Monday, May 4, 2020

How are Modular Factories Preparing for Post COVID-19?

When it was announced that Pennsylvania’s Governor would allow modular home factories in the state to restart production I reached out to several to learn what measures they’ve implemented.

The response was for the most part what we expected to hear but a couple of the replies showed that what is happening today will need to be watched carefully and adjusted over the next year

The modular factories I polled ranged from small boutique type to large production factories and LGS modular production.

Do you anticipate changes within your production line and office operations?

All of them have our protocols in place based on the PA Dept of health, signage, sanitation stations, plexiglass screening in offices training staff being separated in the office and the plant workers practicing social distancing

Face masks, sanitizing work areas , break rooms and offices is an everyday, sometimes a 2-3 times a day practice. Limiting the spacing between employees is the biggest challenge.

“I don’t care if you are a big numbers producer or a one a day shop, you are going to have to be very diligent about limiting the duration of how close employees get to one another. It is inevitable that they get closer than 6’, just by the nature of what we do , but you have to be very diligent in reminding them to space out.”

Other processes some are using is when employees enter the building to start the work day, they have their temperature taken. Each employee's temp is recorded on a daily basis for our records. If the employee registers more than 99.5 degrees they are sent home with the recommendation that they tele-med their physician for his/her diagnosis. That employee is not allowed back to work until they have provided proof of negative diagnosis.

Are you changing suppliers within your supply chain to more American Made materials?

There is no question that the backlash of materials from China due to the COVID-19 virus will be a major concern to many factories. Most will try to buy all of our materials from Non-Chinese suppliers.

Do you see any significant delays with permitting from state regulatory agencies?

Salespeople have been calling local building departments to get updates but it has been a challenge to get people on the phone. Things seemed to open a little this week but it is day by day as the local and state building departments are facing the same “work from home” and social distancing problems all government agencies face.

Not much has been done in this area and they are going to have to catch up to the backlog.

Will modular housing factories be affected by stricter mortgage requirements?

Several modular factory Sales Managers this is the deeper/darker issue lurking in the background. How does a buyer that needs a mortgage give proof of employment via pay stubs, if they have been laid off . Suppose that buyer had to dip into savings or use their available credit to get by during the lockdown? All this plays into the future start up of the single family side.

A couple of factories that build a lot of multi-module told me that projects for hotels, affordable housing and apartments could face an even bigger problem.

Suppose the lender to a builder/ developer of a multi-family project gets freaked out about the proforma on the job and the marketability/rent up of a job that has not been started and decides to delay funding until the dust settles on what will happen with the economy? That could have a major impact on modular factories that only do large projects.

Look at the hotel business for example. There are projections out there that say that travel and hotel stays will not reach the levels they were enjoying, for at least 2 years from the restart. Those jobs will just have to wait for funding and start up .

Will there be changes for your service people when they visit the jobsite or the customer’s finished home?

Every factory has put in place protocols for their service and delivery drivers. Outsourcing of service work to builders and their subs will be more prevalent depending upon the hot spots that exist and the projections of the further spread of this virus.

Is your workforce ready to come back to work?

Many companies whether in this business or another that were able to work faced a reluctance of their workers to come back to work. I’ve heard that some modular factories have had up to 50% of their work force not want to return to work until there is some authority that confirms that the worst is over.

The next 12 months are going to be tough for everyone in the construction industry until a New Normal is established.

Gary Fleisher is a housing veteran, editor/writer of Modular Home Builder blog and Modular Construction Industry Observer and Information Gatherer

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