Warren Buffett — no relation to Jimmy — is a lot of things: investor extraordinaire, railroad magnate, newspaper mogul, hip-hop enthusiast et al. As of last Thursday, however, he picked up a new title: master auto dealer.
Bloomberg reports Buffett’s Berkshire Hathaway purchased Arizona-based Van Tuyl Group, the largest privately owned auto dealership group in the United States, for an undisclosed sum. Namesake Larry Van Tuyl will continue to run the show, especially with Buffett’s plans to scale operations significantly.
The purchase is a bet on the consolidation of the dealership industry overall, as a handful of groups — like AutoNation, Group 1 and Penske — come into more dealerships; Van Tuyl operates 78 in 10 states, including Arizona, Texas and Nebraska.
Once the paperwork is sorted in Q1 2015, the group will be renamed Berkshire Hathaway Automotive. The group has over $8 billion in revenue.
“The purchase is a bet on the consolidation of the dealership industry overall.” This guy started out in insurance IIRC, its a safe bet he’s probably right.
If the dealerships consolidate and continue to become bigger and stronger (due to large infusions of cash at the ready) then one can only assume this will be an even more unwelcoming environment for Tesla’s business model.
Banks, insurance, farming, restaurants, stores, and car dealers. One gets the feeling that soon there will only be 10 companies controlling everything.
That is correct. He owns the Berkshire-Hathaway conglomerate which includes insurance and reinsurance companies.
> renamed Berkshire Hathaway Automotive
This is the mistake. With the use of the same name for a housing brokerage, and as I hear, other acquisitions, the general public will become aware of exactly how much this one guy controls resulting in political problems. Keeping the names of the purchased companies lets BH fly under the radar.
Berkshire Hathaway Auto Insurance
Berkshire Hathaway Chocolate
Berkshire Hathaway Ice Cream and Deep-Fried Stuff
Berkshire Hathaway Railways
Berkshire Hathaway Modular Homes
Berkshire Hathaway Condiments
Berkshire Hathaway Footware
More here: http://www.berkshirehathaway.com/subs/sublinks.html
It seems that Berkshire Hathaway keeps it’s name off already established brands (GEICO, Dairy Queen, Sees) but once public awareness is piqued, it’s hard to un-pique; plus, the people making the brand decisions may continue to use the Berkshire Hathaway to rename established brands at BH becomes more common.
I honestly had no idea how much was actually under Berkshire Hathaway. I knew that they bought out a well known real estate a few years back but that was it.
“Berkshire Hathaway Automotive” won’t be a consumer brand, though — Van Tuyl has kept the names of the dealerships it’s acquired. Including, improbably, Reliable Lexus in Springfield, MO.
I’d imagine he would use GEICO dealership group instead to promote the brands of each other.
Caption:
Jay-Z “Ey where’s Bey at?”
Buffett “Look at this tie. This is Burberry. Can’t compete with this ish!”
“This is Burberry”
I don’t get the attraction, I prefer Brooks Brothers or Zegna.
Neither of those has a flash, recognizable plaid!
Jimmy Buffet and Warren Buffet are cousins.
About that: http://archive.fortune.com/magazines/fortune/fortune_archive/2007/06/11/100060549/index.htm?section=magazines_fortune