WATERLOO -- It might seem that the math wouldn't work.

But, the accountants at Winnebago Industries Inc. say it does: $4 a gallon equals a $12.7 million loss for the Forest City-based motor-home manufacturer, which said Oct. 16 that it had lost $12.7 million for the fourth quarter, which ended Aug. 30. That's compared with profit of $14.8 million in the same quarter last year.

The losses have touched Cedar Valley dealers, although some say they are still selling some types of recreational vehicles.

At Winnebago, sales plummeted 64 percent to $85.3 million, from $237.7 million a year earlier.

The company also reported a $4.7 million impairment charge for the recent quarter from idling its Charles City plant and severance costs of about $750,000 due to job cuts at all of its facilities.

Deliveries of motor homes fell 64 percent to 928 units from 2,588 in the year-ago period, the company said.

Some other numbers:

? Industry shipments were down 54 percent in June, 56 percent in July and 65 percent in August.

? Statistical Surveys Inc., the retail reporting service for the RV industry, reported Class A, B and C motor home retail sales industrywide were down 37 percent in 2008 and 50 percent in Winnebago's fourth fiscal quarter.

? Winnebago dealers' inventory decreased nearly 700 units in the fourth quarter, or about 16 percent.

? During the fourth quarter, Winnebago cut its work force companywide by about 600 full-time hourly and salaried employees. With an additional cut of 300 workers since the fourth quarter, the company had about 1,930 employees, a 42-percent decrease since Aug. 25, 2007.

"It is extremely difficult to lose valued employees, but it is also imperative to reduce our overhead costs to more closely align to the current motor home market," Winnebago president Bob Olson said, adding that the company is looking at other cost-cutting measures.

Cedar Valley dealers say they have felt Winnebago's pain.

"It's a little bit frustrating to see that, but the RV industry as a whole has been through ups and downs, and Winnebago has been one of the better ones about making it through and rising to the top again," said Brad Miller, business manager at Fogdall RV in Cedar Falls. "Especially being a Winnebago dealer, it's frustrating. But, we expect it to come around."

Local RV dealer A1 Vacationland has had more than sky-high fuel prices and Wall Street's financial wobbles to face. The Cedar Falls dealer lost most of its stock to the wave of tornados that rampaged through the area May 25.

"For us, we were hurt pretty significantly, but the tornado wiped us out," said Greg Heath, A1 Vacationland's director of finance and insurance. "We lost almost our entire inventory."

The dealership has managed to stay afloat, as it still waits for insurance adjustors to issue their final assessments, Heath said. But, he added, it's been a "down year" for RV dealers, anyway.

He said the market was probably 40 percent down since the summer floods. And, he said, high fuel prices were only part of the slump.

"It's an election year, and election years always are a down trend," he said. "But I think everybody's afraid of the economy. I heard one of the FEMA reps say, between the tornado and floods, from Mason City to Iowa City, 6,000 homes were destroyed. People had to get their lives back together, and that doesn't leave a lot of time for camping or boating."

Heath said his dealership is still likely "two to three months" from running normally.

In the meantime?

"The problem we've got is we're selling units as they come in, but it's a struggle," he said. "The insurance company took months to even do anything. Every day, we're in contact with them, and they're still dragging their feet. You do what you can do."

Heath added a note of optimism.

"One of the things I see, though, in the RV industry, is that Warren Buffett (through his Berkshire Hathaway investment firm) bought Forest River RV, one of the big boys. They build very nice campers, and my guess is that Warren Buffett is one of the most intelligent financial wizards around. That tells me he thinks the RV business is going to come back very strong, or he wouldn't have done it. I'm very optimistic for next year."

Miller said his dealership had tried to be as proactive as possible in meeting the crisis.

"After last year, we had a dip from the year before in gas prices in the economy and war and everything else going on, so we prepared ourselves for this year," he said. "So, we're on track."

Making things happen is a key, he added.

"We've been aggressive and getting our name our there and catering our inventory to what's been selling," he said. "Gas prices being higher, some people decided to get something a little more fuel-efficient. We were fairly proactive in that and that helped set us up for the year."

Towable RVs have been selling, Miller noted.

"Obviously, with gas prices and Winnebago stock falling, people were not buying as much motorizied," he said. "They're leaning more toward towable."

Used motor homes also are getting some attention, he added.

"We've been selling more used motorized motor homes," he said. "But the majority (of sales) have been towable vehicles."

Jeff Engelbart, vice president of Lasso E RV Inc. in Anamosa, described the RV market as "up and down, but he said his company's sales have been acceptable.

"It was pretty decent a few weeks ago, and it slowed down, but some of that is seasonal," he said. "Kids back to school, the weather starts changing and campgrounds close, and you expect a slowdown at that point."

Lasso E RV has sold some motorized vehicles, Engelbart said.

"We've actually been moving some motorized stuff; we've been moving a little of everything across the board," he said.

Perceptions sometimes steer some unpleasant realities in business, and that has been the case with RV sales, Engelbart said.

"The biggest problem, and I'm not picking on media, is when you start driving fear, the more you talk about it, the worse things get," he said. "Fear drives it more than anything."

Promotions can help, he added.

"One of our companies run what they call a stimulus program for a couple of months, and I think that promoted some sales," he said. "I know they turned some pretty good numbers nationwide. Anytime you can get a better deal, they take a hard look at things, and if they're on the fence, it gets them off the fence."

As for Winnebago, the Forest City's reliance on motorized vehicles likely is a kind of weight, Engelbart said.

"I'm sure it has affected them more so, since they're strictly motorizied," he said. "Gas priceds going up did affect the motroized industry. It's going to affect them more than a manufacturer that's diversified, building trailers, fifth wheels and such. That motorized market is the first thing that noticed a downturn in sales."

But, he said, Winnebago likely will see things improve.

"I think if the fuel prices go down and stabilize and people quit talking about it and it quits being so erratic in price movement, it will improvent," he said. "They've been through this before."

Contact Jim Offner at (319) 291-1598 or jim.offner@wcfcourier.com.