Buffett: Tesla doesn't threaten me

Warren Buffett's new auto dealership business isn't under any threat from Elon Musk or his Tesla (TSLA) distribution model, the billionaire said Tuesday.

Speaking to CNBC at a forum hosted by the National Automobile Dealers Association, J.D. Power and the New York International Auto Show, Buffett said he did not anticipate much of a threat from the electric car company's direct-to-consumer model because of Tesla's relatively small market.

"I would doubt if it picks up much steam," he said of the company's sales model. "What Tesla does with it, we'll find out. But I do not see the distribution system changing in any major way."

Berkshire Hathaway (BRK.A) Automotive Chairman Larry Van Tuyl agreed, saying at a panel that he did not see Tesla as much of a threat to the network of 81 dealerships that he oversees.

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"I don't see any serious volume potential there, and their pricing for what they build may be fine, but it's certainly at the upper end, so I just don't see it as a volume product," he said.

Buffett also dismissed the notion of an near-term takeover of self-driving cars, saying "I think it's a long way off and I don't think everybody will adopt it." The billionaire said that he would bet there is less than a 10 percent penetration rate for self-driving cars by 2030.

He did admit, however, that "if it's a safer way of driving, it's good for society and it's bad for our insurance business."

Buffett also revealed Tuesday that he has big plans for his newly acquired unit, and that it is already on the prowl for new deals. (Tweet This)

"I'd be very surprised if five years from now we aren't a whole lot bigger," he said.

Buffett acquired the Van Tuyl Group earlier this year, renaming the largest private chain of car dealers Berkshire Hathaway Automotive. Van Tuyl became the chairman of the unit when it was officially launched this month.

Van Tuyl told CNBC the group is largely looking at acquiring higher-volume U.S. targets that are reasonably priced.

"We like volume," he said later Tuesday at a panel, adding that the unit is also interested in acquiring real estate. He said the business is considering expanding out of its current 10 states, but will likely stay within the country.

Buffett said that any purchases will be made with a long-term outlook, so he is not worried about inflated prices from the strong car sales market this year.