Buffett is bullish on US auto industry


WARREN Buffett's company is apparently bullish on the US auto industry.

His company, Berkshire Hathaway Inc took a new stake of 10 million shares in General Motors Co in the first quarter. The investment comes as the Detroit automaker continues to rebound from bankruptcy three years ago. It posted a first-quarter net income of US$1 billion, fueled by US vehicle sales.

Buffett drives a GM-made Cadillac DTS sedan, so the investment could be a further sign of his preference among US automakers. Berkshire is not invested in Ford Motor Co or Chrysler, which is majority owned by Fiat SpA. But the purchase of the GM stake, worth about US$214 million as of Tuesday, could also have been made by one of Berkshire's other investment managers.

Omaha-based Berkshire also revealed in a regulatory filing on Tuesday that it boosted its stake in Wal-Mart by almost 8 million shares to 46.7 million shares.

The first-quarter move to expand Berkshire's stake in Wal-Mart came before The New York Times published a report detailing allegations that Wal-Mart executives used bribes to speed the retailer's expansion in Mexico.

Buffett told Berkshire shareholders earlier this month, however, that the scandal didn't change his view on Wal-Mart's value or its earning power.

Berkshire officials don't comment on the quarterly investment reports.



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