He’s known as one of the world’s smartest investors – and has the billions to prove it – so when Warren Buffett makes a change, people notice.
Which is why Buffett’s decision to sell his entire stake in BYD, the rising Chinese car maker, is making big news this week. Buffett’s investment company, Berkshire Hathaway, was one of the early major investors in BYD, taking a 10 per cent stake in 2008 for a reported US$230 million.
But amid the USA’s ban on Chinese cars and concerns from some circles that the electric vehicle market is getting saturated and sales are slowing, it appears Buffett has decided the time is right to cash out.
Berkshire Hathaway has been selling its BYD shares since 2022, but recent filings indicate that the company now has completely sold out.
While there is no suggestion that BYD is in financial trouble, the move is a blow to the car maker’s image, particularly outside of the Chinese industry, as Buffett was seen as a strong advocate for the company’s long-term success.
However, BYD sales in China have been in decline in recent months and its quarterly profit fell for the first time in more than three years.
Buffett is an investor by trade, and his BYD shares are now worth more than 20 times what he paid for them in 2008, meaning he may have decided to cash out while he was still guaranteed a healthy profit. His 17 years of investment in BYD will likely have netted him approximately US$10 billion in profit.
BYD is still rapidly growing in Australia, with the brand’s sales up more than 145 per cent, year-to-date to August. The Shark 6 plug-in hybrid ute is leading that growth and has already become one of the best-selling dual-cab pickups in the country.
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