ELKHART — The chief executive officer of Forest River made a bold prediction about two months ago at the RV Industry Breakfast in Elkhart.
Pete Liegl predicted Forest River and Thor Industries would grow to each account for 40 percent of recreational vehicle sales nationwide.
Though both Elkhart companies are growing, they're no longer neck-and-neck competitors. Thor's recent $576 million purchase of Middlebury-based Jayco has cemented its position as the industry's largest RV manufacturer; Forest River, owned by Warren Buffett-led Berkshire Hathaway, has become a distant second.
Jayco, which was owned by the Bontrager family since 1968, is just the latest example of a company accepting a buyout offer to join a larger one. Such consolidation has become increasingly common in the industry, which has enjoyed six straight years of growth and is on track for a record-breaking year in wholesale RV shipments.
Taking advantage of record sales, big RV manufacturers, suppliers and dealers are snapping up their smaller competitors. Those sellers are cashing in on the industry's prosperity, knowing that massive payouts probably won't be available when the next downturn hits.
The industry's rapid consolidation has also brought economic perks.
In most cases, millions of dollars from such transactions will likely be injected by sellers back into the local economy, said Mark Dobson, CEO of the Economic Development Corp. of Elkhart County. "I believe a significant portion of it will continue to circulate in the marketplace long after exit strategies are done," he said, adding that sellers might use the money to launch other businesses, for example, or to make charitable donations.