Charlie Munger done good when he pitched Warren to buy BYD.
From The Telegraph, September 22:
Berkshire Hathaway’s sell-off leaves car giant BYD’s shares down 29pc from May high
Warren Buffett’s investment giant has sold off its entire stake in BYD as investors lose faith in China’s Tesla rival.
Berkshire Hathaway revealed in its latest filings that its shareholding in BYD fell to zero in the second quarter, down from $415m (£308m) at the end of last year.
Mr Buffett’s exit led to the carmaker’s shares falling by 3.4pc in Hong Kong on Monday, fuelling a £31bn drop in BYD’s valuation since May.
Nicknamed the Oracle of Omaha, Mr Buffett first bought shares in BYD in September 2008 after the company was recommended by Charlie Munger, his long-term business partner, who died in 2023.
The company’s share price has since risen by more than 4,500pc, although it has been losing steam over the past six months.
Mr Buffett has been selling down his stake since 2022, a move that other Western investors have followed in recent months.
The carmaker’s top five stakeholders – Vanguard, BlackRock, JP Morgan, Fidelity and Citigroup – sold a combined 222m Hong Kong-listed shares in the second quarter, worth around £2.6bn....
....MUCH MORE
Over the last few months:"China's top leaders vow crackdown on price wars as deflation risks mount"
...As pointed out introducing June 24's Dear Europe: "China’s BYD expands car-carrier fleet to bolster EV exports amid furious domestic competition"it was the auto sector that caught our attention most recently:BYD doesn't sell in the U.S. and there aren't very many markets that can absorb the overproduction.
And the government does not want the price war for the domestic market to get any more cut throat:
May 28 - "Chinese EV Stocks Tumble After BYD Slashes Prices Up to 35%"
June 3 - Chinese Government Warns Against Electric Vehicle Price War
But since the covid reopening it has been apparent what is going on in the wider economy...
"BYD’s shares sharply lower after China EV maker’s earnings miss"
"BYD’s $45 Billion Stock Wipeout Raises Doubts on China Outlook"
And on Charlie+BYD:
April 2009 - Better Batteries: General Electric, A123 and the Power Grid. Plus Warren Buffett Does a Drive-by (Charlie too!)
Here's Fortune on Mr. Buffett and BYD:
Warren Buffett takes charge
Warren Buffett hasn't just seen the car of the future, he's sitting in the driver's seat. Why he's banking on an obscure Chinese electric car company and a CEO who - no joke - drinks his own battery fluid.
Warren Buffett with BYD's E6.
The car came straight to Omaha from the Detroit auto show.
Warren Buffett is famous for his rules of investing: When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is usually the reputation of the business that remains intact. You should invest in a business that even a fool can run, because someday a fool will. And perhaps most famously, Never invest in a business you cannot understand.So when Buffett's friend and longtime partner in Berkshire Hathaway (BRKB), Charlie Munger, suggested early last year that they invest in BYD, an obscure Chinese battery, mobile phone, and electric car company, one might have predicted Buffett would cite rule No. 3 above. He is, after all, a man who shunned the booming U.S. tech industry during the 1990s.
But Buffett, who is 78, was intrigued by Munger's description of the entrepreneur behind BYD, a man named Wang Chuan-Fu, whom he had met through a mutual friend. "This guy," Munger tells Fortune, "is a combination of Thomas Edison and Jack Welch - something like Edison in solving technical problems, and something like Welch in getting done what he needs to do. I have never seen anything like it.">>>MORE
May 2009 - Here's the Story on Berkshire's Munger (BRK.A)
....The two men, Mr. Munger, 85 years old, and Mr. Buffett, 78, speak frequently and confer about most deals, but there are differences. Mr. Munger is laconic; Mr. Buffett loquacious. Mr. Munger leans Republican; Mr. Buffett tilts Democratic. Mr. Munger will pay hefty price tags for businesses; Mr. Buffett likes safe, dirt-cheap stocks.
Mr. Munger's views have pushed Berkshire into some surprising directions. Several years ago, Mr. Munger learned of an obscure Chinese maker of batteries and automobiles called BYD Inc., which hopes to create a cheap, functional electric car....MORE
August 2009 - China's BYD says Buffett wants to raise stake (BRK.A: 1211.HK)
[this comment did not please Buffet or Munger - Don't be tellin' people to go frontrun our buying]
May 2023 - Berkshire Hathaway Cut Stake In China's BYD Because The Don't Want To Compete Against Elon Musk (TSLA)
January 2024 - "China could be on track to dominate the world’s EV market, even if not in the U.S."
Elon Musk, who seems to have some insight into the industry, says there will be 10 surviving manufacturers, 9 of them Chinese....*****....In the case of BYD, its manufacturing prowess had long impressed Berkshire Hathaway vice chairman Charlie Munger, who passed away this week. While Berkshire generally steers clear of the auto industry—it declined to invest in Tesla—Munger led an enormously successful investment in BYD. He called the carmaker’s founder and CEO Wang Chuanfu a “natural engineer,” adding that “the guy at BYD is better at actually making things than Elon is.”....
And many, many more. It was an important story and we just happened to bookend it.
