Coachmen Industries, Inc. Announces Agreement to Develop Alternative Energy Sources for Recreational Vehicles and Modular Housing.

ELKHART, Ind. -- Coachmen Industries, Inc. (NYSE: COA) today announced that it has entered into an agreement with Natural Source Energy Systems Inc. (NSESI) to research and develop recreational vehicles and systems-built structures that take advantage of environmentally friendly biodiesel fuel and solar power.

"Today, all of us are concerned about the degradation of our environment, and not just about energy costs. 'Green' is good business," said Rick Lavers, chief executive officer of Coachmen Industries. "We are very pleased to have teamed with up NSESI to explore practical applications for solar energy and biodiesel fuels, for both our RVs and our housing products."

To begin, Coachmen Industries is providing NSESI with a Sportscoach Class A diesel pusher, a Coachmen Class C diesel motorhome and a Coachmen fifth wheel trailer. NSESI will adapt the Coachmen units to incorporate new state of the art, high efficiency solar panels. Once the prototypes are ready, the companies will put the RVs through extensive testing using solar energy and biodiesel fuel across the country.

"We believe that our builders, dealers and customers will respond very positively to this initiative," said Lavers. "All of our products consume energy in their operation. It makes sense to be on the cutting edge of developments to reduce their cost of operation and emissions through alternative energy sources and renewable energy."

NSESI is a multinational corporation that has been working on developing renewable energy products since 2005. Earlier this year, the company began marketing a wide variety of products including photovoltaic cells, solar heat panels, solar water heaters and biodiesel fuels.

Matt Schaub, marketing manager for NSESI, said his company is seeking to convert the motorhomes to run on biodiesel fuel and to use solar panels to generate onboard power. "Our objective is to reduce RV reliance on generators as a secondary power source. Using solar panels to generate the electric power an RV needs is quieter, and why burn fossil fuels when you can get the energy free from the sun?" said Schaub.

Coachmen Industries and NSESI also are looking at NSESI's solar technology for applications that can be used by Coachmen Industries' modular housing division. "When directly overhead, the sun produces approximately 1,000 Watts of electrical power per square meter," said Schaub. "While the usable energy extracted from that will depend on a variety of factors, a reasonably sized and efficient array of solar panels can produce significant power. This can make homes much less dependent on fossil fuels for energy."

"It is too early to discuss when this technology will go into production. We have a tremendous amount of testing to do before we begin building RVs or structures with solar panels, but we are excited about the prospect of improving the energy efficiency of our product offerings," concluded Lavers.

Coachmen Industries, Inc., through its prominent industry subsidiaries, is one of America's leading manufacturers of recreational vehicles, systems-built homes and commercial buildings. The Company's well-known RV brand names include COACHMEN([R]), GEORGIE BOY([R]), SPORTSCOACH([R]) and VIKING([R]). Coachmen's ALL AMERICAN HOMES subsidiary is one of the nation's largest producers of systems-built homes, and also a major builder of multi-family residential and commercial structures with its ALL AMERICAN BUILDING SYSTEMS([R]) products. Coachmen Industries, Inc. is a publicly held company with stock listed on the New York Stock Exchange (NYSE) under the ticker COA.

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors are cautioned not to place undue reliance on forward-looking statements, which are inherently uncertain. Actual results may differ materially from that projected or suggested due to certain risks and uncertainties including, but not limited to, the potential fluctuations in the Company's operating results, increased interest rates, the availability for floorplan financing for the Company's recreational vehicle dealers and corresponding availability of cash to Company, uncertainties and timing with respect to sales resulting from recovery efforts in the Gulf Coast, uncertainties regarding the impact on sales of the disclosed restructuring steps in both the recreational vehicle and housing and building segments, the ability of the company to generate taxable income in future years to utilize deferred tax assets and net operating loss carry-forwards available for use, the impact of performance on the valuation of intangible assets, the availability and the price of gasoline, price volatility of raw materials used in production, the Company's dependence on chassis and other suppliers, the availability and cost of real estate for residential housing, the supply of existing homes within the company's markets, the impact of home values on housing demand, the ability of the Housing and Building segment to perform in new market segments where it has limited experience, adverse weather conditions affecting home deliveries, competition, government regulations, legislation governing the relationships of the Company with its recreational vehicle dealers, consolidation of distribution channels in the recreational vehicle industry, consumer confidence, uncertainties of matters in litigation, further developments in the war on terrorism and related international crises, oil supplies, and other risks identified in the Company's SEC filings.