New Line Is No Big Stretch : Automobiles: Anaheim’s Krystal Koach has expanded from making limos into the hearse business. The country’s aging demographics could mean boom times ahead.
Newborns have come home from the hospital in Ed Grech’s limousines. His custom-made cars have also transported dressed-to-the-nines teen-agers to the prom, brought brides to the church and carried celebrating couples to their 50th anniversary parties.
Now, Grech is closing the circle. Krystal Koach Co., Grech’s 12-year-old company and the nation’s largest stretch limo maker, has begun building hearses. You’ll rarely hear that word in use around Krystal’s four-building complex, though. The preferred name is “funeral coach.”
In 1994--Krystal’s first year in the new venture--120 coaches, most of them black with rich purple upholstery, rolled out of the Anaheim industrial park that the company is rapidly outgrowing.
This year, Grech said, the number should double. And by the end of the decade, Krystal Koach expects to be making as many hearses as limos--600 of each annually. “We looked all around for ways to diversify, and funeral coaches were a natural for us,” Grech said.
Grech figures that time in on his side. The nation’s sizable limo business has probably peaked, he said. There are 8,000 livery companies and 50 limo makers to keep that industry supplied. And as the baby boom generation ages, there are apt to be fewer weddings, christenings and proms to keep up
production demand for their opulently appointed Lincolns and Cadillacs.
But the same aging process ensures that the funeral business will grow. And there are just eight hearse makers in the United States to keep 21,000 funeral homes supplied with coaches.
The first of the 77 million baby boomers--people born in the United States between 1946 and 1964--will turn 65 in the year 2012. By 2030 there will be about 65 million people over 65, up from just 30 million now.
Even if the death rate from disease continues to decline, as it has in recent years because of health-care advances, old age will still account for big increases in the number of deaths through much of the next half century.
And that, Grech said, means more funerals and more demand for hearses, for funeral directors are under competitive pressure to keep the newest models in their fleets.
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“We have a 1972 Cadillac hearse that is just a gorgeous, classic old model, but we don’t use it that much because some people complain,” said Pat Cabot, co-owner of Cabot & Sons Funeral Directors, a Pasadena mortuary established in 1921.
“Most people want the newest, freshest looks,” he said. Cabot, like most mortuaries, rarely keeps a hearse or limousine more than four years, he said.
Krystal, which was already selling limos to the funeral industry, didn’t need to do much to add hearses to its product line. Employees’ limo-building skills and the company’s extensive customizing equipment were readily adapted, Grech said, while cash flow from the successful and still-growing limousine business provided a comfortable financial cushion during the diversification to hearses.
Last year’s production appears to make Krystal the fourth biggest hearse manufacturer in the country, said Gregg Merksamer, an upstate New York writer who covers the funeral coach industry for the trade journal American Funeral Director.
The biggest, and oldest, is S&S; Superior in Lima, Ohio. The company, a merger of two former competitors, traces its roots to S&S; Coach, founded in 1876. Last year, the company produced an estimated 1,200 hearses, Merksamer said.
Another Ohio company, Miller Meteor-Eureka Coaches, formed by a merger in the late 1970s, produces about 600 hearses a year, Merksamer said.
Federal Coach, a Ft. Smith, Ark., company that started as a stretch limo builder, is third, with about 400 units a year.
Krystal and Eagle Coach of Amelia, Ohio, are tied for fourth place, Merksamer said. The Anaheim company’s ability to sell 120 hearses its first year in the business, he said, “shows that it has a lot of potential.”
The fact that the company is the only hearse builder on the West Coast is a big advantage, said Bill Cummings, owner of Southwest Coach, a Santa Monica dealer that represents Krystal, Eureka and S&S; Superior in California, Nevada and Arizona.
“Their coaches are very well built,” he said. “And because they build in California, buyers here can save about $1,400 in shipping charges that they’d have to pay for a coach that was built in Ohio.”
The selling price of a Krystal hearse averages $55,000, about the same as one of S&S;’s mid-line coaches. (The Ohio company makes a highly customized model that runs almost $66,000.)
While Krystal is new among hearse makers, its 12-year history in the limo business should help reassure prospective buyers that it is a dependable manufacturer, Cummings said.
“When they were building their prototype, they had dealers and funeral directors from all over the country come in and look at it and make suggestions,” he said. “They tore apart coaches made by the competition. They made sure they were building a coach that offered what the customers wanted. I can see them stepping up and becoming a major player in the industry.”
Merksamer, a self-described hearse and ambulance buff whose degree in industrial design included a thesis on future trends in the funeral coach industry, said Krystal’s hearses “are very tastefully done, although a bit derivative.”
Because of their function, though, hearses are conservative in design. While an occasional model is built on Ford, Lincoln, Buick, Rolls Royce or Chrysler minivan underpinnings, the vast majority are Cadillac-based. That is mainly because Cadillac historically was the only passenger vehicle large enough to carry a casket. Also, Cadillac-based hearses have more interior room than Fords or Buicks.
“People just seem to prefer Cadillacs,” Grech said of the funeral directors who buy hearses.
Grech’s business plan is for his limo business to continue to grow slowly while his hearse business takes off. “I can see the day when we’ll be building more funeral coaches than limousines,” he said.
To that end, Grech said, he is in discussions with Anaheim about a plan to buy a tract of land in a nearby industrial park--he wouldn’t specify where--and build a 100,000-square-foot manufacturing and office complex for Krystal Koach.
When completed and operating to capacity, the plant would need about 100 more workers than the 212 now employed at Krystal’s 65,000-square-foot facility.
Orange County government’s recent financial difficulties--a $2.02-billion investment loss that affected the finances of almost every city in the county, including Anaheim--has slowed the negotiations, Grech said.
Also, Krystal was counting on tax or utility cost relief from the city or even help with the land purchase, he said. That must wait until city officials straighten out their own finances.
“But we are going to do it,” Grech vowed. “It’s our future.”
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Somber Sales
Here’s how the five largest hearse builders in the United States rank in terms of estimated 1994 production. Number of units made:
Eagle Coach, Amelia, Ohio: 120
Krystal Koach Co., Anaheim, Calif.: 120
Federal Coach, Ft. Smith, Ark.: 400
Miller Meteor-Eureka Coaches, Norwalk, Ohio: 600
S&S; Coach, Lima, Ohio: 1,200
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Source: Gredd Merksamer, funeral coach industry writer;
Researched by VALERIE WILLIAMS-SANCHEZ / Los Angeles Times
Limo Maker Expands
Although Krystal Koach has grown steadily since it was founded in 1983, adding hearse construction to its product line last year meant more employees and increased sales. Projections for this year also look positive:
Sales, in millions: $47.0
Employees: 212
Units built: 840*
* Includes 120 hearses in 1994; 240 projected in 1995
Source: Krystal Koach inc.; Researched by Valerie Williams-Sanchez / Los Angeles Times
