Patrick Industries is pursuing a proposed $8 billion merger with Lippert, the other major distributor of recreational vehicle components. Announced June 30 and structured entirely in stock, the combination would create a supplier capable of providing well over half the parts needed for a finished RV.

The deal represents the boss level of a decades long consolidation campaign. Patrick owns more than 85 brands across the RV, manufactured housing, and marine industries, while a lawsuit says it has acquired 65 businesses since 2017.

Many of those purchases were too small to trigger federal merger review. Since 2023, Patrick has spent $560 million on mergers, steadily narrowing the network of component suppliers available to RV manufacturers before moving to absorb its largest remaining rival.

Seaflo Marine argues that its experience with Patrick offers a warning about what greater consolidation could bring. In 2019, Seaflo signed an exclusive five year contract under which Patrick was supposed to purchase 500,000 units of a waterless P-trap used in RV plumbing.

Patrick initially ordered 30,000 units, but later purchased only 10,000 additional components. Seaflo says the shortfall cost it roughly $2 million, prompting a breach of contract lawsuit and discovery that exposed Patrick’s relationship with a competing product.

Before signing the Seaflo agreement, Patrick subsidiary LaSalle Bristol was completing work on the Utopia Uniguard, another waterless P-trap. The product received certification on April 9, 2019, ten days before Patrick signed the exclusive contract with Seaflo.

Patrick began selling the Uniguard in May 2019. Seaflo alleges that Patrick eventually sold one million Uniguard units, producing $7.9 million in revenue, despite contract language barring Patrick from promoting, designing, manufacturing, or distributing competing products.

Internal messages cited in the lawsuit indicate that Patrick employees considered Seaflo’s product cheaper and higher quality. Yet the company continued favoring LaSalle Bristol, which sought to protect its margins and avoid price competition between the two products.

“The exclusive agreement that was supposed to launch the Seaflo Product became the instrument of its exclusion,” Seaflo’s revised lawsuit states. The lawsuit, filed in September, is ongoing, and Patrick did not respond to detailed questions from the Prospect.

The case arrives as Elkhart, Indiana, confronts renewed weakness in the RV industry that anchors its economy. More than 80% of the world’s RVs are produced there, making declining sales and industry consolidation particularly consequential for local workers and suppliers.

Elkhart unemployment rose from 2.7% in April to 4.2% in July before falling to 3.8% in August. The RV Industry Association cut its summer sales forecast by 8.4%, while August shipments fell at twice that rate and prices subsequently dropped.

Patrick’s most recent quarterly sales were flat as RV shipments declined 16%, and its stock reached a 52 week low on Tuesday. Still, Patrick increased its dividend for a seventh consecutive year while presenting the Lippert acquisition as an answer to industry weakness.

Patrick says the merger could generate $150 million in “cost synergies.” The combination would also leave manufacturers without the ability to play Patrick and Lippert against each other on price, while independent suppliers would have little choice but to work through the merged company.

Sen. Mike Lee, the Republican chair of the Senate Antitrust Subcommittee, raised significant antitrust concerns before the deal was consummated. He warned that the merged company could gain leverage to raise prices or reduce output, with higher costs ultimately reaching RV buyers.

THOR, a major RV manufacturer with more than 50 brands, listed the merger as a potential business risk in its annual report. The deal is expected to close during the first half of next year, while Seaflo continues its legal challenge against an industry giant that could soon become the only game in town.