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Lean Manufacturing and Flexible Assembly Are Ways of Life at Winnebago Industries

Lean production and vertical integration help the RV leader thrive.

August 5, 2014
Trans

The Music Man” takes place in a Midwestern hamlet called River City. The town that it’s based on is Mason City, IA, and the river that flows through it is the Winnebago. If you follow that river a few miles west, you’ll end up in Forest City, which is home to another American classic: Winnebago motor homes.

Winnebago is one of the most iconic brands in the world. The company is synonymous with well-built, high-quality recreational vehicles. It consistently ranks as the top-selling company in the $10 billion RV industry.

Winnebago Industries Inc. has grown from humble beginnings to become one of the largest motor home manufacturers in America with production capabilities unparalleled in the industry. Since the company was founded in 1958, Winnebago has built more than 400,000 motor homes.

The 56-year-old company attributes its success to loyal customers, a vertically integrated production process and an ambitious lean manufacturing initiative.

Winnebago builds a wide variety of motor homes under the Itasca and Winnebago brand names at a 200-acre manufacturing campus in Forest City, with satellite operations in nearby Charles City and Lake Mills, IA. In addition, the company assembles SunnyBrook and Winnebago brand travel trailers and fifth-wheel trailers at a plant in Middlebury, IN.

Unique History

Winnebago traces its roots to the mid-1950s. That’s when a group of local citizens formed Forest City Development Inc. to create an industry that would prevent young people in the small farm town in northern Iowa from moving to Chicago, Minneapolis and other big cities. They named the new company called Modernistic Industries and opened a travel trailer manufacturing plant to address the growing demand for recreational vehicles.

After the company ran into financial difficulties in the late 1950s, a local businessman came to the rescue. John Hanson was an entrepreneur who owned a furniture store and a funeral parlor in Forest City. The new company began producing Winnebago-brand travel trailers and changed its name to Winnebago Industries in 1961.

Hanson applied several lessons he learned from selling furniture and appliances. For instance, he borrowed the concept of applying a layer of Styrofoam insulation between an interior and an exterior panel, as was done with refrigerators and freezers. In 1963, Winnebago became the first RV manufacturer to pioneer a production process called Thermo-Panel, which sandwiched foam insulation between a plywood interior panel and an aluminum exterior wall.

Hanson also turned to Henry Ford for inspiration when he decided to adopt automotive-style assembly processes to the fledgling RV industry. In the mid-1980s, Winnebago ran an ad in magazines under Hanson’s signature touting “I learned a lot from Henry Ford. Most of my competitors still don’t get the idea.”

The full-page ad went on to explain: “The year I was born, Henry Ford’s Model T was selling for $825. Three years later, he’d cut the price to less than $400.

“He did it with his newest invention, the assembly line. It let him build a quality product for a lot less money.

“I tried the same thing with motor homes,” touted the ad copy. “My competitors thought I was crazy. But when my first units came off  the assembly line, I sold them at half the going rate.

“Today, we still have the most sophisticated manufacturing facility in the business. And most of my competitors still build the old fashioned way . . . .”

The first Winnebago motor home debuted in 1966. The 19-foot model built on a Ford chassis was soon followed by a 22-foot model built on a Dodge chassis. Both vehicles quickly evolved into best-sellers.

As sales skyrocketed, Winnebago quickly became America’s largest producer of motor homes, and the stylized ‘W’ logo became a common site at college football stadiums and national parks throughout the United States.

The newest vehicles in the Winnebago portfolio pay homage to the past. Earlier this year, the company unveiled the Brave and Tribute, which feature a classic design with a modern twist.

“Back in the 1960s and 1970s, there was no mistaking a Winnebago motor home with the distinctive ‘eyebrow’ design and flying W logo,” says Randy Potts, chairman, CEO and president of Winnebago Industries. “It was the motor home that made America fall in love with the RV lifestyle.

“The retro, yet modern image they project is fun; they offer great new features that are sure to capture the eye of new buyers,” adds Potts. “They breathe new life into the legendary design, providing the opportunity to relive childhood memories for a new generation of motor home enthusiasts”

Rebounding Market

After weathering several lackluster years during the recent recession, the RV industry is on a rebound. According to the Recreational Vehicle Industry Association (RVIA), manufacturers experienced a four-year high in 2013. Demand for motor homes surged 36 percent.

During the first six months of 2014, year-to-date shipments were up 11 percent over the same period last year. And, that trend is expected to continue through the second half of 2014.

“The strong growth seen in the RV market is due to a combination of the clear-cut affinity consumers have for RV travel and ownership, coupled with strengthening economic conditions that have seen rising home and stock values, and the improved availability of credit,” says Richard Coon, RVIA president. “Continued gains in jobs and incomes combine to boost consumer confidence.”

The Freedonia Group Inc. predicts that the RV industry will increase 5 percent annually to reach $11 billion by 2017. In addition to the rebounding economy, advances will be aided by demographic trends. For example, Freedonia expects to see continued growth among in 55- to 64-year-olds—the traditional purchasers of motor homes—as well as rising interest among younger consumers.

Technological advancements that improve fuel economy and ease of handling will also propel sales, in addition to a growing array of entertainment and comfort options, such as high-tech accessories and more home-like amenities.

While rising sales of high-end vehicles will drive up average prices, Freedonia analysts predictsthat smaller, entry-level motor homes will outsell them in unit terms. The South and West regions will continue to lead sales of RVs, accounting for 75 percent of all U.S. demand. Those regions are popular vacation destinations and are home to large populations of retirees, both of which benefit sales of motor homes.

Diverse Products

With more than 28 model lines and 88 floor plans available, there is an extreme amount of complexity to building Winnebago motor homes. Assemblers at the flagship plant in Forest City build a wide variety of Class A and Class C motor homes. They vary in size from 20- to 42-feet long, while retail prices range from $62,000 to $420,000.

Class A products, which typically resemble a bus in design and feature a vertical front end and large windows, come in two basic varieties. Products such as the Journey and Tour feature three axles and measure up to 42-feet long. They typically are powered by a 450-hp diesel engine mounted in the rear and can weigh up to 30,000 pounds.

Class A products also include shorter two-axle, gas-powered, front-engine models, such as the Adventurer and the Vista, which measure up to 36-feet long and weigh up to 26,000 pounds.

Class C products, such as the Aspect and Minnie Winnie, feature a commercial truck cab and an over-the-cab compartment. They typically measure up to 32-feet long, weigh up to 22,000 pounds and sleep up to four people.

Winnebago builds Class B products, such as the Travato, at its Lake Mills plant. The 20-foot-long touring coaches feature the same basic chassis and engine as a passenger van. They are designed to sleep two to four people.

No two vehicles moving down Winnebago’s Forest City assembly line are alike. In addition to traditional motor homes, assemblers build vehicles custom designed for special needs and requirements, such as bookmobiles, mini tour buses, mobile medical clinics and law enforcement command centers.

Many Winnebago products are equipped with all the comforts of home, including cushy couches, skylights, flat-screen TVs and gas fireplaces. Optional accessories include awnings, generators and home theater systems. Some motor homes have up to five TVs in different sizes, configurations and locations. That makes assembly challenging, because several types of mounting brackets must be used.

“Training employees for each unique floor plan is a challenge,” says Daryl Krieger, vice president of manufacturing. “We are also challenged with storage of all the component parts needed in a limited amount of space.”

Different types of materials are found in motor homes rolling down Winnebago’s flexible assembly lines. For instance, laminate countertops are used in some vehicles, while others utilize Corian countertops. Vinyl flooring is used in some motor homes, while porcelain tile is used in top-of-the-line models. Customers can also choose among different types of fabrics used in furniture and wood finishes for cabinets, in addition to exterior paint and graphics.

Many Winnebago motor homes are equipped with electrically actuated slide-out mechanisms that greatly expand the floor plan. At the push of a button, walls slide out up to four feet on either side of a motor home, creating extra space inside. Some motor homes are equipped with up to four slide-out sections.

“Our product-driven process has allowed us to develop new products more rapidly, allowing us to be more nimble and responsive to the marketplace,” says Potts. “We have long been known as an industry leader in innovation, as each year we introduce new or redesigned products. These changes generally include new floor plans and sizes, as well as design and decor modifications.”

“From prerecession to post recession, our products have become a lot more complicated,” adds Krieger. “For instance, we now have a lot more slide-out rooms, more electronics, audiovisuals and complex electrical systems. It’s not the same motor home that we built 10 years ago.”

That high mix adds complexity on the assembly line. To address that challenge, Winnebago implemented a lean manufacturing strategy 14 years ago. Today, it’s production prowess is unmatched in the RV industry.

Lean Thinking

Lean production systems have allowed Winnebago to stay No. 1 in the competitive motor home industry. “They’ve helped us become more flexible and respond to market demands much quicker than our competitors can, and with better quality,” says Krieger. “Lean manufacturing allows us to move the production of particular products from one line to another because work areas are set up similarly between lines.”

Winnebago’s main assembly building boasts 429,000 square feet of production space. In addition to subassembly lines where operators build sidewalls, wiring harnesses, bathrooms, galleys and other components, the building houses three parallel moving assembly lines, each 900 feet long. A tow-line conveyor moves approximately 15 inches per minute and every motor home moving down the line is different.

“We can easily rotate models from line to line and mix products,” notes Krieger. “For instance, we can run A-body gas pullers on the same line that assembles diesel pushers. This flexible assembly strategy is a different model than what a lot of our competitors use.”

“Lean manufacturing has helped us become more organized and allowed us to set up our work areas with better flow and less wasted movement,” adds Terry Rodberg, general manager of fabrication.

“We have purchased a lot of equipment recently, such as a new state-of-the-art laser metal cutting system, that enables us to quickly change when our products change,” Rodberg points out. “It gives us the flexibility to build smaller part quantities with less scrap.”

Winnebago has also made a big investment in cordless tools. In fact, approximately 75 percent of the fastening tools used on the main assembly lines are battery powered.

“Cordless screwdrivers and impact drivers offer a tremendous advantage when working inside vehicles,” says Rodberg. “Assemblers don’t have to drag air hoses in and out. That prevents trip hazards and avoids marring the surface of furniture and cabinetry.”

Traditional torque-controlled, air-powered tools are primarily used to fasten critical joints on the chassis line, which is housed in a 275,000-square foot building that includes a metal fabrication department. Cab structures for Class A motor homes are manually assembled in the facility with tungsten arc welding equipment.

When cab frames are ready, assemblers attach dashboards, wiring harnesses, windshields and other components on a mezzanine before the cabs are lowered by hoist to the chassis line below. Rolling chassis ride on a slat conveyor as assemblers attach floors, electrical wiring and plumbing systems. They also install slide-out mechanisms and other components before the chassis are driven next door to the final assembly line, where bodies are attached and interior trim is installed.

During the recent recession, Winnebago engineers took advantage of the slowdown in production to enlarge the area where the cab drop takes place.

“Over the past several years, our motor homes have become much larger than some of our assembly areas could efficiently accommodate,” says Rich
Honsey, chassis line manager. “The recession allowed us to retool an idled assembly line to more efficiently build the larger, more complex units.

“Changes to the assembly line, which included extending the opening in the mezzanine above the assembly line in our chassis prep facility, allowed us to install the steel cab and lower floor structures onto the motor home chassis earlier in the assembly process,” adds Honsey. “This created much better work flow on the line.”

Vertical Integration

Winnebago prides itself on its vertically integrated manufacturing philosophy. Items such as furniture, holding tanks, bumpers and galley cabinets are built in-house.

In fact, a few of the only things that Winnebago doesn’t make itself are the engine, power train and heavy-duty chassis. It buys those from Chrysler LLC, Daimler, Freightliner Custom Chassis and Ford Motor Co.

Winnebago’s manufacturing campus includes numerous buildings, such as Creative Aluminum Products Co., which produces extrusions used to make windows, ladders, screen doors and other items. The Rotocast division molds holding tanks, fresh water tanks, luggage compartments, heat ducts and wheel wells, while an injection molding facility produces plastic shower stalls, dashboards and tail light housings.

An in-house fiberglass shop manufactures exterior components, such as front ends, roof caps and back wall parts. The Stitchcraft division provides soft goods for Winnebago motor homes, including chairs, sofas, cushions, draperies, shades, foam mattresses, bedspreads and trim panels.

A sawmill and cabinet shop supply doors, cabinets, laminated panels, countertops and other wood components. Everything produced in the facility travels on an enclosed conveyor to the main assembly line. Winnebago also boasts its own test track, which includes bumps, water hazards and a hill.

“We began our vertical integration soon after the company was founded,” says Bruce Heusinkveld, production manager. “Due to our remote location, we didn’t have a supplier base nearby. We decided to manufacture our own component parts so we would have better control over the delivery and quality of parts.

 “Vertical integration helps us remain very flexible and to control the quality of our components,” adds Heusinkveld. “We can make changes a lot more quickly on components built in-house compared to parts that are outsourced.” 

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