Clayton Homes

Clayton Homes is a prominent American manufacturer and retailer of modular homes and mobile homes. Founded in Tennessee, the company operates as a vertically integrated enterprise, overseeing production, sales, financing, and insurance. It is a wholly owned subsidiary of the multinational conglomerate Berkshire Hathaway, a relationship that has significantly shaped its market position. The company maintains a vast network of retail sales centers and manufacturing facilities across the United States.

History

The company was established in 1966 by Jim Clayton in Knoxville, Tennessee, initially focusing on the sale of used mobile homes. Its early growth was fueled by strategic acquisitions of retail lots and a shift toward selling new units. A pivotal moment occurred in 1999 with the acquisition of Oakwood Homes Corporation, a major competitor, which dramatically expanded its manufacturing capacity and retail footprint. The most significant event in its corporate history was its 2003 purchase by Berkshire Hathaway, led by Warren Buffett, for approximately $1.7 billion. This acquisition provided immense financial stability and resources for further expansion, including the later integration of the CMH Manufacturing and Schult Homes brands into its portfolio.

Business model and operations

The company employs a vertically integrated business model that controls most aspects of the homeownership process. Its operations encompass the manufacturing of homes across numerous branded facilities, such as those formerly operating as Golden West Homes and Fleetwood Homes. The retail segment is conducted through a nationwide chain of company-owned sales centers, often doing business under local names like Karsten Homes and Meadowbrook Homes. A critical component is its in-house financial services arm, Clayton Homes Finance, which provides loans to buyers, and its insurance services, which offer property and casualty coverage. This integrated approach allows it to manage the entire customer journey from factory to financed home.

Products and services

Its primary products are factory-built housing, including HUD Code manufactured homes and modular homes constructed to local building codes. The homes are marketed under various brand names that cater to different regional styles and price points, such as Ashley Homes and Cavalier Homes. Beyond physical structures, the company provides extensive ancillary services, which are central to its model. These include consumer financing through its lending division, Vanderbilt Mortgage and Finance, and insurance products from its subsidiary, Clayton Insurance Agency. It also offers land-and-home packages and manages a network of affiliated independent retailers.

Corporate affairs and ownership

Since 2003, the company has been a wholly owned subsidiary of Berkshire Hathaway, operating within its Berkshire Hathaway Energy and Manufacturing reporting segments. Its corporate headquarters are located in Maryville, Tennessee. Key leadership has included founders Jim Clayton and his son, Kevin Clayton, who has served as CEO. The company's operations and lending practices have occasionally been the subject of scrutiny, including investigations referenced by the United States Senate and reporting by The Seattle Times. Its corporate strategy is closely aligned with the long-term investment philosophy of its parent company.

Industry impact and recognition

The company is widely regarded as the largest player in the manufactured housing industry in the United States, significantly influencing market consolidation and practices. Its integration under Berkshire Hathaway brought unprecedented scale and attention to the sector. The company has received various accolades from industry publications like Manufactured Home Merchandiser and has been recognized for its volume. Its business practices, particularly its control of financing, have shaped competitive dynamics and consumer choice within the affordable housing market, making it a defining entity in its field.

Category:Companies based in Tennessee Category:Manufactured housing companies of the United States Category:Berkshire Hathaway subsidiaries Category:Companies established in 1966