(BRK.A), (BRK.B)
The electric vehicle in China is on a quick path to move from a rarity to a substantial part of the transportation mix.
In a speech given at the World Economic Forum’s Annual Meeting of New Champions 2016 in the city of Tianjin, China, BYD’s CEO Wang Chuanfu stated that “the turning point for new energy vehicles has finally arrived.”
Wang noted that the production and sales of new energy vehicles exceeded 300,000 units in 2015, representing a three-fold growth year-on-year, and accounting for a 1.3% share of overall vehicle sales in China.
He pointed out that it took ten years to go from zero to the current 1%, but it may take only another five years to reach 10%.
Sales of new energy vehicles in China are projected to move up dramatically and are forecast to hit 30% by 2025.
In 2015, BYD became the number one seller of electric cars in the world. It was a dramatic rise for a company that only ranked seventh in 2014.
In April 2016, BYD achieved another major milestone, the production of its 10,000th pure electric bus.
BYD is thoroughly dominating the rapidly growing market for emissions free buses of all sizes.
BYD and Berkshire Hathaway
In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares, and today owns roughly 9.1% of the company.
It’s an investment that has paid off handsomely. Berkshire’s original investment of $230 million is now worth roughly $1.77 billion.
For More on BYD, read the Special Report: BYD, Berkshire’s Tesla.
© 2016 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.