• Jan 6th 2009 at 8:31AM
  • 23


Everyone's broke. Gas prices keep rising and falling. America's three largest manufacturers of recreational vehicles are losing money like their pockets are full of holes. Perfect time to invest.

Well, it is if you're Warren Buffett, the richest man in the world, who has made an art out of "buy low, sell high." Through his holding company Berkshire Hathaway, the Texas-based legendary Omaha investor has invested some $40 million in Middlebury, Indiana's Coachmen Industries, makers of the Viking line of motor homes. The move is diametrically opposed to that of fellow American investor Kirk Kerkorian, who is rapidly divesting from America's automakers. Prospects in the RV market hardly look any better than Detroit's – projections place sales next year at their lowest in 18 years – but sooner or later, they'll recuperate. You can bank on that...Warren Buffett certainly is.

[Source: Edmunds Auto Observer | Image: Alex Wong/Getty]


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    • 1 Second Ago
  • 23 Comments
      • 6 Years Ago
      A lot of major RV and travel trailer makers have gone under in the past year, like Pilgrim International, in part due to the bad economy and in part due to the formaldehyde scandal with toxic FEMA trailers. Sounds like this cash infusion will help Coachmen scoop up market share and be in prime position for soon-to-be retirees.
      • 6 Years Ago
      I'm not sure the retirees of late will be looking at spending money on luxuries like RV's when their pensions are worth half of what they had anticipated. I know that if my pension or savings was halved, I'd probably keep working until something turned around, and might consider my future sans a recreational vehicle. But Buffett is a self-made billionaire and I'm not, so he must know something about this stuff. Kerkorian is just a putz.
      • 6 Years Ago
      This isn't news? He's at the age where one is bound to buy a RV.
        • 6 Years Ago
        Buffett: "I liked the motorhome so much, I bought the company!"
      • 6 Years Ago
      Warren Buffett is from Omaha Nebraska, not Texas as the article mentions. He is commonly referred to as the "Oracle of Omaha."
      • 6 Years Ago
      Should I say hes from Omaha... oh wait.


      P.S No one cares where hes from.
        • 6 Years Ago
        He;s a vulture!
        • 6 Years Ago
        Investors with A and B shares do. The annual meeting is actually very entertaining and it is held in Omaha every year. Also, I beleive the resedents of Omaha do not like to be ommited. Furthermore, just for the sake of journalistic integrity, it is good to get the facts correct.
        • 6 Years Ago
        It was a joke, meant to be light hearted. For more, please reference:

        http://dictionary.reference.com/browse/joke
        • 6 Years Ago
        exactly
      • 6 Years Ago
      Spending $40M for the Oracle is comparable to most people putting $20 on lottery tickets.
      • 6 Years Ago
      Coachmen also makes pre-fab homes (not to be confused with house trailers). He's betting that the first sector of the housing market to rebound will be the middle-bottom, not the top.
      • 6 Years Ago
      Go AMISH (and Menonites) !!!
      • 6 Years Ago
      Buffett is an extremely shrewd investor. If I had money, I would do exactly as he does...albeit on a much smaller scale. Unlike short-term, knee-jerk thinkers like Kerkorian, Buffett knows the economy won't stay down forever and is in this for the long haul.
      • 6 Years Ago
      Texas based investor? I guess they just call Buffet the Oracle of Omaha because it rhymes?
        • 6 Years Ago
        consonance
        • 6 Years Ago
        It's alliteration.
        • 6 Years Ago
        "Oracle of Omaha" doesn't rhyme.
      • 6 Years Ago
      Actually, if you looked at 'manufactured' housing you would be impressed. We recently did and were blown away about the quality and the low price versus the price of a 'regular' home. Warren, as usual, is on to something. The competition in the RV business has been decimated. Only the good brands are left and they are struggling.

      We have an RV. They are a terrible housing option unless you buy a really cheap one and have a place to put it. Insurance, taxes, storage, camping spots, and upkeep are high. The big killer financially though is deprecation. A new RV depreciates by at least 10% a year for the first 5 years. It is way cheaper to stay at an inexpensive hotel when you travel than to buy and use an RV.

      You can buy used RVs cheap now. Everyone is unloading theirs. Herd mentality. We will take off in April in our RV for a 14,000 mile Around the US Tour and enjoy every minute of it. We live in a beautiful country with wonderful people. See you on the road.
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