The ink is drying on Warren Buffet’s finalized deal to buy the nation’s fifth-largest chain of automotive dealers. He’s just acquired the Van Tuyl Group, which consists of 81 dealerships and more than 100 franchises in the South and the Midwest. While the enterprise will be renamed Berkshire Hathaway Automotive, current Van Tuyl leadership will remain in place.
“This is the beginning of a journey that will have no end,” Buffett said in a statement. “Cecil and LarryVan Tuyl have given us the ideal platform with which to build an auto dealership business that will be thriving and growing 50 and 100 years from now.”
Buffett’s plan to buy the group first came to light in October 2014. The automotive group, the largest private dealer group in the U.S., brings in some $9 billion in annual revenue. It has locations in Arizona, California, Florida, Georgia, Illinois, Indiana, Missouri, New Mexico, Texas and, of course, Nebraska. The new Berkshire Hathaway Automotive is headquartered in Dallas. Jeffrey Rachor, formerly Van Tuyl Group’s president, has been named the company’s CEO.
“Our partners and 10,000 plus associates are extremely proud and excited about the bright future as Berkshire Hathaway Automotive,” Rachor said in a release. “We are all grateful that Mr. Van Tuyl found the ideal buyer to preserve the Van Tuyl business model and our unique entrepreneurial culture.”
Last Fall, Buffett also told CNBC that he planned to buy even more auto dealers. He already owns Geico and has his fingers in chinese electric car company BYD. Berkshire also owns BNSF Railway and private plane company NetJets.
March 10, 2015 – Berkshire Hathaway Inc. (NYSE:BRK.A and BRK.B) has completed its acquisition of the Van Tuyl Group, the largest privately held dealership group in the United States. This historic transaction, which was announced in October, is the largest in the retail automotive industry’s history.
The company has been renamed Berkshire Hathaway Automotive and is headquartered in Dallas, Texas. Larry Van Tuyl will serve as Chairman of the Board of the new company. Jeffrey C. Rachor, formerly Van Tuyl Group’s President, will be Chief Executive Officer of the enterprise. The cornerstone of the Van Tuyl business model is local entrepreneurial dealership managers with minority ownership stakes. Every Managing Partner has enthusiastically committed to stay on with Berkshire Hathaway Automotive and they will remain equity partners in their respective dealerships.
“This is the beginning of a journey that will have no end,” stated Mr. Buffett. “Cecil and Larry have given us the ideal platform with which to build an auto dealership business that will be thriving and growing 50 and 100 years from now. The fun has just started.”
“Mr. Buffett and I made this deal on a handshake and it is no surprise that completing the transaction went smoothly and according to plan,” stated Mr. Van Tuyl. “Berkshire Hathaway’s acquisition of the Van Tuyl Group has been embraced by all internal and external stakeholders. I want to take this opportunity to thank our manufacturer partners for their universal support and approval of the transfer of their franchises. Warren Buffett and Berkshire Hathaway are the perfect owners of this business. My father Cecil, the original founder of the Van Tuyl Group, would be very proud today.”
Mr. Rachor added, “Our partners and 10,000 plus associates are extremely proud and excited about the bright future as Berkshire Hathaway Automotive. We are all grateful that Mr. Van Tuyl found the ideal buyer to preserve the Van Tuyl business model and our unique entrepreneurial culture. The organization will continue to execute our simple strategy of operational excellence and sensible growth through acquisitions.”