Competitors may see increase in orders as area foes fall

By Tricia Pursell
The Daily Item

November 08, 2008 07:33 am

— Remaining Valley modular housing manufacturers are doing their best to stay afloat amid a shaky economy that has caused about 600 area employees in October alone to receive news of layoffs from Wood-Mode, Fleetwood Enterprises, and most recently, Crest Homes in Milton.
Employees at Crest Homes were notified Oct. 16 that the plant would close Dec. 15 because of the "worsening economic condition and declining home orders."
Apex Modular Homes Inc., in Middleburg, laid off about 100 of its approximately 300 workers earlier this year because of the decrease in demands for housing.
According to Vice President Lynn Kuhns, the company has since then called some of those employees back to work.
"We're holding our own," he said, "and we've done things as a company to help us survive and get through. We're providing 40-hour weeks for our employees, and we've got a decent backlog if everything holds."
He said the company is scheduled out through the end of December.
Under normal circumstances, Apex produces and sells about 650 to 700 homes a year. Under the present economic conditions, Kuhns says the number will probably be in the 350 to 375 range.
With the closing of Crest Homes, other housing manufacturers will most likely experience a little relief.
"I don't like to see any company go under," Kuhns said. "But it will definitely help in this market condition. This will definitely help the surviving manufacturers.
"It's like a big team," Kuhns said. "All the manufacturers are all competitors, but we're all working together and fighting to get as much market share as possible."
Kuhns blames the downturn in the economy as the reason for the housing industry woes.
"With the clientele and the difficulties that home buyers face with new regulations in banking, it's becoming extremely difficult," Kuhns said. "Few people have the resources to come up with the 20 to 25 percent of the money to buy a house."
He said this is a good situation for home buyers because home builders are offering reduced costs in order to keep their employees and maintain status.
When modular housing industries begin to sink, so do the businesses that provide supplies for the housing, such as those making or distributing furniture, wood, concrete and fabricated metals.
"It's a trickle-down effect," Kuhns said. "Some of the local suppliers will have to lay off people and downsize in order to survive."
Apex Homes tries to buy a majority of its supplies from local companies, Kuhns said.
Central Pennsylvania has been an excellent location for the manufactured-housing industry, said Mary Gaiski, executive vice president of the Pennsylvania Manufactured Housing Association in New Cumberland.
A stable labor force and accessibility to major transportation routes, coupled with the availability of large plots of land for storage, made the area desirable, she said.
Homes manufactured in the region are shipped as far north as Maine and into the Carolinas to the south.
At the peak of production, about 16,000 units per year were manufactured statewide, but production is down about 40 percent, Gaiski said.
Three other local modular housing manufacturers were contacted, but either the calls were not returned or they did not wish to speak about the issue.
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