Berkshire Hathaway Inc chairman Warren Buffett said the company plans to buy more auto dealerships, regardless of the interest-rate outlook, in part because the price of entry is reasonably predictable.
If US Federal Reserve Chair “Janet Yellen came up and whispered into my ear what she was going to do for the next two years, it wouldn’t make a difference what we’d do,” he said on Tuesday in New York at the 2015 Automotive Forum held by J.D. Power and the National Automobile Dealers Association. “We don’t want to get out of the game based on what we think somebody might do.”
Buffett, who has said auto sales have rebounded faster than he expected, this month completed the purchase of the Van Tuyl Group, the largest closely held US car-dealership group. The billionaire wrote in his annual letter to shareholders that Berkshire plans to build its vehicle-retailing business with more acquisitions.
Consumers in the US bought about 16.5 million cars and light trucks last year, according to researcher Autodata Corp, the most since 2006. Annual auto sales are on track to exceed 16 million for the second year in a row, according to data compiled by Bloomberg.
With a healthy auto industry, dealerships remain an attractive investment with well-understood economics.
“The prices are fairly well established in the industry,” Buffett said. “You’re not talking biotech or something you can dream of this or that. You can look at the operation and see what they’re doing and see what their competition is. You can guess within 5 to 10 percent what the eventual price is going to be when you’re looking at any dealership, whether we make the deal or not.”
Separately, Buffett said in an interview with CNBC on Tuesday that the eurozone could withstand Greece’s departure from the currency union.
“If it turns out the Greeks leave, that may not be a bad thing for the euro,” Buffett said. “If everybody learns that the rules mean something and if they come to general agreement about fiscal policy among members, or something of the sort, that they mean business, that could be a good thing.”
Europe’s most-indebted state is locked in negotiations with eurozone countries and the IMF over the terms of its 240 billion euro (US$257.5 billion) rescue. The standoff, which has left Greece dependent upon European Central Bank loans, risks leading to a default within weeks and its potential exit from the eurozone.
Buffett said that over time, the countries in the eurozone would need to better coordinate their labor laws, fiscal deficits and general management of their economies.
“It can’t continue with people going in dramatically different directions,” Buffett said. “The Germans are not going to fund the Greeks forever.”
The domestic unit of the Chinese-owned, Dutch-headquartered chipmaker Nexperia BV will soon be able to produce semiconductors locally within China, according to two company sources. Nexperia is at the center of a global tug-of-war over critical semiconductor technology, with a Dutch court in February ordering a probe into alleged mismanagement at the company. The geopolitical tussle has disrupted supply chains, with some carmakers reportedly forced to cut production due to chip shortages. Local production would allow Nexperia’s domestic arm, Nexperia Semiconductors (China) Ltd (安世半導體中國), to bypass restrictions in place since October on the supply of silicon wafers — etched with tiny components to
Singapore-based ride-hailing and delivery giant Grab Holdings Ltd has applied for regulatory approval to acquire the Taiwan operations of Germany-based Delivery Hero SE's Foodpanda in a deal valued at about US$600 million. Grab submitted the filing to the Fair Trade Commission on Friday last week, with the transaction subject to regulatory review and approval, the company said in a statement yesterday. Its independent governance structure would help foster a healthy and competitive market in Taiwan if the deal is approved, Grab said. Grab, which is listed on the NASDAQ, said in the filing that US-based Uber Technologies Inc holds about 13 percent of
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday received government approval to deploy its advanced 3-nanometer (3nm) process at its second fab currently under construction in Japan, the Ministry of Economic Affairs said in a news release. The ministry green-lit the plan for the facility in Kumamoto, which is scheduled to start installing equipment and come online in 2028 with a monthly production capacity of 15,000 12-inch wafers, the ministry said. The Department of Investment Review in June 2024 authorized a US$5.26 billion investment for the facility, slated to manufacture 6- to 12nm chips, significantly less advanced than 3nm process. At a meeting with
Taiwan’s food delivery market could undergo a major shift if Singapore-based Grab Holdings Ltd completes its planned acquisition of Delivery Hero SE’s Foodpanda business in Taiwan, industry experts said. Grab on Monday last week announced it would acquire Foodpanda’s Taiwan operations for US$600 million. The deal is expected to be finalized in the second half of this year, with Grab aiming to complete user migration to its platform by the first half of next year. A duopoly between Uber Eats and Foodpanda dominates Taiwan’s delivery market, a structure that has remained intact since the Fair Trade Commission (FTC) blocked Uber Technologies Inc’s
RSS