Buffett says he'll buy more auto dealerships

NEW YORK — Successful investor Warren Buffett, who owns shares of General Motors and 78 auto dealerships in 10 states, says he'd like his Berkshire Hathaway to buy more stores.

"It can be a good and very profitable business," he said at an auto industry conference here today, ahead of the New York auto show, which displays models to the news media this week and is open to the public Friday through April 12.

"You'll find out over the next couple of years we're likely to make a few more acquisitions," he said.

The man whose auto empire Buffett bought, Larry Van Tuyl, now runs Buffett's Berkshire Hathaway Automotive. He told the panel, sponsored by J.D. Power and the National Automobile Dealers Association, that he expects to expand the dealer group beyond the current 10 states, but not outside the U.S., at least not soon.

Buffett was reminded that the auto business is cyclical and depends on credit, but he said his enthusiasm for the business would not diminish if the Federal Reserve bumps up rates.

Buffett: "If Janet Yellen came to up to me and whispered in my ear what she planned to do in the next two years, we'd still be in."

Repeating his long-voiced and successful philosophy, he said, "We buy for forever."

Buffett's thoughts on other matters:

•Electric-car maker Tesla is no threat to the conventional showroom dealerships, even though Tesla sells without using dealerships and is adamant to stay that way. "I don't see the volume there" to worry about Tesla, Buffett said.

Tesla electrics are expensive luxury models, and even when more models are added, the total sales would be low enough to be inconsequential to the conventional dealer network, he said.

•Self-driving cars aren't coming soon. He said he can't foresee even 2% of total sales in 2030 being self-drivers. "I think it's a long way off," but it will happen, he said.

Buffett, who also owns auto insurance company Geico, offered a grim example of the kinds of dilemmas that will have to be resolved for acceptance of self-driving cars. A self-driver is coming down the road and "3-year-old kid runs out in front. Another car's coming down the street" the other way. "Do you hit the kid or the other car? The computer makes the decision," he said.

But he also said that self-drivers could prove to be safer than human drivers, and that would be a plus for society — though not necessarily for his insurance business.