Key facts
- The 21st Century ROAD to Housing Act, passed July 11, enables the removal of permanent chassis for manufactured homes.
- Cavco Industries and Champion Homes executives prioritize design flexibility and urban market access over cost savings from chassis removal.
- Savings from chassis removal are expected to be offset by increased costs for structural materials and installation.
- Chassis removal could allow for multi-story manufactured homes, opening opportunities in high-cost urban markets.
- Manufactured homes without chassis may appear more like site-built homes, potentially reducing stigma.
- Both Cavco and Champion believe their factories are equipped to produce homes without permanent chassis.
The 21st Century ROAD to Housing Act, enacted on July 11, has shifted the conversation around manufactured housing from advocacy to the practicalities of removing permanent chassis requirements. Executives at major U.S. manufactured housing builders Cavco Industries and Champion Homes view this change as a long-term growth opportunity, emphasizing enhanced design flexibility and access to urban markets over potential cost savings.
While widely reported cost savings from eliminating the permanent steel chassis range from $5,000 to $10,000 per home, Cavco CEO William Boor indicated these savings would be partially offset by the need for additional structural materials and higher installation costs. Boor sees the change primarily as an opportunity for product innovation and breaking down zoning barriers to enter urban areas. Champion Homes CFO Dave McKinstray echoed this sentiment, stating the change is more about altering the aesthetic of homes to rival site-built properties rather than a cost-driven initiative.
Removing the permanent chassis, alongside a proposed HUD rule allowing upper-level sections to be transported without a chassis, could simplify the construction of multi-story manufactured homes. This is seen as a significant opportunity for companies like Cavco and Champion to enter expensive urban infill markets. Clayton Homes, another major producer, also praised the regulatory change, releasing conceptual renderings of two-story manufactured homes without permanent chassis.
The change also allows manufactured homes to sit lower on foundations, improving their appearance and potentially reducing the stigma associated with them. This could lead to greater acceptance by municipalities and planning boards. Several states, including Florida, Texas, Kentucky, Virginia, Montana, and Maine, have recently passed laws requiring local governments to permit manufactured homes in various zoning districts.
Both Cavco and Champion expressed confidence in their factories' readiness to adapt to producing homes without permanent chassis, as they already manufacture modular homes. They view the chassis removal as another product configuration rather than a major technological leap. The companies also see an opportunity to offer optionality, continuing to produce homes with permanent chassis for customers who prefer them.