SIC 2451 Mobile Homes
SIC 2451
This category covers establishments primarily engaged in manufacturing mobile homes and nonresidential mobile buildings. These units are generally more than 35 feet long, at least 8 feet wide, and often are equipped with wheels. Trailers that are generally 35 feet long or less, 8 feet wide or less, and with self-contained facilities are classified in SIC 3792: Travel Trailers and Campers. Portable wood buildings not equipped with wheels are classified in SIC 2452: Prefabricated Wood Buildings and Components.
321991
Manufactured Home (Mobile Home) Manufacturing
After a decade of unprecedented growth in the 1990s, manufactured home builders entered the new millennium with a thud, struggling through their worst time since emerging from the recreational vehicle industry in the 1960s. A reprieve in 2005 was short-lived, and the following year sales plummeted to 1961 levels. Conditions are not expected to rebound for several years, after the market has absorbed the surplus of mobile homes and trailers—many unused—that served as temporary housing for Hurricane Katrina victims.
As a general rule, whenever the traditional housing market thrives, the manufactured housing market suffers, and vice versa. By the late 2000s, as interest rates and housing prices climbed in tandem, house-hunters were increasingly attracted to mobile homes. The U.S. Census Bureau reported that in 2006, new mobile homes were sold for an average of $64,000, compared to a median of $235,000 for a new house.
During the mobile home industry's beginning, its products answered the need of a small percentage of the American populace: temporary shelter primarily used by migrant farm workers and equally nomadic construction workers. Although these were not the only buyers of mobile homes, they did account for the bulk of the industry's sales and, consequently, limited the potential of the industry's future expansion. Because both of these market niches composed a negligible portion of the nation's consumer base and any significant increase in their size—at least in proportion to the rate of population growth—appeared unlikely, the mobile home industry seemed destined to remain a relatively small industry.
This restrictive quality inherent in the industry's market would not inhibit mobile home manufacturers for long, however. Once a product was made and marketed that could attract a more diverse clientele and fulfill a need overlooked by the traditional construction industry, sales would increase. But during the 1920s, when mobile homes were first emerging, and into the 1930s, as the industry began to take shape, sales figures remained unsubstantial.
The onset of World War II provided an unexpected boost for mobile home manufacturers, infusing the industry with production orders for military personnel shelters (essentially miniature barracks on wheels) and mobile housing for defense workers. By the conclusion of the war, mobile home manufacturers had several years of comparatively prodigious production levels, primarily due to defense contracts. As a consequence of this war-related work, mobile homes had become familiar fixtures in many encampments across the country. Moreover, once the war ended, America had, in effect, a standing army: a new social class of military personnel subject to the sometimes itinerant demands of military life. Mobile homes afforded members of the armed forces—especially those with families—the housing flexibility that their frequent relocation orders required, supplying mobile home manufacturers with a new market niche for their products. Two years after the war, in 1947, the mobile home retail market neared $150 million in sales, garnered from the sale of 60,000 units.
The following year sales eclipsed $200 million and unit sales leapt to 85,000 as the mobile home industry began to show signs of dramatic growth. In 1949, however, optimism regarding the industry's growth potential faded. Retail sales for the year were a disappointing $122 million and unit sales plunged to 46,200.
As the industry entered the 1950s, it affected a recovery from the dismal showings of 1949, posting successive gains in annual sales until 1956, a year that would mark the beginning of a new era in the mobile home industry. Originally, the size of mobile homes varied in length, but always measured 8 feet in width to conform to the maximum width permissible by law for vehicles on highways. These homes, after all, were intended to be mobile. But in 1956, manufacturers first introduced 10-foot-wide models, or "10 wides," which quickly became the industry standard. By 1958, 10 wides accounted for 65 percent of the industry's shipments and two years later, represented more than 85 percent.
It rapidly became apparent to manufacturers that mobility was not the primary asset mobile homes offered consumers. Instead, consumers were attracted by their affordability. To be sure, mobility was still an important feature, but mobile home owners moved their units on average only once every two and a half years, becoming for many a semi-permanent dwelling, and for some a house on wheels that never moved. Further, mobile homes came from the factory equipped with all the basic domestic appurtenances homeowners or renters of conventional houses ordinarily would have to buy separately, a total package for the mobile home customer that came with a significantly lower price tag than a bare conventional home.
The size of the mobile home industry had reached respectable proportions by relying solely on the production of 8-foot-wide models, reaching $462 million in sales from the sale of 111,900 units in 1955, the last year in which 8-foot-wide models represented 100 percent of the mobile home market. Although 10 wides quickly dominated the market, their introduction did not initially spark an exponential increase in unit production or in the industry's overall revenues. They did, however, provide the industry with a more stable and potentially rewarding foundation on which to build. Newly married couples and those over 50 years of age became two of the industry's largest market segments, attracted by the affordability and flexibility mobile home housing offered at a time when both these components of the American populace were growing faster than the rate of population growth as a whole.
Along with these developments came the ills suffered by any industry whose target market has transformed into a more lucrative audience. For the mobile home industry these growing pains came in the form of increased competition during the late 1950s, as the low initial investment required to establish a mobile home manufacturing facility enabled hopeful entrepreneurs to enter the industry, causing the market to become saturated. This influx of small, single-plant manufacturers created considerable turmoil in the mobile home market in 1960 and 1961, when a number of small manufacturers failed and their inventories entered the market at panic prices. Units shipments for the industry fell from 120,500 in 1959 to 90,200 in 1961, and industry revenues dropped by roughly $100 million to $505 million.
The subsequent anxiety led to a period of industry consolidation during the early 1960s, as a handful of...
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