Berkshire Hathaway Inc., the company that owns GEICO, BNSF railroad, and Dairy Queen, among others, has purchased Van Tuyl Group, which provides consulting service to the largest private dealership groups in the U.S., for an undisclosed amount.
Warren Buffett, chief executive of the conglomerate, told CNBC during an interview that he was getting in to the auto business because he believes that there are huge opportunities for market consolidation in the fragmented auto dealership business, and expects to add “a lot more” dealerships to the roster in the future.
Van Tuyl currently has 78 independently operated dealerships and more than 100 franchises in 10 states, with over $8 billion in revenue, according to the company’s website. The soon-to-be-named Berkshire Hathaway Automotive will continue to be led by Larry Van Tuyl, who will become Chairman, and Jeff Rachor, who will assume the role of chief executive, according to a press release.
The transaction is expected to be completed in the first quarter of 2015 and is subject to obtaining approvals from the major auto manufacturers as well as certain customary closing conditions, including various regulatory approvals.
