RVIA Economic Impact Study

The Recreation Vehicle Industry Association commissioned an Economic Impact Study on the RV industry, released on June 7, 2016. The study found that the RV industry contributes about $49.7 billion in economic output or 0.28 percent of the Gross Domestic Product. Through its production and distribution linkages, the industry impacts firms in 426 of the 440 sectors of the United States economy.

Nationwide, the industry is responsible for 216,170 jobs, both directly and inderectly, creating an economic impact of $37.5 billion. The full study results, along with each individual state and congressional district's economic impact is available on the website by clicking here .

Patrick Industries Serves as Example of Navigating Through Recession

Tue Dec 5, 2017
Author: Ken Skarbeck

145677893217453.pngAn example of a management team that skillfully navigated the brutal economy of 2008-09 and, over the ensuing nine years, grew a thriving business is Elkhart Indiana’s Patrick Industries.

In 2009, Elkhart County, known as the recreational vehicle capital of the world, had an unemployment rate of 19 percent. Congress’ Recovery Act sent $169 million in stimulus funding to Elkhart, and the economy began its slow, but extended recovery. From the depths of the crisis, Patrick Industries has grown into a highly profitable enterprise.

During the calm before the storm, in 2007, Patrick had doubled in size with a couple of acquisitions but had also nearly tripled its debt load to $125 million. In the fall of 2007, Patrick’s shares spiked to $11 in tandem with the overall stock market. Then, as the subprime loan market began to fracture, the bottom fell out. RV and manufactured housing shipments plummeted 50 percent. Patrick’s shares crashed to 17 cents in March 2009 (even though book value per share was $7.20.)

Patrick Industries, which was valued by investors at $66 million in July 2007, was 18 months later selling for $1.5 million. Investors essentially believed Patrick was going out of business, according to a story by the Indiana Business Journal.

Enter Todd Cleveland, who was named Patrick’s CEO in February 2009 at the age of 41. Cleveland came to Patrick in 2007 with the $78 million acquisition of Adorn Holdings, a manufacturer of interior components for the RV and manufactured-housing industries.

During 2008-09, Patrick paid down more than $60 million in debt with proceeds from a stock-rights offering, the sale of an idle building, and operating cash flow.

Then, over the next eight years, Cleveland and his management team made 33 acquisitions totaling $450 million, many of them businesses in the Elkhart area. From 2009-12, the purchases were small, averaging $2.5 million, for 13 businesses. In 2013-14, another nine acquisitions averaged $10 million per business. Thirteen acquisitions were made in 2015-16 at an average price of $27 million. And this year, Patrick bought LPE for $73 million to substantially increase its marine-products platform.