End of the road for Jurgens caravans

After spluttering along for several years on the brink of extinction, time seems to have finally run out for the Australian manufacturing arm of South Africa's Jurgens, with Ernst & Young now wrapping up the affairs of Jurgens Caravans Australia, which formally went into liquidation on December 15.

This followed an application for the winding up of Jurgens commenced in April last year by Incepio Ventures Pty Ltd that was formally launched in the Supreme Court by the Commissioner of State Revenue on November 15.

Jurgens is one of a number of high profile overseas caravan brands to have stumbled and fallen on the Australian market in recent years.

Others including Briton's Bailey, Germany’s Knaus and Canada’s Alto appear to have succumbed to the unshakable belief of local buyers in homegrown, heavier products, even before the weight of COVID-19 restrictions took hold.

Only China seems to have broken this bubble by either imitating, purchasing the manufacturing IP, or undercutting the price of local products, although with increasing shipping costs during COVID, the latter’s advantage has decreased, while the demand for good used caravans has not been kind to early Chinese-built products.

Quality product

A betting person a few years ago might have tipped Jurgens to have been the exception.

Its products were generally good, locally built from largely imported flatpack components by a loyal, stable local Pakenham, Victoria workforce; they were also lighter than most Australian mainstream caravans and innovative, but not enough to be weird and they were competitively priced.

Yet after exhibiting at the 2019 Victorian Caravan, Camping & Touring Supershow and shortly afterwards inviting prospective buyers to tour its factory to ‘see how a Jurgens caravan is built before you buy’, employees were met with locked gates and security guards at its Sharnet Circuit, Pakenham factory weeks later when they turned up for work.

This followed the admission by its South African parent company owner Paul Kyriacou that there had been “significant speculation about the future of Jurgens Australia” following its South African HQ being placed into provisional liquidation.

This liquidation followed a dispute with major Jurgens South Africa supplier Megafreight Services (Pty) Ltd with the Pretoria High Court placing Jurgens Ci Pty Ltd in provisional liquidation and called on all interested parties “to show cause why Jurgens should not be placed in final liquidation”.

Both Jurgens CI (PTY) Ltd and Jurgens Camperworld (PTY) Ltd are also subject to provisional liquidation in South Africa, with Jurgens Australia Pty Ltd and the South African Jurgens companies believed to have common directors.

Dramatic fall from grace

It was a big fall from grace.

Jurgens Ci (Pty) Ltd was once one of the largest caravan manufacturers in the southern hemisphere and had built more than 100,000 caravans since 1952. Jurgens Australia Pty Ltd was registered in August 2007. Initially it was based in the Victoria town of Tooradin before moving to Pakenham around nine years ago.

While Jurgen’s local gates later reopened after around 50 employees - some of whom had been with the company for more than 10 years - found a lease termination notice when they returned to work in late March 2019., its once-thriving Pakenham manufacturing operation remained in limbo.

According to a statement then issued by Jurgens Australia director Paul Kyriacou, “We experienced a lock out by the landlord over a commercial dispute. We are pleased to advise we have resolved this issue; the gates are open and we have resumed operations”.

From a peak of around 44 caravans a month, it's believed Jurgens Australia produced just 12 caravans in 2019 before the temporary closure, with losses in terms of unpaid rent mounting at the rate of as much as $35,000 per month, adding to the company’s financial woes.

Although the writing was clearly on the wall, Jurgens Australia put on a brave face, reportedly still taking deposits for new caravans.

One employee at the time reportedly said the company owed half a million dollars in back-rent on the Pakenham premises, however it was major suspension and chassis component supplier AL-KO that also took action to recoup money owed for components.

Liquidation of assets

Ernst & Young’s appointment as liquidator has been more driven by a desire to secure former workers’ entitlements than to replenish the Jurgens kitty through the sale of company assets, although a quantity of stock, a motor vehicle and a number of registered trademarks are owned by Jurgens Australia Pty Ltd.

According to a statement from Ernst & Young: "There is no good news in this for current Jurgens owners. No arrangements have been made with owners.

"Jurgens Australia Pty Ltd only assembled and distributed Jurgens caravans in Australia, with retail warranties dealt with by Jurgens Dealer Group Pty Ltd, a company that is not subject to liquidation and as far as we are aware, continues to operate in Australia."

So, is it the end of the road for Jurgens in Australia?

Ernst & Young says it's aware of a number of parties who are interested in purchasing the assets of Jurgens Australia Pty Ltd and continuing to operate in some capacity in Australia.

Discussions in this regard are ongoing.

Meanwhile, a near-new 2018 Jurgens Solaris -- one of a limited number built in Australia before the manufacturer was forced to vacate the factory early last year -- is currently for sale at South Australia's Dave Benson Caravans.

The glossy grey and white 19ft 6in touring van is advertised at $69,990 drive-way -- about the same price it sold new when launched four years ago.