----

----

**SECURITIES        AND EXCHANGE COMMISSION**

**WASHINGTON,        D.C. 20549**

**Form        10-Q**

**QUARTERLY        REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF        1934**

**o**
**TRANSITION        REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF        1934**

| **COACHMEN                  INDUSTRIES, INC.**                                           |
|------------------------------------------------------------------------------------------|
| (Exact                  name of registrant as specified in its                  charter) |

| **INDIANA**                                               |   | **35-1101097**                          |
|-----------------------------------------------------------|--------|-----------------------------------------|
| (State                  or other jurisdiction of          |   | (I.R.S.                  Employer       |
| incorporation                  or organization)           |   | Identification                  number) |
|                                                      |   |
| **2831                  Dexter Drive, Elkhart, Indiana**  |   | **46514**                               |
| (Address                  of principal executive offices) |   | (Zip                  Code)             |

| Registrant’s                  telephone number, including area code |   | **574-262-0123** |
|---------------------------------------------------------------------------|--------|------------------|

----

----

**FORM        10-Q**

| **INDEX**                                                                   |
|-----------------------------------------------------------------------------|
|                                                                        | Page                  No. |
| Part                  I. Financial Information                              |   |
|                                                                        |   |
| Financial                  Statements:                                      |   |
|                                                                        |   |
| Consolidated                  Balance Sheets-                               | 3-4 |
| September                  30, 2005 and December 31, 2004                   |   |
|                                                                        |   |
| Consolidated                  Statements of Operations-                     | 5 |
| Three                  and Nine Months Ended September 30, 2005 and 2004    |   |
|                                                                        |   |
| Consolidated                  Statements of Cash Flows-                     | 6 |
| Nine                  Months Ended September 30, 2005 and 2004              |   |
|                                                                        |   |
| Notes                  to Consolidated Financial Statements                 | 7-16 |
|                                                                        |   |
| Management’s                  Discussion and Analysis of Financial    | 17-22 |
| Condition                  and Results of Operations                        |   |
|                                                                        |   |
| Quantitative                  and Qualitative Disclosures About Market Risk | 23 |
|                                                                        |   |
| Controls                  and Procedures                                    | 23 |
|                                                                        |   |
| Part                  II. Other Information                                 |   |
|                                                                        |   |
| Item                  6. Exhibits                                           | 24 |
|                                                                        |   |
| Signatures                                                                  | 25 |
|                                                                        |   |
| Index                  to Exhibits                                          | 26 |
|                                                                        |   |
|                                                                        |   |
|                                                                        |   |
|                                                                        |   |

----

Index

**Coachmen        Industries, Inc. and        Subsidiaries**

**Consolidated        Balance Sheets**

|                                                                   |   | September                  30, |        | December                  31, |   |
|------------------------------------------------------------------------|--------|--------------------------------|-------------|-------------------------------|--------|
|                                                                   |   | 2005                           |        | 2004                          |   |
|                                                                   |   | (Unaudited)                    |        |                          |   |
| **Assets**                                                             |   |                           |        |                          |   |
| Current                  assets:                                       |   |                           |        |                          |   |
| Cash                  and cash equivalents                             |   | $                              | 16,175      |                          | $      | 14,992 |   |
| Marketable                  securities                                 |   |                           | -           |                          |   | 1,747 |   |
| Trade                  receivables, less allowance for                 |   |                           |        |                          |   |   |   |
| doubtful                  receivables 2005 - $1,362                    |   |                           |        |                          |   |   |   |
| and                  2004 - $919                                       |   |                           | 43,366      |                          |   | 58,805 |   |
| Other                  receivables                                     |   |                           | 2,415       |                          |   | 4,209 |   |
| Refundable                  income taxes                               |   |                           | 6,746       |                          |   | 244 |   |
| Inventories                                                            |   |                           | 129,738     |                          |   | 136,088 |   |
| Prepaid                  expenses and other                            |   |                           | 4,343       |                          |   | 4,144 |   |
| Deferred                  income taxes                                 |   |                           | 10,054      |                          |   | 6,014 |   |
|                                                                   |   |                           |        |                          |   |   |   |
| Total                  current assets                                  |   |                           | 212,837     |                          |   | 226,243 |   |
|                                                                   |   |                           |        |                          |   |   |   |
| Property,                  plant and equipment, at cost                |   |                           | 153,657     |                          |   | 163,709 |   |
| Less,                  accumulated depreciation                        |   |                           | (79,862     | )                             |   | (81,358 | ) |
|                                                                   |   |                           |        |                          |   |   |   |
| Property,                  plant and equipment, net                    |   |                           | 73,795      |                          |   | 82,351 |   |
|                                                                   |   |                           |        |                          |   |   |   |
|                                                                   |   |                           |        |                          |   |   |   |
| Goodwill                                                               |   |                           | 18,132      |                          |   | 18,132 |   |
| Cash                  value of life insurance, net of loans of $15,000 |   |                           | 28,293      |                          |   | 25,162 |   |
| Real                  estate held for sale                             |   |                           | -           |                          |   | 60 |   |
| Other                                                                  |   |                           | 5,582       |                          |   | 5,775 |   |
|                                                                   |   |                           |        |                          |   |   |   |
|                                                                   |   |                           |        |                          |   |   |   |
| Total                  assets                                          |   | **$**                          | **338,639** |                          | **$**  | **357,723** |   |
|                                                                   |   |                           |        |                          |   |   |   |

*See        Notes to Consolidated Financial Statements.*

----

Index

**Coachmen        Industries, Inc. and Subsidiaries**

**Consolidated        Balance Sheets **

|                                                                                                            |   | September                  30, |        | December                  31, |   |
|-----------------------------------------------------------------------------------------------------------------|--------|--------------------------------|-------------|-------------------------------|--------|
|                                                                                                            |   | 2005                           |        | 2004                          |   |
|                                                                                                            |   | (Unaudited)                    |        |                          |   |
| **Liabilities**                                                                                                 |   |                      |        |                     |   |
| Current                  liabilities:                                                                           |   |                      |        |                     |   |
| Short-term                  borrowings                                                                          |   | $                              | -           |                          | $      | 20,000 |   |
| Accounts                  payable, trade                                                                        |   |                           | 49,459      |                          |   | 33,805 |   |
| Accrued                  income taxes                                                                           |   |                           | -           |                          |   | 2,479 |   |
| Accrued                  expenses and other liabilities                                                         |   |                           | 49,066      |                          |   | 39,466 |   |
| Floorplan                  notes payable                                                                        |   |                           | 4,176       |                          |   | 6,986 |   |
| Current                  portion of long-term debt                                                              |   |                           | 2,217       |                          |   | 2,195 |   |
|                                                                                                            |   |                           |             |                          |   |  |   |
| Total                  current liabilities                                                                      |   |                           | 104,918     |                          |   | 104,931 |   |
|                                                                                                            |   |                           |             |                          |   |  |   |
| Long-term                  debt                                                                                 |   |                           | 13,883      |                          |   | 14,943 |   |
| Deferred                  income taxes                                                                          |   |                           | 1,157       |                          |   | 3,512 |   |
| Postretirement                  deferred compensation benefits                                                  |   |                           | 10,213      |                          |   | 9,724 |   |
| Other                                                                                                           |   |                           | 38          |                          |   | 195 |   |
|                                                                                                            |   |                           |             |                          |   |  |   |
| Total                  liabilities                                                                              |   |                           | 130,209     |                          |   | 133,305 |   |
|                                                                                                            |   |                           |             |                          |   |  |   |
| **Shareholders’                  equity**                                                                 |   |                           |             |                          |   |  |   |
| Common                  shares, without par value:                                                              |   |                           |             |                          |   |  |   |
| authorized                  60,000 shares; issued 2005 - 21,128 sharesand                  2004 - 21,108 shares |   |                           | 92,102      |                          |   | 91,850 |   |
| Additional                  paid-in capital                                                                     |   |                           | 5,769       |                          |   | 8,894 |   |
| Retained                  earnings                                                                              |   |                           | 169,328     |                          |   | 184,284 |   |
| Treasury                  shares, at cost: 2005 - 5,311 shares                                                  |   |                           |             |                          |   |  |   |
| and                  2004 - 5,384 shares                                                                        |   |                           | (58,558     | )                             |   | (59,002 | ) |
| Unearned                  compensation                                                                          |   |                           | (191        | )                             |   | (1,700 | ) |
| Accumulated                  other comprehensive income (loss)                                                  |   |                           | (20         | )                             |   | 92 |   |
|                                                                                                            |   |                           |             |                          |   |  |   |
| Total                  shareholders’ equity                                                               |   |                           | 208,430     |                          |   | 224,418 |   |
|                                                                                                            |   |                           |             |                          |   |  |   |
| Total                  liabilities and shareholders’ equity                                               |   | **$**                          | **338,639** |                          | **$**  | **357,723** |   |
|                                                                                                            |   |                           |             |                          |   |  |   |

*See        Notes to Consolidated Financial Statements.*

----

Index

**Coachmen        Industries, Inc. and        Subsidiaries**

**Consolidated        Statements of Operations**

|                                                                                                 |   | Three                  Months Ended September 30, |    | Nine                  Months Ended September 30, |   |
|------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------|---------|--------------------------------------------------|--------|
|                                                                                                 |   | 2005                                              |    | 2004                                             |   | 2005 |   | 2004 |   |
|                                                                                                 |   |                                              |    |                                             |   |   |   |   |   |
| Net                  sales                                                                           |   | $                                                 | 198,036 |                                             | $      | 232,310 |   | $ | 612,131 |   | $ | 660,913 |   |
| Cost                  of sales                                                                       |   |                                              | 180,391 |                                             |   | 195,035 |   |   | 549,215 |   |   | 563,683 |   |
| Gross                  profit                                                                        |   |                                              | 17,645  |                                             |   | 37,275 |   |   | 62,916 |   |   | 97,230 |   |
|                                                                                                 |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Operating                  expenses:                                                                 |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Delivery                                                                                             |   |                                              | 10,596  |                                             |   | 11,515 |   |   | 30,972 |   |   | 30,651 |   |
| Selling                                                                                              |   |                                              | 7,431   |                                             |   | 8,367 |   |   | 24,003 |   |   | 23,575 |   |
| General                  and administrative                                                          |   |                                              | 10,423  |                                             |   | 8,853 |   |   | 24,442 |   |   | 27,442 |   |
| Asset                  impairments                                                                   |   |                                              | 6,986   |                                             |   | - |   |   | 6,986 |   |   | - |   |
| Gain                  on sale of properties, net                                                     |   |                                              | (255    | )                                                |   | (189 | ) |   | (304 | ) |   | (1,268 | ) |
| Total                  operating expenses                                                            |   |                                              | 35,181  |                                             |   | 28,546 |   |   | 86,099 |   |   | 80,400 |   |
|                                                                                                 |   |                                              |    |                                             |   |   |   |   |   |   |   |   |   |
| Operating                  income (loss)                                                             |   |                                              | (17,536 | )                                                |   | 8,729 |   |   | (23,183 | ) |   | 16,830 |   |
|                                                                                                 |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Nonoperating                  (income) expenses:                                                     |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Interest                  expense                                                                    |   |                                              | 971     |                                             |   | 551 |   |   | 2,899 |   |   | 1,442 |   |
| Investment                  income                                                                   |   |                                              | (355    | )                                                |   | (533 | ) |   | (1,612 | ) |   | (1,808 | ) |
| Other                  income, net                                                                   |   |                                              | (137    | )                                                |   | (234 | ) |   | (430 | ) |   | (320 | ) |
| Total                  nonoperating (income) expenses                                                |   |                                              | 479     |                                             |   | (216 | ) |   | 857 |   |   | (686 | ) |
|                                                                                                 |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Income                  (loss) from continuing operations before income taxes                        |   |                                              | (18,015 | )                                                |   | 8,945 |   |   | (24,040 | ) |   | 17,516 |   |
| Income                  taxes (credit)                                                               |   |                                              | (8,669  | )                                                |   | 3,060 |   |   | (11,838 | ) |   | 5,969 |   |
| Net                  income (loss) from continuing operations                                        |   |                                              | (9,346  | )                                                |   | 5,885 |   |   | (12,202 | ) |   | 11,547 |   |
|                                                                                                 |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Discontinued                  operations:                                                            |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Income                  from operations of discontinued entity (net of taxes)                        |   |                                              | -       |                                             |   | 55 |   |   | - |   |   | 220 |   |
| Net                  income (loss)                                                                   |   | $                                                 | (9,346  | )                                                | $      | 5,940 |   | $ | (12,202 | ) | $ | 11,767 |   |
|                                                                                                 |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Earnings                  per share - Basic                                                          |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Continuing                  operations                                                               |   | $                                                 | (.60    | )                                                | $      | .38 |   | $ | (.78 | ) | $ | .75 |   |
| Discontinued                  operations                                                             |   |                                              | -       |                                             |   | - |   |   | - |   |   | .01 |   |
| Net                  earnings per share                                                              |   | $                                                 | (.60    | )                                                | $      | .38 |   | $ | (.78 | ) | $ | .76 |   |
|                                                                                                 |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Earnings                  per share - Diluted                                                        |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Continuing                  operations                                                               |   | $                                                 | (.60    | )                                                | $      | .38 |   | $ | (.78 | ) | $ | .75 |   |
| Discontinued                  operations                                                             |   |                                              | -       |                                             |   | - |   |   | - |   |   | .01 |   |
| Net                  earnings per share                                                              |   | $                                                 | (.60    | )                                                | $      | .38 |   | $ | (.78 | ) | $ | .76 |   |
|                                                                                                 |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Number                  of common shares used in computation of earnings per                  share: |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Basic                                                                                                |   |                                              | 15,556  |                                             |   | 15,479 |   |   | 15,545 |   |   | 15,469 |   |
| Diluted                                                                                              |   |                                              | 15,556  |                                             |   | 15,544 |   |   | 15,545 |   |   | 15,545 |   |
|                                                                                                 |   |                                              |         |                                             |   |  |   |   |  |   |   |  |   |
| Cash                  dividends per common share                                                     |   | $                                                 | .06     |                                             | $      | .06 |   | $ | .18 |   | $ | .18 |   |

*See        Notes to Consolidated Financial Statements*

----

Index

**Coachmen        Industries, Inc. and        Subsidiaries**

**Consolidated        Statements of Cash Flows**

|                                                                                                                                   |   | Nine                  Months Ended September 30, |       |
|----------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------|------------|
|                                                                                                                                   |   | 2005                                             |       | 2004 |   |
|                                                                                                                                   |   |                                             |       |   |   |
| Cash                  flows from operating activities:                                                                                 |   |                                             |            |   |   |  |   |
| Net                  income (loss)                                                                                                     |   | $                                                | (12,202    | ) | $ | 11,767 |   |
| Adjustments                  to reconcile net income (loss) to net                                                                     |   |                                             |            |   |   |  |   |
| cash                  provided by (used in) operating activities:                                                                      |   |                                             |            |   |   |  |   |
| Depreciation                                                                                                                           |   |                                             | 6,638      |   |   | 6,973 |   |
| Provision                  for doubtful receivables, net of recoveries                                                                 |   |                                             | 574        |   |   | 89 |   |
| Provision                  for write-down of property to net realizable value                                                          |   |                                             | 6,986      |   |   | - |   |
| Gain                  on sale of properties and other assets                                                                           |   |                                             | (304       | )  |   | (1,268 | )  |
| Increase                  in cash surrender value of life insurance policies                                                           |   |                                             | (923       | ) |   | (504 | ) |
| Net                  realized and unrealized (gains) losses on marketable securities                  and                  derivatives |   |                                             | (325       | ) |   | 147 |   |
| Deferred                  income tax benefit                                                                                           |   |                                             | (6,395     | ) |   | (684 | ) |
| Tax                  benefit from stock options exercised                                                                              |   |                                             | 5          |   |   | 23 |   |
| Other                                                                                                                                  |   |                                             | (876       | ) |   | 1,964 |   |
| Changes                  in certain assets and liabilities:                                                                            |   |                                             |            |   |   |  |   |
| Trade                  receivables                                                                                                     |   |                                             | 16,659     |   |   | (7,036 | ) |
| Inventories                                                                                                                            |   |                                             | 6,350      |   |   | (48,514 | ) |
| Prepaid                  expenses and other                                                                                            |   |                                             | (199       | ) |   | (243 | ) |
| Accounts                  payable, trade                                                                                               |   |                                             | 14,720     |   |   | 19,334 |   |
| Income                  taxes - accrued and refundable                                                                                 |   |                                             | (8,981     | ) |   | 1,417 |   |
| Accrued                  expenses and other liabilities                                                                                |   |                                             | 6,790      |   |   | 5,518 |   |
| Net                  cash provided by (used in) operating activities                                                                   |   |                                             | 28,517     |   |   | (11,017 | ) |
|                                                                                                                                   |   |                                             |            |   |   |  |   |
| Cash                  flows from investing activities:                                                                                 |   |                                             |            |   |   |  |   |
| Proceeds                  from sales of marketable securities                                                                          |   |                                             | 1,933      |   |   | 1,932 |   |
| Proceeds                  from sale of property and other assets                                                                       |   |                                             | 395        |   |   | 2,618 |   |
| Investments                  in marketable securities                                                                                  |   |                                             | (2,181     | ) |   | (2,476 | ) |
| Purchases                  of property and equipment                                                                                   |   |                                             | (5,046     | ) |   | (13,235 | ) |
| Other                                                                                                                                  |   |                                             | 140        |   |   | (1,281 | ) |
| Net                  cash used in investing activities                                                                                 |   |                                             | (4,759     | ) |   | (12,442 | ) |
|                                                                                                                                   |   |                                             |            |   |   |  |   |
| Cash                  flows from financing activities:                                                                                 |   |                                             |            |   |   |  |   |
| Proceeds                  from short-term borrowings                                                                                   |   |                                             | 232        |   |   | 28,500 |   |
| Payments                  of short-term borrowings                                                                                     |   |                                             | (20,232    | ) |   | (8,917 | ) |
| Proceeds                  from long-term debt                                                                                          |   |                                             | 241        |   |   | 8,012 |   |
| Payments                  of long-term debt                                                                                            |   |                                             | (1,279     | ) |   | (572 | ) |
| Issuance                  of common shares under stock incentive plans                                                                 |   |                                             | 283        |   |   | 458 |   |
| Cash                  dividends paid                                                                                                   |   |                                             | (1,887     | ) |   | (2,814 | ) |
| Other                                                                                                                                  |   |                                             | 67         |   |   | - |   |
| Net                  cash provided by (used in) financing activities                                                                   |   |                                             | (22,575    | ) |   | 24,667 |   |
|                                                                                                                                   |   |                                             |            |   |   |  |   |
| Increase                  in cash and cash equivalents                                                                                 |   |                                             | 1,183      |   |   | 1,208 |   |
|                                                                                                                                   |   |                                             |            |   |   |  |   |
| Cash                  and cash equivalents:                                                                                            |   |                                             |            |   |   |  |   |
| Beginning                  of period                                                                                                   |   |                                             | 14,992     |   |   | 6,408 |   |
| End                  of period                                                                                                         |   | **$**                                            | **16,175** |   | **$** | **7,616** |   |

*See        Notes to Consolidated Financial Statements.*

----

Index

**Coachmen        Industries, Inc. and Subsidiaries**

**Notes        to Consolidated Financial Statements**

**1.         BASIS OF PRESENTATION**

**2.         SEGMENT INFORMATION**

|                                   |   | Three                  Months Ended |        | Nine                  Months Ended |   |
|----------------------------------------|--------|-------------------------------------|-------------|------------------------------------|--------|
|                                   |   | September                  30,      |        | September                  30,     |   |
|                                   |   | 2005                                |        | 2004                               |   | 2005 |   | 2004 |   |
|                                   |   |                                |        |                               |   |   |   |   |   |
| Net                  sales             |   |                                |             |                               |   |  |   |   |  |   |   |  |   |
| Recreational                  Vehicles |   | $                                   | 133,545     |                               | $      | 157,634 |   | $ | 436,590 |   | $ | 470,548 |   |
| Housing                  and Building  |   |                                | 64,491      |                               |   | 74,676 |   |   | 175,541 |   |   | 190,365 |   |
|                                   |   |                                |             |                               |   |  |   |   |  |   |   |  |   |
| Total                                  |   | **$**                               | **198,036** |                               | **$**  | **232,310** |   | **$** | **612,131** |   | **$** | **660,913** |   |
|                                   |   |                                |             |                               |   |  |   |   |  |   |   |  |   |
| Gross                  profit          |   |                                |             |                               |   |  |   |   |  |   |   |  |   |
| Recreational                  Vehicles |   | $                                   | 2,215       |                               | $      | 17,397 |   | $ | 22,643 |   | $ | 49,746 |   |
| Housing                  and Building  |   |                                | 15,430      |                               |   | 19,878 |   |   | 40,273 |   |   | 47,282 |   |
| Other                                  |   |                                | -           |                               |   | - |   |   | - |   |   | 202 |   |
|                                   |   |                                |             |                               |   |  |   |   |  |   |   |  |   |
| Total                                  |   | **$**                               | **17,645**  |                               | **$**  | **37,275** |   | **$** | **62,916** |   | **$** | **97,230** |   |
|                                   |   |                                |             |                               |   |  |   |   |  |   |   |  |   |
| Operating                  expenses    |   |                                |             |                               |   |  |   |   |  |   |   |  |   |
| Recreational                  Vehicles |   | $                                   | 17,252      |                               | $      | 13,237 |   | $ | 45,053 |   | $ | 36,767 |   |
| Housing                  and Building  |   |                                | 19,817      |                               |   | 15,360 |   |   | 46,496 |   |   | 42,146 |   |
| Other                                  |   |                                | (1,888      | )                                  |   | (51 | ) |   | (5,450 | ) |   | 1,487 |   |
|                                   |   |                                |             |                               |   |  |   |   |  |   |   |  |   |
| Total                                  |   | **$**                               | **35,181**  |                               | **$**  | **28,546** |   | **$** | **86,099** |   | **$** | **80,400** |   |

----

Index

|                                        |   | Three                  Months                  Ended            | Nine                  Months Ended   |
|---------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------|--------------------------------------|
|                                        |   | September                  30,                                                                               | September                  30,  |
|                                        |   |                                                                                                                   | 2005                                 |   |   | 2004 |   |   | 2005 |   |   | 2004 |   |
|                                        |   |                                                                                                                   |                                      |   |   |  |   |   |  |   |   |  |   |
| Operating                  income (loss)    |   |                                                                                                                   |                                      |   |   |  |   |   |  |   |   |  |   |
| Recreational                  Vehicles      |   | $                                                                                                                      | (15,037                              | ) | $ | 4,160 |   | $ | (22,410 | ) | $ | 12,979 |   |
| Housing                  and Building       |   |                                                                                                                   | (4,387                               | ) |   | 4,518 |   |   | (6,223 | ) |   | 5,136 |   |
| Other                                       |   |                                                                                                                   | 1,888                                |   |   | 51 |   |   | 5,450 |   |   | (1,285 | ) |
|                                        |   |                                                                                                                   |                                      |   |   |  |   |   |  |   |   |  |   |
| Total                                       |   | **$**                                                                                                                  | **(17,536**                          | **)** | **$** | **8,729** |   | **$** | **(23,183** | **)** | **$** | **16,830** |   |
|                                        |   |                                                                                                                   |                                      |   |   |  |   |   |  |   |   |  |   |
| Pre-tax                  income (loss) from |   |                                                                                                                   |                                      |   |   |  |   |   |  |   |   |  |   |
| continuing                  operations      |   |                                                                                                                   |                                      |   |   |  |   |   |  |   |   |  |   |
| Recreational                  Vehicles      |   | $                                                                                                                      | (15,373                              | ) | $ | 4,147 |   | $ | (23,106 | ) | $ | 12,941 |   |
| Housing                  and Building       |   |                                                                                                                   | (4,408                               | ) |   | 4,738 |   |   | (6,386 | ) |   | 5,494 |   |
| Other                                       |   |                                                                                                                   | 1,766                                |   |   | 60 |   |   | 5,452 |   |   | (919 | ) |
|                                        |   |                                                                                                                   |                                      |   |   |  |   |   |  |   |   |  |   |
| Total                                       |   | **$**                                                                                                                  | **(18,015**                          | **)** | **$** | **8,945** |   | **$** | **(24,040** | **)** | **$** | **17,516** |   |

|                                   |   | September                  30, |        | December                  31, |   |
|----------------------------------------|--------|--------------------------------|-------------|-------------------------------|--------|
|                                   |   | 2005                           |        | 2004                          |   |
|                                   |   |                           |        |                          |   |
| Total                  assets          |   |                           |        |                          |   |
| Recreational                  Vehicles |   | $                              | 156,530     |                          | $      | 174,101 |   |
| Housing                  and Building  |   |                           | 97,231      |                          |   | 111,099 |   |
| Other                                  |   |                           | 84,878      |                          |   | 72,523 |   |
|                                   |   |                           |        |                          |   |   |   |
| Total                                  |   | **$**                          | **338,639** |                          | **$**  | **357,723** |   |
|                                   |   |                           |        |                          |   |   |   |

**3.**
**INVENTORIES**

|                             |   | September                  30, |        | December                  31, |   |
|----------------------------------|--------|--------------------------------|-------------|-------------------------------|--------|
|                             |   | 2005                           |        | 2004                          |   |
|                             |   |                           |        |                          |   |
| Raw                  materials   |   | $                              | 37,365      |                          | $      | 39,524 |   |
| Work                  in process |   |                           | 22,334      |                          |   | 21,173 |   |
| Improved                  lots   |   |                           | 359         |                          |   | 2,236 |   |
| Finished                  goods  |   |                           | 69,680      |                          |   | 73,155 |   |
|                             |   |                           |        |                          |   |   |   |
| Total                            |   | **$**                          | **129,738** |                          | **$**  | **136,088** |   |
|                             |   |                           |        |                          |   |   |   |

----

Index

**4.**
**ACCRUED        EXPENSES AND OTHER LIABILITIES**

|                                                                 |   | September                  30, |       | December                  31, |   |
|----------------------------------------------------------------------|--------|--------------------------------|------------|-------------------------------|--------|
|                                                                 |   | 2005                           |       | 2004                          |   |
|                                                                 |   |                           |       |                          |   |
| Wages,                  salaries, bonuses and commissions            |   | $                              | 3,918      |                          | $      | 5,366 |   |
| Dealer                  incentives, including volume                 |   |                           |       |                          |   |   |   |
| bonuses,                  dealer trips, interest                     |   |                           |       |                          |   |   |   |
| reimbursement,                  co-op advertising and                |   |                           |       |                          |   |   |   |
| other                  rebates                                       |   |                           | 3,202      |                          |   | 5,119 |   |
| Warranty                                                             |   |                           | 16,104     |                          |   | 10,140 |   |
| Insurance-products                  and general liability,           |   |                           |       |                          |   |   |   |
| workers’                  compensation, group health and other |   |                           | 6,612      |                          |   | 5,589 |   |
| Customer                  deposits and unearned revenues             |   |                           | 8,775      |                          |   | 7,340 |   |
| Other                  current liabilities                           |   |                           | 10,455     |                          |   | 5,912 |   |
|                                                                 |   |                           |       |                          |   |   |   |
| Total                                                                |   | **$**                          | **49,066** |                          | **$**  | **39,466** |   |
|                                                                 |   |                           |       |                          |   |   |   |

|                                                                                                                       |   | Three                  Months EndedSeptember                  30, |       | Nine                  Months EndedSeptember                  30, |   |
|----------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------|------------|------------------------------------------------------------------|--------|
|                                                                                                                       |   | 2005                                                              |       | 2004                                                             |   | 2005 |   | 2004 |   |
|                                                                                                                       |   |                                                              |            |                                                             |   |  |   |   |  |   |   |  |   |
| Balance                  of accrued warranty at beginning of period                                                        |   | $                                                                 | 10,780     |                                                             | $      | 10,510 |   | $ | 10,140 |   | $ | 8,658 |   |
|                                                                                                                       |   |                                                              |            |                                                             |   |  |   |   |  |   |   |  |   |
| Warranties                  issued during the period and changes in liability for pre-existing                  warranties |   |                                                              | 12,114     |                                                             |   | 5,024 |   |   | 23,657 |   |   | 16,862 |   |
|                                                                                                                       |   |                                                              |            |                                                             |   |  |   |   |  |   |   |  |   |
| Cash                  settlements made during the period                                                                   |   |                                                              | (6,790     | )                                                                |   | (5,114 | ) |   | (17,693 | ) |   | (15,100 | ) |
|                                                                                                                       |   |                                                              |            |                                                             |   |  |   |   |  |   |   |  |   |
| Balance                  of accrued warranty at September 30                                                               |   | **$**                                                             | **16,104** |                                                             | **$**  | **10,420** |   | **$** | **16,104** |   | **$** | **10,420** |   |
|                                                                                                                       |   |                                                              |            |                                                             |   |  |   |   |  |   |   |  |   |

----

Index

**5.**
**EARNINGS        PER SHARE**

|                                                               |
|--------------------------------------------------------------------|
|                                                               |   | Three                  Months EndedSeptember                  30, |   | Nine                  Months EndedSeptember                  30, |   |
|                                                               |   |   | 2005 |   |   | 2004 |   |   | 2005 |   |   | 2004 |   |
|                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Numerator:                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  income (loss) applicable to common stock |   | $  |  (9,346 | )  | $ | 5,940 |   | $  | (12,202 | )  | $  | 11,767 |   |
|                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Denominator:                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Number                  of shares outstanding, end of period:      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common                  stock                                      |   |   | 15,817 |   |   | 15,706 |   |   | 15,817 |   |   | 15,706 |   |
| Effect                  of weighted average contingently           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| issuable                  shares outstanding during period         |   |   | (268 | )  |   | (202 | )  |   | (244 | )  |   | (167 | )  |
| Effect                  of weighted average shares                 |   |   |   |   |   |   |   |   |   |   |   |   |   |
| outstanding                  during period                         |   |   | 7 |   |   | (25 | )  |   | (28 | )  |   | (70 | )  |
| Weighted                  average number of common shares          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| used                  in basic EPS                                 |   |   | 15,556 |   |   | 15,479 |   |   | 15,545 |   |   | 15,469 |   |
| Effect                  of dilutive securities, stock options      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| and                  awards                                        |   |   | - |   |   | 65 |   |   | - |   |   | 76 |   |
| Weighted                  average number of common shares          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| used                  in diluted EPS                               |   |   | 15,556 |   |   | 15,544 |   |   | 15,545 |   |   | 15,545 |   |
|                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

Index

**6.**
**COMPREHENSIVE        INCOME (LOSS)**

|                                                                                   |   | Three                  Months Ended                     |                                       | Nine                  Months Ended |   |
|----------------------------------------------------------------------------------------|--------|---------------------------------------------------------|--------------------------------------------|------------------------------------|--------|
|                                                                                   |   | September                  30,      | September                  30,   |
|                                                                                   |   |                                                    | 2005                                       |                               |   | 2004 |   |   | 2005 |   |   | 2004 |   |
|                                                                                   |   |                                                    |                                            |                               |   |  |   |   |  |   |   |  |   |
| Net                  income (loss)                                                     |   | $                                                       | (9,346                                     | )                                  | $      | 5,940 |   | $ | (12,202 | ) | $ | 11,767 |   |
| Unrealized                  losses on securities held for sale, net of taxes           |   |                                                    | -                                          |                               |   | (58 | ) |   |  |   |   | (204 | ) |
| Reclassification                  adjustment for realized gains included in net income |   |                                                    |                                       |                               |   |   |   |   | (188 | ) |   |   |   |
| Unrealized                  gains (losses) on cash flow hedges, net of taxes           |   |                                                    | 44                                         |                               |   | (44 | ) |   | 76 |   |   | 31 |   |
|                                                                                   |   |                                                    |                                            |                               |   |  |   |   |  |   |   |  |   |
| Comprehensive                  income (loss)                                           |   | $                                                       | (9,302                                     | )                                  | $      | 5,838 |   | **$** | (12,314 | ) | **$** | 11,594 |   |

**7.**
**COMMITMENTS,        CONTINGENCIES AND GUARANTEES**

**Obligation        to Purchase Consigned Inventories**

**Repurchase        Agreements**

----

Index

**Corporate        Guarantees**

**Financing        Obligation**

----

Index

**Litigation**

**8.**
**STOCK-BASED        COMPENSATION**

*Accounting        for Certain Transactions Involving Stock Compensation*

----

Index

*Accounting          for Stock Issued to Employees, *
*Accounting          for Stock-Based Compensation.*

|                                                                                                                                                                                      |   | Three                  Months Ended                       |   | Nine                  Months Ended |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------|--------|------------------------------------|--------|
|                                                                                                                                                                                      |   | September                  30,                            |   | September                  30,     |   |
|                                                                                                                                                                                      |   | 2005                                                      |   | 2004                               |   | 2005 |   | 2004 |   |
|                                                                                                                                                                                      |   | (in                  thousands, except per share amounts) |   |
|                                                                                                                                                                                      |   |                                                      |   |                               |   |   |   |   |   |
| Net                  income (loss), as reported                                                                                                                                           |   | $                                                         | (9,346 | )                             | $      | 5,940 |   | $ | (12,202 | )  | $ | 11,767 |   |
|                                                                                                                                                                                      |   |                                                      |   |                               |   |   |   |   |   |   |   |   |   |
| Add:                  Stock-based compensation expense (credit) under variable plan included                  in                  reporting net income, net of taxes                      |   |                                                      | (353   | )                             |   | 141 |   |   | (865 | ) |   | 429 |   |
|                                                                                                                                                                                      |   |                                                      |   |                               |   |   |   |   |   |   |   |   |   |
| Deduct:                  Total stock-based employee compensation expense (credit) determined                  under                  fair value based method for all awards, net of taxes |   |                                                      | 505    |                               |   | (206 | ) |   | 795 |   |   | (621 | ) |
|                                                                                                                                                                                      |   |                                                      |   |                               |   |   |   |   |   |   |   |   |   |
| Pro                  forma net income (loss)                                                                                                                                              |   | $                                                         | (9,194 | )                             | $      | 5,875 |   | $ | (12,272 | )  | $ | 11,575 |   |
|                                                                                                                                                                                      |   |                                                      |   |                               |   |   |   |   |   |   |   |   |   |
| Net                  earnings per share:                                                                                                                                                  |   |                                                      |   |                               |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                      |   |                                                      |   |                               |   |   |   |   |   |   |   |   |   |
| Basic                  - as reported                                                                                                                                                      |   | $                                                         | (.60   | )                             | $      | .38 |   | $ | (.78 | )  | $ | .76 |   |
| Basic                  - pro forma                                                                                                                                                        |   | $                                                         | (.59   | )                             | $      | .38 |   | $ | (.79 | )  | $ | .75 |   |
|                                                                                                                                                                                      |   |                                                      |   |                               |   |   |   |   |   |   |   |   |   |
| Diluted                  - as reported                                                                                                                                                    |   | $                                                         | (.60   | )                             | $      | .38 |   | $ | (.78 | )  | $ | .76 |   |
| Diluted                  - pro forma                                                                                                                                                      |   | $                                                         | (.59   | )                             | $      | .38 |   | $ | (.79 | )  | $ | .74 |   |

**9.**
**        RESTRUCTURING CHARGES **

----

Index

**Housing          and Building Segment **

**Recreational        Vehicle Segment**

**10.**
**INCOME        TAXES**

----

Index

**11.**
**NEW          ACCOUNTING PRONOUNCEMENTS**

*Share-Based          Payment*
*Accounting          for Stock-Based Compensation*
*Accounting          for Stock Issued to Employees*
*Statement          of Cash Flows*

----

Index

**Coachmen        Industries, Inc. and Subsidiaries**

**Management’s        Discussion and Analysis**

**Of        Financial Condition and Results of Operations**

|                                                                                                      |   | Comparison                  of                          |    |
|-----------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------|---------|
|                                                                                                      |   | Three                  Months                           |    | Nine                  Months |   |
|                                                                                                      |   | Ended                  September 30, 2005 and 2004 |    |
|                                                                                                      |   | Increase                  (Decrease)                    |    |
|                                                                                                      |   | Amount                                                  |    | Percentage |   |   |   | Amount |   | Percentage |   |
|                                                                                                      |   |                                                    |    |   |   |   |   |   |   |   |   |
| Net                  sales                                                                           |   | $                                                       | (34,274 | ) |   | (14.8 | )% |   |   |   | $ | (48,782 | ) |   | (7.4 | )% |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Cost                  of sales                                                                       |   |                                                    | (14,644 | ) |   | (7.5 | ) |   |  |   |   | (14,468 | ) |   | (2.6 | ) |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Delivery expenses                                                                               |   |                                                    | (919    | ) |   | (8.0 | ) |   |  |   |   | 321 |   |   | 1.0 |   |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Selling                  expenses                                                                    |   |                                                    | (936    | ) |   | (11.2 | ) |   |  |   |   | 428 |   |   | 1.8 |   |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| General                  and administrative expenses                                                 |   |                                                    | 1,570   |   |   | 17.7 |   |   |  |   |   | (3,000 | ) |   | (10.9 | ) |
|                                                                                                      |   |                                                    |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Asset                  impairments                                                                        |   |                                                    | 6,986   |   |   | 100 |   |   |   |   |   | 6,986 |   |   | 100 |   |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Gain                  on sale of properties, net                                                     |   |                                                    | 66      |   |   | 34.9 |   |   |  |   |   | (964 | ) |   | (76.0 | ) |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Interest                  expense                                                                    |   |                                                    | 420     |   |   | 76.2 |   |   |  |   |   | 1,457 |   |   | 101.0 |   |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Investment                  income                                                                   |   |                                                    | (178    | ) |   | (33.4 | ) |   |  |   |   | (196 | ) |   | (10.8 | ) |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Other                  income, net                                                                   |   |                                                    | (97     | ) |   | (41.5 | ) |   |  |   |   | 110 |   |   | 34.4 |   |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Income                  (loss) from continuing operations before income                  taxes  |   |                                                    | (26,960 | ) |   | (301.4 | ) |   |  |   |   | (41,556 | ) |   | (237.2 | ) |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Income                  taxes (credit)                                                               |   |                                                    | (11,729 | ) |   | (383.3 | ) |   |  |   |   | (17,807 | ) |   | (298.3 | ) |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Net                  income (loss) from continuing operations                                        |   |                                                    | (15,231 | ) |   | (258.8 | ) |   |  |   |   | (23,749 | ) |   | (205.7 | ) |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Income                  from operations of discontinued entity, net of                  taxes   |   |                                                    | (55     | ) |   | (100.0 | ) |   |  |   |   | (219 | ) |   | (100.0 | ) |
|                                                                                                      |   |                                                    |         |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Net                  income (loss)                                                                   |   |                                                    | (15,286 | ) |   | (257.3 | ) |   |  |   |   | (23,968 | ) |   | (203.7 | ) |

----

Index

**NET        SALES**

**COST        OF SALES**

----

Index

**OPERATING        EXPENSES**

**ASSET        IMPAIRMENTS**

**GAIN        ON THE SALE OF PROPERTIES, NET**

----

Index

**INTEREST        EXPENSE**

**INVESTMENT        INCOME**

**OTHER        INCOME, NET**

**INCOME        TAXES**

**LIQUIDITY,        CAPITAL RESOURCES AND FINANCIAL CONDITION**

----

Index

**CRITICAL        ACCOUNTING POLICIES**

**FORWARD-LOOKING        STATEMENTS**

----

Index

----

Index

**ITEM        3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET        RISK**

**ITEM        4. CONTROLS AND PROCEDURES**

----

Index

**PART        II. OTHER INFORMATION**

Item        6. Exhibits

----

Index

**SIGNATURES**

**COACHMEN        INDUSTRIES, INC.**

| Date:                  November 2, 2005                  | By:    | /s/                  Claire C. Skinner                 |
|----------------------------------------------------------|--------|--------------------------------------------------------|
|                                                     |   | Claire                  C. Skinner, Chairman of the    |
|                                                     |   | Board                  and Chief Executive Officer     |
|                                                     |   |                                                   |
|                                                     |   |                                                   |
|                                                     |   |                                                   |
|                                                     |   |                                                   |
| Date:                  November 2, 2005                  | By:    | /s/                  Joseph P. Tomczak                 |
|                                                     |   | Joseph                  P. Tomczak, Executive Vice     |
|                                                     |   | President                  and Chief Financial Officer |
|                                                     |   |                                                   |
|                                                     |   |                                                   |
|                                                     |   |                                                   |
|                                                     |   |                                                   |
| Date:                  November 2,                  2005 | By:    | /s/                  Colleen A. Zuhl                   |
|                                                     |   | Colleen                  A. Zuhl, Vice President       |
|                                                     |   | and                  Controller                        |

----

Index

**INDEX        TO EXHIBITS**

----

----