuss baseball. A Brooklyn Dodgers”™ fan who converted to the New York Mets, Zinn has an office that is nonetheless punctuated by Da Bums”™ memorabilia, including photographs of centerfielder Duke Snider joyously leaping in the air and Jackie Robinson being tagged out by Yogi Berra at home plate.

There”™s a certain irony in that and in the idea that Zinn himself does not own an RV, though in his defense there”™s probably little call for one in Fairfield, Conn., where he makes his home with wife Ronni, a Fairfield High School teacher. Maybe he could get a towable RV for Mets”™ home games.

While there may be a certain humor in that, Zinn knows firsthand that the continuing recession is no laughing matter.
As with some other companies, Drew is much better off than it was last year but not where it was pre-recession, with sales down 25 to 30 percent from 2006. Back then, the company had more than 4,000 employees. In the depths of the recession, that number shrank to 1,900. Now it”™s back up to 3,300.

Still, two-thirds of Drew”™s 24 RV plants are located in one of the areas hardest hit by the recession ”“ northern Indiana.

Zinn looks for more general volatility in the next few quarters. Nonetheless, he is heartened by the notion that young families are buying RVs, with thirtysomethings the fastest-growing segment of the purchasing population.

And he knows that given the company”™s cash-flow strength and zero debt, Drew is ready for whatever road lies ahead.