In what truly is an example of the law of unintended consequences, the subprime mortgage mess may actually benefit RV and manufactured home maker Fleetwood Enterprises Inc. (NYSE: FLE), CEO Elden Smith suggested. The reasoning is that as mortgages for those with more modest creditworthiness become more difficult to obtain, consumers will take a look at manufactured housing which can often be financed through the manufacturer. Manufactured housing costs less and carries a lower monthly payment.

Fleetwood could use some good news. The company released 1QFY 2008 numbers last week that were not encouraging. Revenues were down 4%, not surprising since gas prices were up by a whole lot more and most of Fleetwood's business centers around its RV Group. The company generated $6 million in income for the quarter, which would be good news if $5.3 million of this money had not come from selling an unused production facility. In actual fact, losses at the company widened during the quarter from $400,000 net loss in 1Q 2007 to a net loss of $2.3 million in 1Q 2008. For the past several quarters, Fleetwood has been selling off company assets to help offset operating losses.

Fleetwood Enterprises is trying to manufacture smaller, more fuel-efficient RV models, which have generated some interest among RV dealers. But the dealers are reluctant to stock up any inventory while demand for RVs is still so soft. Folding trailer sales were down 10% by volume. This news is in keeping with survey results that show fewer Americans are taking camping trips to national parks and other federally managed outdoor locations. Also, there are fewer trailer parks in the prime retirement states of Arizona, Florida and California, as municipalities turn the land over to developers to generate more tax revenue. Fleetwood CEO Elden Smith did not offer any guidance for FY 2008 figures, but don't look for Fleetwood's problems to be solved anytime in the immediate future. The stock closed at $8.91, down $0.49 on Friday.