NEWS RELEASES
Texas Loophole Lets Warren Buffett Keep Selling Cars, Making RVs
Editor's Note: This news item was retrieved and first published through Austin-American Statesman's website.
The Statesman, a news outlet in Austin, TX, reports that Texas governor Greg Abbott has signed into law a loophole that will allow Warren Buffett’s holding company, Berkshire Hathaway, to legally operate the two dozen car dealerships it owns in Texas while continuing to own RV manufacturers in Indiana. In 2005, Berkshire Hathaway purchased Forest River, later also acquiring Rance Aluminum Fabrication and assets of Coachmen RV in Indiana. The company entered the Texas dealership business in 2015, when it paid $4.1 billion for the privately held Van Tuyl Group, renaming it Berkshire Hathaway Automotive. Texas state law prohibits motor vehicle manufacturers from owning stakes in dealerships, even if the vehicles aren’t of the same type, spurring action against Berkshire Hathaway as well as Tesla and Cummins in recent months.
The new law signed by Abbott only prohibits manufacturers from owning stakes in dealerships that sell the same vehicles they produce. Disputing charges that the bill is a carve-out for Buffett, legislators say it will benefit any company that finds itself in the same position. The Tesla and Cummins controversies however will be unaffected by the new legislation.
For additional information, read the story in The Statesman.