Warren Buffet's Dealerships

NYSpeed Automotive NYSpeed Off Topic
1

[Warren Buffett](http://www.cnbc.com/id/10000263?__source=msn|money|inline|story|&par=msn&doc=102052543|US stock futures mildly h) is getting into the auto business.

The billionaire investor announced on CNBC on Thursday that he’s buying Van Tuyl Group, the nation’s largest privately held car dealership chain.
Buffett said on “[Squawk Box](http://www.cnbc.com/id/15838368?__source=msn|money|inline|story|&par=msn&doc=102052543|US stock futures mildly h)” it took awhile but Berkshire Hathaway (BRK.A) is now “planes, trains and automobiles.” Berkshire owns BNSF Railway and private plane company NetJets.
He expects to use this agreement as a vehicle to buy other dealerships.

http://img.s-msn.com/tenant/amp/entityid/BB6ZQP5.img?h=382&w=728&m=6&q=60&o=f&l=f&x=841&y=425 © Provided by CNBC
The new company will be renamed Berkshire Hathaway Automotive, but will still be run by Larry Van Tuyl, who will become chairman. Van Tuyl’s Jeff Rachor will assume the role of CEO.
There’s a huge opportunity for consolidation in auto dealerships, Van Tuyl told CNBC, while sitting next to Buffett.
The Van Tuyl family founded the group 62 years ago, and it’s now No. 5 overall in U.S. auto dealerships with about $9 billion in revenue and 78 independently operated locations in 10 states.
The operation has the ability to be scaled up, Buffett said.
The transaction is subject to getting approvals from the major auto manufacturers and regulators. It’s expected to be completed in the first quarter of next year.

http://www.msn.com/en-us/news/money/warren-buffett-gets-into-auto-dealers-in-big-way/ar-BB70grn

2

i find this quite interesting actually. the collision side i’ve been involved in for nearly a decade and it is also consolidating quickly. the dealership side is such a cash cow and so many of them are very poorly run and/or under monetized.

3

Are you referring to your personal collisions or business? :slight_smile:

4

I really dislike the consolidation happening in every industry. It hits hard in a city like Buffalo that stands to lose the HQ’s and administrative staff of the regional dealer groups to bigger cities. The efficiency is nice but the lack of competition and downsides for B tier cities like us are a real negative

5

It can be for the consumer economically speaking, but I hope to buy my tesla from amazon.com some day