It appears that Warren Buffett has given up on BYD, China’s biggest electric vehicle maker.
BYD U.S. shares tumbled 11% on Tuesday after Hong Kong’s Central Clearing and Settlement System reported a massive 225 million share rise in BYD shares from Citibank, Reuters reported.
That’s the exact number of BYD shares Buffett’s Berkshire Hathaway owned.
Berkshire did not respond to a request for comment and it may not be known whether Buffett sold the stake until the company’s next quarterly regulatory release, scheduled for mid-August. Berkshire Hathaway shares rose less than 1% on Tuesday.
But investors weren’t waiting to sell what they believed was bad news for BYD. Berkshire’s massive stake in the company represented 20.5% of the company’s outstanding shares.
BYD ranks second in EV sales in China and is hot on the heels of Tesla. BYD sold 69,544 electric vehicles in China last month, compared with 78,000 for Tesla.
China’s overall auto market slowed in the spring and the country’s sweeping lockdowns kept factory workers at home and potential buyers at bay.
Still, BYD continued to dominate. The company sold a record 106,000 new energy vehicles in April, more than half of which were fully electric.
The company’s sales increased by 300% between April 2021 and April 2022.
Analysts attributed BYD’s resilience in sales to its “integrated vertical supply chain.”
The business model made BYD less vulnerable to supply chain disruptions during lockdowns, while rivals had to reduce production because of shortages of chips and batteries.
The China market has started to grow again in recent months.
Even if its competitors gain momentum, BYD will benefit: The company reportedly has a deal to supply Tesla with battery technology soon.
BYD has been manufacturing lithium iron phosphate batteries “Blade Batteries” since 2020, for use in its own cars and for sale to other automakers.
Source: CNN Brasil
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