Warren Buffett’s Berkshire Hathaway Exits BYD After 17 Years
Warren Buffett’s investment firm, Berkshire Hathaway, has completely divested its stake in the Chinese automaker BYD, marking the end of a 17-year investment that saw its value increase more than twentyfold. According to a filing from Berkshire’s energy subsidiary, the value of its BYD investment was recorded as zero as of the end of March 2024, a significant drop from $415 million at the end of the previous year.
The journey began in 2008 when Berkshire Hathaway invested $230 million for approximately 225 million shares, which represented a 10% stake in BYD at that time. Over the years, as BYD’s share price surged, Berkshire began selling portions of its holdings in 2022, realizing substantial gains from the investment.
In a statement on his official Weibo account, Li Yunfei, BYD’s general manager of branding and public relations, expressed gratitude to Berkshire for its “investment, help and companionship over the past 17 years.” He characterized the sale of the stake as a “normal” stock investment trade, suggesting that it was a strategic decision rather than a reaction to market pressures.
Berkshire Hathaway did not provide immediate comments regarding the exit from BYD on Monday. The news was first reported by CNBC on Sunday.
BYD Faces Challenges Amid Market Conditions
As BYD transitions without Buffett’s backing, it faces its own set of challenges. The automaker, which competes directly with Tesla, reported its first quarterly profit decline in over three years. This downturn follows the government’s crackdown on aggressive price competition in the electric vehicle market. Furthermore, BYD’s domestic sales, which account for nearly 80% of its global shipments, have now declined for four consecutive months as of August.
In light of these developments, BYD has adjusted its annual sales target, reducing it by as much as 16% to 4.6 million vehicles, as reported by Reuters. The company will need to navigate these challenges while establishing its path forward in a rapidly evolving automotive landscape.
