A Legacy of Belief: BYD's Appreciation for Visionary Investors
BYD Expresses Thanks as Berkshire Hathaway Concludes 17-Year Investment Journey
BYD Co. Ltd., a prominent Chinese vehicle manufacturer, recently conveyed its appreciation to Warren Buffett and Charlie Munger for their unwavering confidence in the firm. This message arrived concurrently with the announcement that Berkshire Hathaway Inc. had fully divested its shares in BYD earlier in the year, marking the conclusion of an investment relationship that had flourished for 17 years.
Munger's Early Endorsement and BYD's Confirmation of Investment Exit
According to reports from CNBC, Li Yunfei, a top executive at BYD, disclosed through a post on Weibo that Berkshire commenced reducing its holdings in August 2022, with its ownership share eventually falling below 5% by June 2024. Li further articulated, “We are deeply thankful for the recognition BYD received from Charlie Munger and Warren Buffett.” The initial investment in 2008 was notably championed by Munger, who famously lauded BYD as a "miracle" enterprise.
Berkshire Hathaway's Profitable Exit and BYD's Perspective on Investor Decisions
Berkshire's quarterly financial disclosure confirmed that it no longer held any interest in BYD, having completely sold off more than 225 million shares. Stella Li, BYD's Executive Vice President, noted that both Buffett and Munger had a strong affinity for BYD, but highlighted that "investment transactions are their prerogative." An advisor to BYD also verified that Berkshire realized an approximate twenty-fold return on its original investment. The sentiment was clear: "They are investors; therefore, buying and selling are integral to their business, and their decision is not indicative of any dissatisfaction with us."
Market Sentiment Reacts to Berkshire Hathaway's Divestment
Following the official confirmation of Berkshire's complete withdrawal, BYD's shares experienced a decline of over 6% in Hong Kong during the week. The stock has seen a 28% decrease since the beginning of the year, reflecting broader concerns regarding the company's decelerating expansion.
BYD's Operational Challenges and Revised Financial Outlook
BYD recently revised its sales forecast for 2025 downwards by 16% and reported its first quarterly profit reduction in three years last month. The company has also implemented price reductions through the year's end and scaled back production in response to diminishing consumer demand.
Berkshire Hathaway's Strategic Pivot Towards Japanese Markets
Concurrently with its exit from the Chinese market, Berkshire Hathaway augmented its investments in Japanese companies. Mitsui & Co. confirmed that Berkshire now possesses more than 10% of its voting stock, with this stake valued at roughly $7.3 billion. Similarly, Mitsubishi Corp. announced that Berkshire had increased its holding to 10.2%.