Berkshire Hathaway-backed BYD has announced the expansion of North American operations, with the opening of a service center in Indianapolis, Indiana to serve its Midwest customers.
The center will provide quick access to parts, care, and expertise for BYD buses and trucks. Customers near the service center include Indianapolis’ transit agency IndyGo, the Kansas City International Airport, and the City of Columbia, Missouri’s transit agency Go COMO. Customers in the region operate BYD buses ranging in size from the 30-foot K7M to 60-foot K11M, BYD’s largest transit bus model. The center will also serve BYD truck customers as that markets grows.
The service center has three service bays, a parts warehouse, and all the equipment necessary to handle customer after-sales care. The center, staffed by a team of eight employees, is open from 7 a.m. to 3:30 p.m. Monday through Friday.
“BYD wants to make sure our customers get quick, expert care,” said Patrick Duan, BYD Senior Vice President. “BYD is committed to top-quality customer service. We are creating a network of service centers to bring BYD and its customers closer together.”
BYD and Berkshire Hathaway
In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares for $232 million. It’s an investment that has paid off handsomely. Berkshire’s original investment of $232 million had grown in value to $5.897 billion as of December 31, 2020.
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a 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.
Time and investing are inextricably linked, as the time it takes for an investment directly effects your rate of return. And, Warren Buffett also sees time as both friend and foe for companies themselves.
“Time is the enemy of the poor business, and it’s the friend of the great business,” Warren Buffett said at the 1998 Berkshire Hathaway Annual Meeting. “I mean if you have a business that’s earning 20 or 25 percent on equity, and it does that for a long time, time is your friend. But time is your enemy if you have your money in a low-return business. And you may be lucky enough to pick the exact moment when it gets taken over by someone else. But we like to think when we buy a stock we’re going to own it for a very long time, and therefore we have to stay away from businesses that have low returns on equity.”
Buffett’s full explanation on companies with poor returns on equity
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.
Berkshire Hathaway’s BNSF Railway suffered a major fire at its Alliance Intermodal Facility in Alliance, Nebraska on Sunday, April 11. The fire was in the roof of the structure, but the majority of the damage was caused by smoke and the water used to extinguish the blaze.
The damage was initially estimated at $3 million, including $2 million in damage to electronic equipment.
There were no injuries.
“We did have a structural fire; all our employees were safely evacuated, thankfully,” Amy Casas, senior director of external communications with BNSF Railway, said. “The local fire department managed to extinguish the fire within a few hours. We currently have a temporary worksite set up for any employees who worked out of that building while we conduct inspections and any necessary remediation work to the facility. The cause of the fire is currently under investigation.”
Berkshire Hathaway has been snakebit with fires recently, with a major fire destroying a Lubrizol plant in Rouen, France in September 2019. Last month a fire destroyed a Forest River RV plant in Goshen, Indiana, and on April 7, there was a fire at a Johns Manville plant in Winslow Township, New Jersey.
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a 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.
Berkshire Hathaway’s Johns Manville had a 7-alarm fire on April 7-8 at its plant located in Winslow Township, New Jersey.
The fire was initially extinguished, but it rekindled the following evening, before being fully subdued.
No injuries were reported, and the extent of the damage is not known. The cause of the fire is currently under investigation.
Johns Manville manufactures insulation and building materials.
“Nearly thirty (30) hours after the first alarm was transmitted, firefighters remain on the scene of the Johns Manville Fire. Seven alarms were ultimately struck for this fire yesterday,” the Camden County IAFF Local 3249 posted on their Facebook page. “As part of an organized incident management plan, fire companies throughout the region are being rotated in to the scene for defined operational periods to prevent safety hazards due to fatigue from overwork. Other companies are also covering for units committed to the scene in order to ensure adequate coverage is maintained for any other emergencies that may occur within the region while this extended operation continues.”
Berkshire Hathaway has been snakebit with fires recently, with a major fire destroying a Lubrizol plant in Rouen, France in September 2019, and just last month a fire destroyed a Forest River RV plant in Goshen, Indiana.
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a 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.
Warren Buffett reminds investors that there is no special award for the degree of difficulty of an investing strategy. And, according to Buffett, in the end it is the execution of an investing strategy that is the most important thing.
“This is not like Olympic diving. In Olympic diving, you know, they have a degree of difficulty factor. And if you can do some very difficult dive, the payoff is greater if you do it well than if you do some very simple dive. That’s not true in investments,” Warren Buffett said at the 1998 Berkshire Hathaway Annual Meeting. “You get paid just as well for the most simple dive, as long as you execute it all right. And there’s no reason to try those three-and-a-halves when you get paid just as well for just diving off the side of the pool and going in cleanly. So we look for one-foot bars to step over rather than seven-foot or eight-foot bars to try and set some Olympic record by jumping over. And it’s very nice, because you get paid just as well for the one-foot bars.”
Buffett’s full explanation on degree of difficulty versus reward in investing
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.
Berkshire Hathaway’s JAX LNG is expanding its natural gas production and storage facility at the Jacksonville Port Authority (JAXPORT) in Jacksonville, Florida.
JAX LNG, a joint-venture between Berkshire Hathaway’s Pivotal LNG and its partner NorthStar HoldCo Energy, LLC, are expanding JAX LNG and building a 5,400 cubic meter LNG articulated tug barge unit, the Clean Canaveral.
Pivotal LNG, a subsidiary of BHE GT&S, and NorthStar, are tripling the facility’s production capability to 360,000 gallons per day and doubling LNG storage capacity to four million gallons.
“With the excellent support we have from our construction contractors, we are excited to commence our expanded operations, particularly for our new anchor customer beginning its LNG-powered voyages in 2022,” said Tim Casey Senior Vice President – LNG for NorthStar. “The expansion of JAX LNG and the construction of the Clean Canaveral will allow us to supply our existing customers, take on new customers and deliver LNG to points anywhere from Savannah, Georgia to Miami, Florida. The market for LNG as a bunker fuel is accelerating as more LNG powered ships are put into service. JAX LNG and Polaris New Energy are prepared to support the shipping industry’s important effort to reduce its carbon footprint by using LNG, an environmentally friendly fuel that can reduce greenhouse gas emissions by over 20 percent.”
The JAX LNG facility has been in service since the fourth quarter of 2018 and, through its integrated LNG marine loading dock, JAX LNG has safely completed more than 150 deliveries of LNG to the Clean Jacksonville bunker barge.
JAX LNG has also been servicing additional customers in the shipping, over-the-road trucking and aerospace segments.
About JAX LNG
JAX LNG, LLC is a joint venture between Berkshire Hathaway’s Pivotal LNG, a subsidiary of BHE GT&S, and NorthStar Midstream, operating a 120,000 gallon per day LNG plant with 2 million gallons of storage in Jacksonville, FL. The LNG facility was constructed to bring liquefied natural gas to the southeast U.S. and Puerto Rico.
Berkshire Hathaway acquired its stake in the facility as part of its $9.7 billion acquisition of Dominion Energy’s natural gas transmission and storage business in 2020.
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a 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.
When it comes to discussing a company’s financial performance, EBITDA (earnings before interest, taxes, depreciation, and amortization), has become such a common reference point that you would think that everyone embraces its utility. However, neither Warren Buffett, nor Charlie Munger, who famously said “I think that, every time you see the word EBITDA, you should substitute the words ‘bullshit earnings,’” have much good to say about the acronym. Buffett has even gone so far as to call its widespread use a “mass delusion.”
“In respect to EBITDA, depreciation is an expense, and it’s the worst kind of an expense,” Warren Buffett said at the 2017 Berkshire Hathaway Annual Meeting. “You know, we love to talk about float. And float is where we get the money first and we have the expense later. Depreciation is where you spend the money first, you know, and, then, record the expense later. And it’s reverse float. And it’s not a good thing. And to have that enter into a multiple, it’s much better to buy a business that has, everything else being equal, has no depreciation because it has, essentially, no investment and fixed assets that makes X, than it is to buy a company where there’s a lot of depreciation in getting to X. . . . And, of course, it’s in the interests of Wall Street, enormously, to focus on something called EBITDA because it results in higher borrowing power, higher valuations, and all of that sort of thing. So it’s become very popular in the last 20 years. . . . It’s a very misleading statistic that can be used in very pernicious ways.”
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.
Berkshire Hathaway’s auto insurer, GEICO, has acquired Republic Group No. Two Company, a Missouri corporation formed in 1965.The transaction took place in January 2021.
GEICO acquired 100% of the voting shares of Republic Group No. Two Company and control of Southern County Mutual Insurance Co., a property and casualty insurer based in Dallas, Texas.
GEICO management has indicated its intention to reinsure Southern County 100% to an affiliate; however, the reinsurance agreement has not yet been put into effect.
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 n
Berkshire Hathaway-backed BYD has received a big boost for its proposed SkyRail monorail for Los Angeles.
In 2019, BYD submitted its SkyRail proposal as one of LA Metro’s four refined concepts for the Sepulveda Transit Corridor. Of the four proposals, BYD’s SkyRail monorail and Sepulveda Transit Corridor Partners – Bechtel’s heavy rail have been selected to receive over $60 million in funding each to move to the next stage.
The goal is to create a high-capacity transit line between the San Fernando Valley and the Westside through the Sepulveda Pass that would move some 100,000 people a day off the I-405 Freeway, which is already ranked as one of the most traveled urban highways in the nation.
LA SkyRail Express (LASRE) – a team of leading transportation, construction, engineering, finance, and technology companies including John Laing, Skanska, BYD, Gensler, HDR, ACI and Innova – has been awarded a contract by the Los Angeles County Metropolitan Transportation Authority’s (Metro) for the Sepulveda Transit Corridor Project PDA RFP.
With the Metro Board’s approval, Metro and LASRE will enter into a contract for pre-development services in an amount not to exceed $63,605,132. The award of this contract, along with a similar one for Sepulveda Transit Corridor Partners – Bechtel’s heavy-rail option, will allow the project’s environmental process to begin, which will include extensive community conversations over the next one-to-two years to help shape the final alignment, technology and station locations.
If ultimately selected as Metro’s preferred team and technology, LASRE intends to link the historically underserved San Fernando Valley to the Westside and LAX transportation and education hubs, including options to connect directly with UCLA, with innovative, high-speed, high-capacity service.
“We are delighted to have reached this significant final stage of the Sepulveda Transit Corridor Project selection process. The LA SkyRail Express proposal from the Valley to the Westside and the Alternative Proposal for the entire corridor to LAX, including the direct connect alternative that we developed through an 18-month workshop process with UCLA, are estimated to fit well within the Measure M budget, with LA SkyRail Express costing a fraction of the subway alternative,” said Anthony Phillips, Co-Head of PPP and Greenfield Projects at infrastructure investor John Laing.
“SkyRail is the advanced, high speed, high-capacity monorail system that incorporates advances that have been made in monorail technology through urban applications in many of the world’s largest cities over the past 60 years. SkyRail is designed to maximize safety and energy efficiency. Equally as important, LA SkyRail Express can help alleviate the chronic congestion Valley and Westside residents have faced for decades. We are hopeful about progressing to the next stage of the bid process and proud to play our part supporting one of the most consequential infrastructure projects in Los Angeles’s history. The LA SkyRail Express team looks forward to the next stage of the selection process with great optimism and integrity.”
LASRE’s vision is to develop a transformative link in LA County, increasing mobility and transportation accessibility for those with few options. The natural barrier created by the Santa Monica Mountains has long caused some of the worst auto congestion in the country. LASRE’s solution will provide a technically and financially viable alternative to the I-405, providing safe, reliable, efficient and sustainable transportation between the San Fernando Valley and Westside within Metro’s allotted budget.
Our mission is to provide direct, efficient connections throughout the corridor, not only to Metro’s bus and transit network, but also to major mixed-use centers along the route, such as UCLA, the Westside, and the South Bay area surrounding LAX, as well as LAX itself.
“Addressing Los Angeles’ chronic traffic congestion will take an innovative solution that will finally link the region’s existing east-west lines, and that’s exactly what the LA SkyRail Express team can deliver,” stated Denny Zane, executive director of Move LA. “Unlike other options, it won’t take decades for LASRE’s potentially transformative technology to connect the San Fernando Valley to the Westside and UCLA, and to LAX to create an integrated transportation system at far less cost, something our City desperately needs.”
In 2017, BYD launched its first commercial SkyRail line in Yinchuan, capital of Northwest China’s Ningxia Hui Autonomous Region. In April 2020, the company signed a deal to build a monorail for São Paulo, Brazil. The SkyRail will be for the Line 17 (Gold Line) project.
BYD and Berkshire Hathaway
In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares for $232 million. It’s an investment that has paid off handsomely. Berkshire’s original investment of $232 million had grown in value to $5.897 billion as of December 31, 2020.
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a 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.
When it comes to evaluating a company, you can’t rely on the reports Wall Street provides you, according to Warren Buffett. You have to do your own work, reading annual reports, including the annual reports of a company’s competitors.
“You can’t read Wall Street reports and get anything out of them,” Warren Buffett said at the 1996 Berkshire Hathaway Annual Meeting. “You have to do it yourself and get your arms around it. I don’t think we’ve ever gotten an idea, you know, in forty years from a Wall Street report. But, we’ve gotten a lot of ideas from annual reports.”
Buffett’s full explanation on evaluating a company
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.