Warren Buffett’s bet on a Chinese electric car company pays off big

BYD is selling more cars than Tesla. That’s good for the planet.

In the fall of 2008, Berkshire Hathaway, the holding company led by Warren Buffett, invested about $232 million in BYD, which was then an obscure Chinese electric car company based in Shenzen, not far from Hong Kong. FORTUNE magazine assigned me to write about BYD and Buffett, and my story ran on the cover in April 2009.

The investment did just fine for a decade — by 2018, Berkshire’s stake was worth about $1.6 billion — and then it exploded, along with BYD’s sales. At its closing price of HK$306.80 on Monday [July 11], Berkshire’s 20.49% stake in the Hong Kong shares of BYD was worth roughly $9 billion, according to Bloomberg.

Wow.

This is welcome news for the planet, as well as for Berkshire shareholders. BYD sold 641,350 vehicles in the first six months of 2022, three times as many as it sold during the first half of 2021, according to InsideEVs. About half were fully electric, and half were plug-in hybrids. Tesla sold 564,743 vehicles, all of them fully electric. BYD is also the world’s second-biggest producer of electric vehicle batteries.

Two things strike me about the BYD story.