Amazon Opens New Facilities In Elkhart, Indiana
Elkhart, Indiana has long been a major center for RV manufacturing in the US. In fact, workers travel from far and wide to work in Elkhart, where the unemployment rate is only 0.9%.
But a new player has announced plans to open two new facilities in Elkhart. In October of 2021, Amazon announced it would be opening two new facilities in Elkhart. With Elkhart’s labor force already so occupied, and RV and boat manufacturers facing labor shortages, what effect will Amazon’s plans have on the industry there?
Let’s take a closer look at Amazon’s plans in Elkhart and how they might affect the RV manufacturing industry in the area.
The new Amazon fulfillment centers
The first facility is a huge 800,000 square foot Amazon fulfillment center that will be located on the Indiana Toll Road. This will be joined by a smaller delivery station close to the Elkhart Municipal Airport. Both are expected to open in 2023.
Amazon has invested over $200 million in the projects and promises starting wages of $18 per hour plus benefits. The fulfillment center will primarily use automation and robots, but Amazon is still expecting to hire around 1,000 workers for the two sites.
This isn’t Amazon’s debut in Indiana, either. They’ve invested over $15 billion across the state since 2010 and have created over 20,000 jobs there. They’ve also helped create another 29,000 indirect jobs in industries like construction and logistics.
With such a strong investment in Indiana, it’s no surprise they’re growing their involvement in the state with these new facilities. But could these new facilities have an effect on the existing RV manufacturing industry in the area?
How could Amazon affect RV manufacturing in the area?
Elkhart is already a major center for RV manufacturing as well as boat manufacturing. And at present, the Elkhart-Goshen metropolitan area has the nation’s lowest unemployment rate at only 0.9%. On top of this, 40,000 workers come from outside the county to work there every day.
In fact, RV and boat manufacturers in the area are already facing labor shortages, just like many other industries nationwide. And if Amazon is able to draw away workers from these industries, that labor shortage might get much worse.
In a worst-case scenario, this could mean the decline of RV manufacturing in the area. If manufacturers aren’t able to find workers, they may be forced to close up shop or move elsewhere. Even if things don’t get as dire, there could still be some decline in the local RV manufacturing industry.
However, officials from Elkhart are optimistic. For the Elkhart County Board of Commissioners, this is an opportunity to diversify the local economy and foster local growth.
In fact, many are hopeful that Amazon’s new facilities will draw in even more workers from outside the area, rather than stealing workers away. With so many commuters already coming to Elkhart to work, and the fulfillment center’s convenient location on a major highway, there’s good reason to be optimistic.
On top of this, Amazon’s $18 per hour starting wage is lower than RV manufacturers in the area, who are hiring at $20+ per hour. While Amazon does have attractive benefits policies, there’s a good chance they’ll struggle to pull workers away from the RV industry in Elkhart.
If things work out as officials hope, there will likely be little to no impact on the local RV manufacturing industry. In fact, if Elkhart does see local growth and an increase in workers coming from outside areas, the industry could even grow.
RV manufacturing in Elkhart is here to stay
While some have voiced concerns about where Amazon will find workers in Elkhart County, there’s likely no reason to worry.
While Amazon might be an attractive option for many workers, they’re unlikely to draw away too many from the RV manufacturing industry in the area. Especially considering the fact that the RV industry there is paying better wages than Amazon is offering.
While in a worst-case scenario the RV industry in Elkhart might lose some workers, there are unlikely to be any major ill effects in the long term. We won’t likely see the end of the RV manufacturing industry in Elkhart any time soon.
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Nothing was mentioned as to how these units are going to be delivered! The RV Transporters are dropping like flys, due to low hauling rates and DOT interference. Would like to see something written on this subject as well. Look at this No Transporters to deliver Units Dealers will not buy from them… units will set in the fields.
This subject has been talked about a lot on the OEM side with Amazon and the battle for workers right now, but realistically, Amazon will not disrupt much at all. The RV industry historically goes from paying workers a very large hourly wage that just continues to climb as they battle each other for employees during high demand periods, then as the market slows, workers are laid off and hours / production days are cut from 5 days a week to 3 or 4 days as demand slows and the number of units produced decreases. Because the industry is 100% based on lucrative income for customers, the mentality of the industry is to produce as much as possible and make as much money as possible when they can because the demand can change what feels like, overnight. During the slow times, companies like Amazon will receive an influx of workers who cannot afford to go from making $50+ a hour to making nothing in a downturn. They need some type of income and can’t afford to wait for demand to return because of the lifestyle they’ve created for themselves when making such a great income while working at a RV plant. Then when demand returns and the cycle repeats, these workers will quit Amazon and return to the RV factory because of the much larger hourly rate. Amazon will most likely offer better benefits with their positions, but money will trump that with the workers in this area. That being said, some of these workers may stay at Amazon because the work won’t be as grueling, mentally and physically, but I believe most will return to the RV factories. And, of course, you will always have that person who doesn’t want to work in a RV factory at all and want more consistency financially. They are probably very excited to work for a company like Amazon, but overall, I do not believe this will affect RV manufacturing at all in this area. Unless, the $400 billion Amazon decides they want to pay workers more then RV companies do and completely destroy the RV industry by just buying the whole industry just because they can, then they would definitely make an impact! So unless Jeff Bezos has a vendetta against the industry or Amazon decides they want to start selling RV’s online, I do not see that happening! What could happen is the opposite and people that are attracted to the area because of employment at Amazon, find of how much money people are making in a RV factory, with shorter hours, they might leave Amazon’s $18/ hr, 8 hour workday to $50+/ hr. 6 hour workday in a RV factory . Realistically, I could see that happening more than the other way around! But again, Amazon is one of the largest companies in the world and is probably not too worried about the RV industry or they wouldn’t have built their facilities here. I am sure they have a small army of people who have done their research of the area, knows all this information before a location of where they would build their facilities here was even chosen, and do not appear worried at all about the RV, boating, or manufactured housing industry here. Who knows… maybe there’s a future where people are ordering their homes and RV’s off of Amazon like Sear’s offered in their catalog with housing way back when! You never know!
I can remember a day back in 2007-2008 when a national story was run about Elkhart County having the highest unemployment rate in the country hovering around 32%. This time was in the depths of the financial collapse in Wall Street, but also collapse of the housing market. There is no guarantee that this won’t happen again with gas prices at historic highs with no prospect of returning to the pre-Biden prices of $ 2.00 to $2.50. When it costs me over $ 100 for every fill up of my F250 and I’m getting 8.2 mpg pulling a 5th wheel, the budget is real strained. As the saying goes, don’t look a Gift Horse in the mouth. Take whatever Amazon offers. Maybe the RV industry will start sourcing more domestic components into the RV’s instead of installing China bomb tires, power jacks for travel trailers and even the cloth pouches that the manuals are in. All in the name of trying to save of buck. I bought a Forest River product from East to West and they could care less what buyers of their products thought. Well, I kicked it to the curb for my beloved Grand Design Reflection 5th wheel. GD listens.
Living in Indiana I don’t believe you understand how the RV companies operate here. One might have a job for awhile however when the parking lots are filled with finished models the layoffs begin. They buy materials in bulk to save a nickel, mass produce and park them, hoping they have an economy that will buy them. If not its a massive sell off and layoffs. With inflation getting worse, don’t buy one now. Wait for the selloff. The hourly employees always lose.
A most of the rv companies are 30+ an hour and many of those are 40+ an hour so good luck pulling then away for an Amazon job.
I don’t think it’ll ruin it. If anything it may help it. I’m a full time RV’er as well as a moderator for RV sites. The RV’s that has been manufactured the last 4 years are crappy. Just not what they were. People are buying new RV’s and having issues within weeks and it’s taken months to fix. Not just one company, but many companie. New RV’s cost almost as much as a house these days. I’m hoping this will maybe wake the manufactures up. Also the Citizens should have more choices to work at. I think it’ll even out once done realize they may not like Amazon.
With gas soon to be $6+ a gallon the 12 people needed to continue producing campers will be available.
The RV industry has been working towards exiting elkhart long before amazon announced their arrival. Dometic is the latest to announce almost 160 jobs were being shed from their elkhart facility. Apparently they plan on using cheap labor elsewhere, only to ship the product right back here. I wonder if they regret that decision in light of recent developments involving transportation issues and the rising costs of fuel….
We have been looking for a new RV lately. The quality of the models we have been looking at has been dismal at best. Pure junk. Yes, we understand that the industry can’t find employees to build this stuff, but, if you can’t build them right in Indiana, build them somewhere else. If you think that I’m exaggerating, take a look at some of the rv’s coming out of the factories. They should be ashamed……
Your story has one big hole in it. The RV industry hires and utilizes a sizeable portion of their labor with the Amish. They don’t drive vehicles or equipment. Not the best fit for a logistics company.
I would say yes, there is a possibility Amazon will recruit workers and cause more of worker shortages for RV and boat manufacturers.
However, if I were there I would rather work for a boat manufacturer, or even a RV manufacturer, then Amazon, any day.
Cant ruin whats already ruined.
As a resident of Seattle, I can say that Amazon seems to ruin everything it touches.
RV manufacturing is already in the dumps. Shoddy workmanship at all levels of production. Interior trim and molding falling off, low quality offshore tires, furniture that starts falling apart after a year or two. Even affects so called top of the line units.
The answer is quite easily answered. If American companies would pay “living” wages and provide benefits equivalent to those seen in Western Europe (where, incidentally, workers are more efficient than underpaid American workers), I think the so-called labor shortage would disappear.