FORM 10-Q
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
(Mark One)
{X} QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE
    ACT OF 1934.

For the quarterly period ended September 30, 2000

{   }  TRANSITION  REPORT  PURSUANT  TO  SECTION  13 OF 15(d) OF THE  SECURITIES
    EXCHANGE ACT OF 1934.
For the transition period from ........ to .........

Commission file number: 0-22268

                          NATIONAL R.V. HOLDINGS, INC.
             (Exact name of registrant as specified in its charter)

                 Delaware                                   33-0371079
    (State or other jurisdiction of                     (I.R.S. Employer
      incorporation or organization)                    Identification No.)

                               3411 N. Perris Blvd.
                             Perris, California 92571
                                  (909) 943-6007
          (Address,  including zip code,  and telephone  number,  including area
             code, of Registrant's principal executive offices)

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

YES X    NO__

         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common stock, as of the latest practicable date.

Class                                          Outstanding at July 20, 2000
-----                                          ----------------------------
Common stock, par value                              9,662,636
$.01 per share


<PAGE>


                          NATIONAL R.V. HOLDINGS, INC.

                                      INDEX

                                                                           PAGE
                             PART 1 - FINANCIAL INFORMATION

Item 1.    Consolidated Balance Sheet -
           September 30, 2000 and December 31, 1999                          3

           Consolidated Statement of Income -
           Three and Nine Months Ended September 30, 2000 and 1999           4

           Consolidated Statement of Cash Flows -
           Nine Months Ended September 30, 2000 and 1999                     5

           Consolidated Statement of Changes in Stockholders' Equity         6

           Notes to Consolidated Financial Statements                        7

Item 2.    Management's Discussion and Analysis of
           Financial Condition and Results of Operations                   8-10

Item 3.    Quantitative and Qualitative Disclosures about Market Risk       11

                               PART II - OTHER INFORMATION

Item 6.    Exhibits and Reports on Form 8-K                                 12

           Signature                                                        13

           Exhibit 99.1  Factors that May Affect Future Operating Results 14-17







                                       2
<PAGE>

<TABLE>
<CAPTION>
                          NATIONAL R.V. HOLDINGS, INC.
                           CONSOLIDATED BALANCE SHEET
                          (In thousands except shares)
<S>                                           <C>                 <C>
                                              September 30,       December 31,
                                                   2000               1999
                                                (Unaudited)
                                               ------------       ------------
                                ASSETS
Current Assets:
     Cash and cash equivalents                   $   10,456         $   20,301
     Trade receivables, less allowance for
         doubtful accounts of $199                   21,054             22,473
     Inventories                                     64,704             68,187
     Deferred income taxes                            6,489              5,610
     Prepaid expenses                                 2,011              1,439
                                                 ----------          ---------
         Total current assets                       104,714            118,010
Goodwill                                              6,642              6,952
Property, plant and equipment, net                   42,480             33,167
Other                                                 1,276              1,085
                                                 ----------          ---------
                                                  $ 155,112          $ 159,214
                                                 ==========          =========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current
portion of long-term debt                         $      20          $      20
     Accounts payable                                10,316             11,167
     Accrued expenses                                16,346             14,908
                                                  ---------          ---------
         Total current liabilities                   26,682             26,095
Deferred income taxes                                 2,603              2,470
Long-term debt                                           69                 84

Commitments and contingencies

Stockholders' equity:
Preferred stock - $.01 par value; 5,000 shares
     authorized, 4,000 issued and outstanding             -                  -
Common stock - $.01 par value; 25,000,000 shares
     authorized, 10,595,536 and 10,588,886
     issued, respectively                               106                106
Additional paid-in capital                           47,800             47,768
Retained earnings                                    93,113             82,691
Less cost of treasury stock - 932,900 shares       ( 15,261)                 -
                                                  ---------           --------
     Total stockholders' equity                     125,758            130,565
                                                  ---------           --------
                                                  $ 155,112          $ 159,214
                                                  =========          =========
</TABLE>

                 See Notes to Consolidated Financial Statements
                                       3
<PAGE>

<TABLE>
<CAPTION>

                          NATIONAL R.V. HOLDINGS, INC.
                        CONSOLIDATED STATEMENT OF INCOME
                      (In thousands except per share data)
                                   (Unaudited)

<S>                                    <C>            <C>                   <C>            <C>
                                         Three Months Ended                     Nine Months Ended
                                             September 30,                         September 30,
                                          2000           1999                  2000           1999
                                       ---------       ---------            ---------       ---------
Net sales                              $  86,652       $ 108,947            $ 266,431       $ 317,267
Cost of goods sold                        76,460          89,333              232,709         263,520
                                       ---------       ---------            ---------       ---------
         Gross profit                     10,192          19,614               33,722          53,747

Selling expenses                           3,669           3,079               10,176           8,403
General and administrative expenses        2,044           1,648                6,920           5,382
Amortization of intangibles                  103             103                  310             310
                                       ---------       ---------            ---------       ---------
         Operating income                  4,376          14,784               16,316          39,652
Other expense (income):
     Interest expense                          1              -                     3              28
     Interest income                   (     156)     (      381)           (     637)     (      974)
     Other                                     7              11                   28      (      373)
                                       ---------       ---------            ---------       ---------
         Income before income taxes        4,524          15,154               16,922          40,971
Provision for income taxes                 1,791           6,134                6,500          16,369
                                       ---------       ---------            ---------       ---------
         Net income                    $   2,733       $   9,020             $ 10,422       $  24,602

Earnings per common share:
     Basic                                 $0.29          $0.86                 $1.07           $2.37
     Diluted                               $0.28          $0.82                 $1.03           $2.20

Weighted average number of shares:
     Basic                                 9,585          10,448                9,770          10,392
     Diluted                               9,847          11,054               10,146          11,185
</TABLE>









                 See Notes to Consolidated Financial Statements
                                       4
<PAGE>

<TABLE>
<CAPTION>
                          NATIONAL R.V. HOLDINGS, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                 (In thousands)
                                   (Unaudited)

<S>                                                         <C>                  <C>
                                                                    Nine Months Ended
                                                                      September 30,
                                                            ----------------------------------
                                                               2000                  1999
                                                            ----------           -----------
Cash flows from operating activities:
Net income                                                  $   10,422           $    24,602
     Adjustments to reconcile net income to net cash
         provided by operating activities:
           Depreciation expense                                  2,341                 1,781
           Amortization of intangibles                             310                   310
           Loss (gain) on asset disposal                            28              (    387)
           Tax benefit related to exercise of stock options          -                   900
           Decrease (increase) in trade receivables              1,419              (  1,485)
           Decrease (increase) in inventories                    3,483              ( 11,877)
           Increase in prepaid expenses                       (    572)             (  2,391)
           (Decrease) increase in accounts payable            (    851)               10,625
           Increase in accrued expenses                          1,438                 4,811
           Increase in deferred income taxes                  (    746)             (    730)
                                                            ----------           -----------
         Net cash provided by operating activities              17,272                26,159

Cash flows from investing activities:
     Increase in other assets                                 (    191)             (     68)
     Purchases of property, plant and equipment               ( 11,682)             (  7,094)
     Return of investment in Dune Jet Services, LP                   -                 2,912
                                                            ----------           -----------
         Net cash used in investing activities                ( 11,873)             (  4,250)

Cash flows from financing activities:
     Principal payments on long-term debt                     (     15)             (  1,756)
     Proceeds from issuance of common stock                         32                   857
     Purchase of treasury stock                               ( 15,261)                    -
                                                            ----------           -----------
         Net cash used in financing activities                ( 15,244)             (    899)
 Net (decrease) increase in cash                              (  9,845)               21,010
 Cash and cash equivalents - beginning of period                20,301                10,446
                                                            ----------           -----------
 Cash and cash equivalents - end of period                   $  10,456            $   31,456
                                                            ==========           ===========
</TABLE>


                 See Notes to Consolidated Financial Statements
                                       5
<PAGE>


<TABLE>
<CAPTION>
                          NATIONAL R.V. HOLDINGS, INC.
            CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                          (In thousands except shares)
                                   (Unaudited)

<S>                   <C>       <C>        <C>      <C>         <C>        <C>      <C>           <C>
                      Preferred     Common Stock       Paid-in   Retained    Treasury Stock
                        Stock     Shares    Amount     Capital   Earnings   Shares     Amount         Total
                      -------  -----------  ------  ----------  ---------  --------  ---------    ----------
Balance, December 31,
     1999             $     -   10,588,886  $  106  $  47,768  $  82,691          -  $       -    $  130,565
Common Stock issued
     under option plan               6,650       -         32                                             32
Purchase of
     Treasury Stock                                                         932,900  (  15,261)    (  15,261)
Net income                                                         10,422                             10,422
                      -------  -----------  ------  ----------  ---------  --------  ---------    ----------
Balance, September 30,
     2000             $     -   10,595,536  $  106  $  47,800   $  93,113   932,900  $( 15,261)   $  125,758
                      =======  ===========  ======  ==========  =========  ========  =========    ==========
</TABLE>





























                 See Notes to Consolidated Financial Statements
                                       6

<PAGE>

NATIONAL R.V. HOLDINGS, INC.
PART I, ITEM 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Unaudited)

NOTE 1 - GENERAL

     In the opinion of National  R.V.  Holdings,  Inc.  (collectively,  with its
subsidiaries  National R.V., Inc., and Country Coach, Inc. referred to herein as
the "Company"),  the accompanying  unaudited  consolidated  financial statements
contain  all  adjustments,  consisting  only of  normal  recurring  adjustments,
necessary  for the fair  presentation  of the  financial  position,  results  of
operations  and cash flows for all  periods  presented.  Results for the interim
periods are not necessarily indicative of the results for an entire year and the
financial  statements  do  not  include  all of the  information  and  footnotes
required by generally accepted accounting principles. These financial statements
should be read in  conjunction  with the financial  statements and notes thereto
contained in the Company's latest annual report on Form 10-K.



NOTE 2 - INVENTORIES

     Inventories consist of the following:

                                       September 30,         December 31,
                                          2000                  1999
                                       (Unaudited)
                                       -------------        --------------
Finished goods                         $ 19,353,000          $ 12,315,000
Work-in-process                          20,375,000            18,274,000
Raw materials                            14,449,000            14,027,000
Chassis                                  10,527,000            23,571,000
                                       ------------          ------------
                                       $ 64,704,000          $ 68,187,000
                                       ============          ============











                                       7
<PAGE>
NATIONAL R.V. HOLDINGS, INC.
PART 1, ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                 RESULTS OF OPERATIONS

Disclosure Regarding Forward Looking Statements
-----------------------------------------------
         Statements contained in this Quarterly Report on Form 10-Q that are not
historical  facts are  forward-looking  statements  within  the  meaning  of the
Private Securities  Litigation Reform Act of 1995.  Investors are cautioned that
forward-looking  statements are inherently  uncertain.  Actual  performance  and
results may differ  materially  from that  projected or suggested  herein due to
certain risks and  uncertainties  including,  without  limitation,  the cyclical
nature  of  the  recreational   vehicle  industry;   seasonality  and  potential
fluctuations in the Company's  operating  results;  the Company's  dependence on
chassis   suppliers;   potential   liabilities   under  repurchase   agreements;
competition;  government  regulation;  warranty  claims and  product  liability;
dependence on certain dealers and  concentration  of dealers in certain regions;
and the integration by the Company of acquired  businesses and the management of
growth.  Certain  risks and  uncertainties  that could cause  actual  results to
differ  materially  from  that  projected  or  suggested  are set  forth  below.
Additional information concerning risks and uncertainties may be identified from
time  to  time  in the  Company's  filings  with  the  Securities  and  Exchange
Commission  (SEC) and the Company's  public  announcements,  copies of which are
available from the SEC or from the Company upon request.


Liquidity and Capital Resources
-------------------------------
         At September 30, 2000, the Company had working capital of $78.0 million
compared to $91.9 million at December 31, 1999.

         Net cash  provided by operating  activities  was $17.3  million for the
nine months  ended  September  30, 2000  compared to $26.2  million for the same
period in 1999. The change was primarily due to a $14.2 million  decrease in net
income.

         Cash used in investing activities was $11.9 million for the nine months
ended September 30, 2000 compared to $4.3 million for the comparable period last
year.  The change was due to a $4.6  million  increase  in capital  expenditures
primarily  related to the new towables plant under  construction  at the Perris,
California  facility in the current year, and to a $2.9 million  distribution in
respect of the liquidation of the Company's limited partnership interest in Dune
Jet Services, L.P. received by the Company in March 1999.

         Cash used in financing activities was $15.2 million for the nine months
ended September 30, 2000 compared to $0.9 million for the comparable period last
year.  The difference was primarily the result of the $15.3 million spent by the
Company in its stock repurchase  program for the repurchase of 932,900 shares in
the first quarter of 2000.

         The Company  believes  that the  combination  of  internally  generated
funds,  existing  capital and funds available from its existing credit facility,
will be  sufficient  to meet  the  Company's  planned  capital  and  operational
requirements for at least the next 24 months.

                                       8
<PAGE>
NATIONAL R.V. HOLDINGS, INC.
PART 1, ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                 RESULTS OF OPERATIONS (Continued)

Results of Operations
---------------------
         Net sales of $86.7  million for the quarter  ended  September  30, 2000
represent a decrease of $22.3  million or 20.5% from the same quarter last year.
For the nine  months  ended  September  30,  2000,  net sales of $266.4  million
represent a decrease of $50.8 million, or 16.0% compared to the same period last
year.

         Wholesale  shipments of the Company's gas motorhome  products were down
39% from 630 units  for the third  quarter  last  year to 382 units  this  year.
Shipments of the Company's  motorhomes  built on diesel chassis declined just 3%
to 356 units for the third  quarter  compared  to 367 last  year--reflecting  an
industry-wide trend favoring the higher-priced diesel units. Accordingly,  while
total motorhome unit sales declined 26%, revenues from such sales were down 21%.
Class  "A"  motorhome  sales  continue  to  represent  approximately  95% of the
Company's revenue.

         Unit sales of the Company's towable products increased 68% to 129 units
from 77 units for the third quarter last year. The increase is the result of the
introduction of the Company's first  entry-level  towable products as well as an
increase in shipments  of  fifth-wheel  products.  Revenues  from towable  sales
increased 33% for the third quarter over the same quarter last year.

         For the nine months ended September 30, 2000, the Company shipped 1,021
coaches on diesel chassis, 22 fewer than last year. The unit decrease was offset
by an  increase  in the  average  price of diesel  products  of 2% to  $165,814,
resulting in unchanged net sales from diesel products for the nine months.  Unit
shipments of the Company's  gas products  decreased by 770 to 1,252 due to lower
retail demand. The average price of gas motorhomes also increased 2% to $67,200.
Revenue from the sale of gas units  decreased  37%.  Unit sales of the Company's
towable  products  increased 20% to 360 units compared to 300 units in the first
nine months of 1999.  The average price of these units  decreased 1% to $35,900,
due to the introduction of the entry-level  towable products.  The average price
of towable  sales will  continue  to decline as more  entry-level  products  are
introduced.

         In addition to the  reduction in total unit  shipments  for the quarter
and nine months ended September 30, 2000,  continued  product  discounting  also
unfavorably impacted net sales.

         Cost of goods sold for the quarter ended  September 30, 2000  decreased
to $76.5 million,  a 14.4%  decrease from the comparable  quarter last year. The
decrease was due to the decrease in sales, partially offset by a one-time charge
to warranty  expense of $900,000 related to voluntary  recalls  initiated by the
Company's  Country Coach subsidiary to replace tires and wheels on approximately
85 units.

                                       9
<PAGE>
NATIONAL R.V. HOLDINGS, INC.

PART 1, ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                 RESULTS OF OPERATIONS (Continued)

         Cost of goods sold for the first nine months of 2000 decreased by $30.8
million to $232.7  million,  or 11.7%  compared to the same period in 1999.  The
decrease  was the result of reduced  sales  partially  offset by $1.9 million in
one-time  charges to warranty  expense  resulting from a voluntary  offer by the
Company to correct a weight  distribution  issue  earlier in the year as well as
the tire and wheel  issues  referred  to above.  As a result of the  discounting
indicated  above, a sales rebate program  carried out during the second quarter,
as well as the $1.9  million  in  warranty  charges,  the  gross  profit  margin
decreased to 12.7% for the  nine-month  period as compared to 16.9% for the same
period last year.

         Selling  expenses  for  the  three  months  ended  September  30,  2000
increased to $3.7 million or 19.2% from the same period last year.  For the nine
months ended September 30, 2000,  selling expenses increased to $10.2 million or
21.1%  compared to last year.  The increase for the three and nine month periods
was due to increased  wholesale  and retail sales  incentives  and the Company's
increased presence at industry shows and rallies.  As a percentage of net sales,
selling expenses increased to 3.8%, from 2.6% for the same period last year.

         General  and  administrative   expenses  for  the  three  months  ended
September 30, 2000 increased to $2.0 million or 24.0% from the same quarter last
year. For the nine months ended September 30, 2000,  general and  administrative
expenses  increased  to $6.9  million or 28.6% from last year.  The increase was
primarily due to higher compensation,  increased  headcount,  and administrative
and technology costs. As a percentage of net sales,  general and  administrative
expenses  increased to 2.6% from 1.7% for the same nine-month  period last year.
This is due to the fact that many of the general and administrative expenses are
fixed in nature and as sales decrease,  these expenses  increase as a percentage
of sales.

         Other  income for the three and nine months  ended  September  30, 2000
decreased to $0.1 million and $0.6 million,  from $0.4 million and $1.3 million,
respectively, for the same periods last year. The decreases are due primarily to
the fact that  last  year  included  a gain on the  liquidation  of the Dune Jet
Services,  LP as indicated  above.  In addition,  lower  average  invested  cash
balances resulted in reduced interest income.

         Provision  for  income  taxes  for the  three  and  nine  months  ended
September 30, 2000 decreased to $1.8 million and $6.5 million, respectively. The
effective  tax rate for the nine  months  ended  September  30,  2000 was  38.4%
compared to 39.9% for the same period last year.  The decrease in the  effective
tax rate was due to a benefit arising from usage of a capital loss carryover.

         As a result,  net income for the second  quarter of 2000  decreased  to
$2.7 million, 3.2% of net sales, compared to $9.0 million, or 8.3% of net sales,
for the same  period  last year.  Net  income for the first nine  months of 2000
decreased to $10.4 million, or 3.9% of net sales,  compared to $24.6 million, or
7.8% of net sales, for the same period last year.

                                       10
<PAGE>
NATIONAL R.V. HOLDINGS, INC.
PART 1, ITEM 3 - Quantitative and Qualitative Disclosures about Market Risk

     Information about market risks for the nine months ended September 30, 2000
does not differ materially from that discussed under Item 7A of the registrant's
Annual Report on Form 10-K for the year ended December 31, 1999.





























                                       11
<PAGE>


PART II - OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
A.    Exhibits

      Exhibit 99.1  Factors that May Affect Future Operating Results and
                    Financial Condition

B.    Reports on Form 8-K

      None






















                                       12
<PAGE>



                                   SIGNATURES

   Pursuant to the  requirements  of the  Securities  Exchange Act of 1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                                  NATIONAL R.V. HOLDINGS, INC.
                                                          (Registrant)

         Date: November 8, 2000                 By /s/ BRADLEY C. ALBRECHTSEN
                                                -----------------------------
                                                     Bradley C. Albrechtsen
                                              Chief Financial Officer (Principal
                                                Accounting and Finance Officer)
























                                       13
<PAGE>

                                  Exhibit 99.1

Factors that May Affect Future Operating Results and Financial Condition
------------------------------------------------------------------------
POTENTIAL  FLUCTUATIONS  IN OPERATING  RESULTS The  Company's  net sales,  gross
margin and operating results may fluctuate  significantly  from period to period
due to factors  such as the mix of  products  sold,  the  ability to utilize and
expand manufacturing resources efficiently, material shortages, the introduction
and consumer acceptance of new models offered by the Company,  competition,  the
addition or loss of dealers,  the timing of trade shows and rallies, and factors
affecting the recreational  vehicle industry as a whole, such as cyclicality and
seasonality. In addition, the Company's overall gross margin on its products may
decline in future periods to the extent the Company increases its sales of lower
gross  margin  towable  products or if the mix of motor  coaches  sold shifts to
lower gross margin  units.  Due to the  relatively  high  selling  prices of the
Company's  products (in  particular,  its High-Line  Class A motor  coaches),  a
relatively  small variation in the number of  recreational  vehicles sold in any
quarter can have a significant  effect on sales and  operating  results for that
quarter.

CYCLICALITY AND SEASONALITY The RV industry has been  characterized by cycles of
growth and  contraction  in  consumer  demand,  reflecting  prevailing  economic
conditions which affect disposable income for leisure-time activities.  Concerns
about the availability and price of gasoline,  decreases in consumer confidence,
increases in interest rates and reductions in available  financing have had, and
may in the future have, an adverse impact on RV sales.  Seasonal  factors,  over
which the  Company  has no  control,  also have an effect on the  demand for the
Company's  products.  Demand in the RV industry declines over the winter season,
while sales are generally highest during the spring and summer months.

EXPANSION OF MANUFACTURING  FACILITIES In 1999, the Company purchased additional
land in Perris,  California,  Junction City,  Oregon,  and Hillsborough  County,
Florida for planned expansion of manufacturing and service facilities. There can
be no assurance that such  facilities or future  additional  facilities  will be
able to meet the manufacturing  needs of the Company or that the Company will be
able to attract and retain qualified  technical,  supervisory and  manufacturing
personnel  required in order to operate  such  facilities  in an  effective  and
efficient manner.

DEPENDENCE  ON CERTAIN  DEALERS;  CONCENTRATION  OF  DEALERS IN CERTAIN  REGIONS
Although no one dealer  accounted  for more than 10% of the  Company's net sales
during the year ended December 31, 1999, the Company's top ten dealers accounted
for  approximately  43% and 44% of the  Company's  sales  during the years ended
December 31, 1999 and 1998, respectively. The loss by the Company of one or more
of these dealers could have a material adverse effect on the Company's financial
condition and results of operations.  In addition,  a significant portion of the
Company's  sales is from  dealers  located in states in the western  part of the
United States.  Consequently, a general downturn in economic conditions or other
material events in such region could  materially  adversely affect the Company's
sales.

DEPENDENCE  ON CHASSIS  SUPPLIERS One of the  principal  components  used in the
manufacture  of  motorhomes  and bus  conversions  is the chassis and bus shell,
respectively,  which  include  the  engine,  drive  train  and  other  operating
components.  Although Country Coach manufactures  chassis used in certain of its
products,  the  Company  obtains  the  required  chassis for most of its Class A
motorhomes  from a limited number of  manufacturers  and the required bus shells
from Prevost Corporation. Prevost is the only manufacturer of bus shells used in
the Company's bus  conversions  and there is only one other  manufacturer of bus
shells in North America. As is standard in the industry,  arrangements with such
suppliers  permit them to terminate their  relationship  with the Company at any
time. Lead times for the delivery of chassis  frequently  exceed five weeks, and
the RV industry as a whole has from time to time experienced temporary shortages
of  chassis.  If  any  of  the  Company's  suppliers  were  to  discontinue  the
manufacture of chassis utilized by the Company in the manufacture of its Class A
motorhomes,  materially reduce their  availability to the RV industry in general
or limit or  terminate  their  availability  to the Company in  particular,  the
business  and  financial  condition  of the  Company  could  be  materially  and
adversely affected.

POTENTIAL  LIABILITIES UNDER REPURCHASE AGREEMENTS As is common in the industry,
the Company enters into repurchase  agreements  with the financing  institutions
used by its dealers to finance their purchases.  These  agreements  obligate the
Company to purchase a dealer's  inventory  under  certain  circumstances  in the
event of a default by the dealer to its lender.  The risk of loss,  however,  is
spread over many  dealers and is further  reduced by the resale value of the RVs
that the Company would be required to  repurchase.  Although  losses under these
agreements have not been  significant in the past, if the Company were obligated
to  repurchase  a  significant  number of RVs in the future,  it could result in
losses and a reduction in new RV sales.  The  Company's  contingent  obligations
under repurchase agreements vary from period to period and totaled approximately
$104.5 million as of December 31, 1999.

COMPETITION The Company competes with numerous manufacturers, many of which have
multiple  product  lines  of RVs,  are  larger  and have  substantially  greater
financial and other resources than the Company. According to an industry source,
the  two  largest  motorhome   manufacturers  had  sales  aggregating  39.8%  of
industry-wide  retail  unit  sales of  Class A  motorhomes  for the  year  ended
December 31,  1999.  In addition,  sales of used RVs provide  competition  to RV
manufacturers.

GOVERNMENT  REGULATION  The  Company  is  subject  to  federal,  state and local
regulations governing the manufacture and sale of their products,  including the
provisions  of the  National  Traffic and Motor  Vehicle  Safety Act (the "Motor
Vehicle Act") and the safety  standards for RVs and  components  which have been
promulgated  thereunder by the Department of  Transportation.  The Motor Vehicle
Act authorizes the National Highway Traffic Safety  Administration  ("NHTSA") to
require a  manufacturer  to recall and repair  vehicles  which  contain  certain
hazards or  defects.  The  Company  has from time to time  instituted  voluntary
recalls of certain  motorhome  units,  none of which has had a material  adverse
effect on the Company.  Future recalls of the Company's  vehicles,  voluntary or
involuntary,  however,  could have a material adverse effect on the Company. The
Company is also subject to federal and numerous  state  consumer  protection and
unfair trade practice laws and regulations relating to the sale,  transportation
and marketing of motor vehicles, including so-called "Lemon Laws."

Federal  and state laws and  regulations  also  impose  upon  vehicle  operators
various  restrictions  on the  weight,  length  and  width  of  motor  vehicles,
including trucks and motorhomes,  that may be operated in certain  jurisdictions
or on certain  roadways.  As a result of these  restrictions,  certain models of
motorhomes  manufactured  by the Company's  Country Coach  subsidiary may not be
legally  operated  in  certain  jurisdictions  or on certain  roadways.  Certain
jurisdictions also prohibit the sale of vehicles exceeding length  restrictions.
Enforcement  of these  laws and  related  customer  complaints  to date has been
limited.  The  Company  is  unable  to  predict  reliably  the  extent of future
enforcement of these laws, the extent future  enforcement might lead to customer
complaints,  or the extent to which  Country  Coach may choose or be required to
provide some customer remedy, such as repurchasing or exchanging motorhomes,  as
a  result  of such  complaints.  If  current  enforcement  efforts  and  related
complaints were to increase significantly from their current levels, the cost of
resolving  such  complaints,  particularly  should the  resolution of complaints
require repurchasing,  refurbishing,  and reselling of motorhomes,  could have a
material financial effect on the Company.

Amendments and changes in enforcement with respect to these laws and regulations
and the implementation of new laws and regulations could significantly  increase
the costs of  manufacturing,  purchasing,  operating  or selling  the  Company's
products and could have a material  adverse  effect on the  Company's  business,
results of  operations  and financial  condition.  The failure of the Company to
comply with these  present or future laws or  regulations  could result in fines
imposed  on  the  Company,  civil  and  criminal  liability,  or  suspension  of
operations, any of which could have a material adverse effect on the Company.

The Company's  manufacturing  operations are subject to a variety of federal and
state  environmental  regulations  relating  to the  use,  generation,  storage,
treatment,  emissions,  and disposal of hazardous materials and wastes and noise
pollution.  Such laws and  regulations  are becoming more  stringent,  and it is
likely that future  amendments to these  environmental  statutes and  additional
regulations  promulgated  thereunder  will be  applicable  to the  Company,  its
manufacturing  operations  and its  products in the  future.  The failure of the
Company to comply with present or future regulations could result in fines being
imposed on the Company, civil and criminal liability,  suspension of operations,
alterations  to  the   manufacturing   process  or  costly  cleanup  or  capital
expenditures.

WARRANTY CLAIMS AND PRODUCT  LIABILITY The Company is subject to warranty claims
in the ordinary course of its business.  Although the Company maintains reserves
for such  claims,  which to date have been  adequate,  there can be no assurance
that warranty expense levels will remain at current levels or that such reserves
will continue to be adequate.  A large number of warranty  claims  exceeding the
Company's  current  warranty expense levels could have a material adverse effect
on the Company's results of operations and financial condition.

The Company maintains product liability insurance with coverage in amounts which
management  believes is reasonable.  To date, the Company has been successful in
obtaining product liability insurance on terms the Company considers acceptable.
Given the nature of the Company's  business,  product liability in excess of the
Company's insurance coverage, if incurred,  could have a material adverse effect
on the Company.

INTEGRATION  OF ACQUIRED  BUSINESSES;  MANAGEMENT OF GROWTH One of the Company's
objectives  is to  acquire  businesses  in the RV  industry  or  related  areas.
Successfully accomplishing this goal depends upon a number of factors, including
the  Company's  ability  to  find  suitable  acquisition  candidates,  negotiate
acquisitions on acceptable terms, retain key personnel of the acquired entities,
hire  and  train  other  competent  managers,  and  effectively  and  profitably
integrate the operations of the acquired  businesses into the Company's existing
operations.  The  process  of  integrating  acquired  businesses  may  require a
significant   amount  of  resources  and  management   attention,   which  could
temporarily detract attention from the day-to-day  business of the Company.  The
Company's  ability to manage its growth  effectively will require it to continue
to improve its  operational,  financial and management  information  systems and
controls, and to attract, retain, motivate and manage employees effectively. The
failure of the Company to manage growth in its business effectively could have a
material adverse effect on the financial  condition and results of operations of
the Company.

ANTITAKEOVER  PROVISIONS  Certain  provisions  of the Company's  Certificate  of
Incorporation,  as well as Delaware corporate law and the Company's  Stockholder
Rights Plan (the "Rights Plan"), may be deemed to have anti-takeover effects and
may delay, defer or prevent a takeover attempt that a stockholder might consider
in its best  interest.  Such  provisions  also may adversely  affect  prevailing
market  prices  for the  Common  Stock.  Certain  of such  provisions  allow the
Company's Board of Directors to issue, without additional  stockholder approval,
preferred  stock having rights senior to those of the Common Stock. In addition,
the  Company is subject to the  anti-takeover  provisions  of Section 203 of the
Delaware General Corporation Law, which prohibits the Company from engaging in a
"business  combination"  with an "interested  stockholder" for a period of three
years after the date of the transaction in which the person became an interested
stockholder, unless the business combination is approved in a prescribed matter.
In August 1996, the Company  adopted the Rights Plan,  pursuant to which holders
of the Common Stock  received a  distribution  of rights to purchase  additional
shares of Common Stock,  which rights become  exercisable upon the occurrence of
certain events.