Buffett’s Berkshire Hathaway Fully Exits BYD Stake After 17 Years
Table of Contents
- 1. Buffett’s Berkshire Hathaway Fully Exits BYD Stake After 17 Years
- 2. A Phased Exit
- 3. Market Reaction and BYD’s Response
- 4. The Broader Context of Investor Shifts in the EV Market
- 5. Frequently Asked Questions About Berkshire Hathaway and BYD
- 6. What impact could Berkshire Hathaway’s remaining 6.2% stake in BYD have on investor confidence moving forward?
- 7. Warren Buffett’s Decision on BYD Leads to Sharp Decline in Share Prices
- 8. The Berkshire Hathaway Exit: A Timeline of Events
- 9. Why Did buffett Sell? Analyzing the Potential Motivations
- 10. Impact on BYD’s Share Price and Market Sentiment
- 11. BYD’s Response and Future Outlook
- 12. Implications for Investors: what Should You Do?
- 13. Understanding the EV Landscape & Key Players
Berkshire Hathaway, the investment conglomerate led by Warren Buffett, has completely divested its holdings in Chinese electric vehicle manufacturer BYD. The move marks the end of a substantial 17-year investment that began in September 2008, when Berkshire initially acquired 225 million shares. This decision follows a gradual reduction in the stake over the past two years.
The initial investment,prompted by a suggestion from Charlie Munger,cost Berkshire Hathaway approximately $230 million. By the second quarter of 2022, this investment had grown exponentially, reaching a value of $9 billion. However, Berkshire began to reduce its position in BYD that same year.
A Phased Exit
Berkshire’s selling process was not a sudden event. By June 2023, the company had offloaded around 76 percent of its BYD shares, reducing its stake to below 5 percent. This level triggered the removal of the requirement to publicly disclose further sales, in accordance with Hong Kong Stock Exchange regulations.
The complete exit was confirmed in Berkshire Hathaway Energy’s (BHE) first-quarter financial report for 2024, which listed the BYD investment at a “0 Value.” A company spokesperson subsequently confirmed these reports.
Market Reaction and BYD’s Response
News of the complete sale triggered a notable downturn in BYD’s stock price. Shares traded on the Hong Kong Stock Exchange experienced their largest single-day decline in three weeks,falling by as much as 3.6 percent. This made BYD the worst-performing Chinese stock on the exchange that day.
BYD’s General Manager of Brand and Public Relations, Li Yunfei, addressed the news on the Chinese social media platform Weibo, stating that stock trading is standard investment practice.He expressed gratitude for the long-term support and friendship provided by Munger and Buffett.
Did You No? Berkshire hathaway’s initial investment in BYD was one of the company’s earliest major forays into the electric vehicle sector, demonstrating a forward-thinking approach to emerging technologies.
| Event | Date | Details |
|---|---|---|
| Initial Investment | September 2008 | Berkshire Hathaway acquires 225 million BYD shares for $230 million. |
| Peak Value | Q2 2022 | Investment reaches a value of $9 billion. |
| Stake Reduction | June 2023 | Berkshire sells approximately 76% of its BYD shares. |
| Complete Exit | Q1 2024 | BYD investment listed at “0 Value” in BHE report. |
Pro tip: Investors shoudl remember that even legendary investors like Warren Buffett occasionally adjust their portfolios based on evolving market conditions and strategic priorities.
The Broader Context of Investor Shifts in the EV Market
Berkshire Hathaway’s exit from BYD is part of a larger trend of investor reassessment within the electric vehicle market. While the EV sector continues to experience growth, heightened competition and fluctuating demand have led to increased volatility in stock prices. Companies like tesla have also faced investor scrutiny amid concerns about production targets and profit margins.
The shift away from BYD could signal a reassessment of risk and return within the Chinese EV market specifically, given growing geopolitical tensions and regulatory uncertainty. The global electric vehicle market is expected to reach $800 billion by 2027,according to a report by BloombergNEF,but navigating this growth requires careful evaluation of individual companies and regional dynamics.
Frequently Asked Questions About Berkshire Hathaway and BYD
- What was the initial return on Berkshire Hathaway’s BYD investment? The investment gained over 4,500 percent of its initial purchase price before being fully divested.
- Why did Berkshire Hathaway begin selling its BYD shares? The exact reasons are not explicitly stated, but it’s likely due to a combination of factors, including market conditions and portfolio adjustments.
- What impact did the sale have on BYD’s stock price? The proclamation of the sale led to a significant decline in BYD’s stock price,with a decrease of up to 3.6 percent on the Hong kong Stock Exchange.
- Is this a negative signal for the electric vehicle market? Not necessarily. It reflects a strategic decision by Berkshire Hathaway and does not indicate a broader downturn in the EV sector.
- What did BYD’s PR manager say about the sale? Li Yunfei expressed gratitude for the 17 years of investment, support, and friendship from warren buffett and charlie Munger.
- Were did Berkshire Hathaway first invest in BYD? berkshire Hathaway bought 225 million shares in September 2008.
- how did Berkshire Hathaway officially confirm the sale? Through their Q1 2024 financial report, listing the BYD investment at “0 Value”.
What impact could Berkshire Hathaway’s remaining 6.2% stake in BYD have on investor confidence moving forward?
The Berkshire Hathaway Exit: A Timeline of Events
On September 22nd, 2025, news broke that Berkshire Hathaway, led by Warren Buffett – the “Oracle of Omaha” and one of the world’s most triumphant investors (currently ranked tenth richest with a net worth exceeding $122 billion, as of Finbold’s latest report) – had considerably reduced its stake in BYD, the Chinese electric vehicle (EV) giant. This move triggered a substantial drop in BYD’s Hong Kong-listed shares, falling as much as 20% during intraday trading. The reduction involved selling approximately $477 million worth of BYD shares.
This isn’t a complete exit,however. Berkshire Hathaway still holds around 6.2% of BYD’s total issued H-shares, down from the previous 20.07%.The initial investment in BYD dates back to 2008, a period when many Western investors where hesitant about Chinese companies. Buffett’s early bet on BYD proved remarkably successful, generating substantial returns for Berkshire Hathaway over the years.
Why Did buffett Sell? Analyzing the Potential Motivations
Several factors likely contributed to Buffett’s decision to trim his BYD holdings. While the exact reasoning remains speculative, industry analysts point to a confluence of influences:
* Profit Taking: After years of notable growth, BYD’s stock price had reached a point where substantial profit-taking was logical. Berkshire hathaway’s investment has yielded notable returns, and reducing the position allows them to realize those gains.
* Geopolitical risks: Increasing geopolitical tensions between the US and China may have prompted a reassessment of risk exposure. While buffett has historically taken a long-term view, the evolving political landscape could influence investment decisions.
* Competition in the EV Market: The electric vehicle market is becoming increasingly competitive, with established automakers and new entrants vying for market share. This heightened competition could impact BYD’s future growth prospects.
* Shift in Berkshire Hathaway’s Portfolio: Berkshire Hathaway has been gradually increasing its investments in other sectors, including energy and insurance. Reallocating capital from BYD could be part of a broader portfolio diversification strategy.
* BYD’s Increasing Independence: BYD has matured significantly since Berkshire Hathaway’s initial investment. The company is now less reliant on external funding and has established itself as a major player in the global EV market. This reduced need for Berkshire’s support may have influenced the decision.
The immediate impact of the news was a sharp decline in BYD’s share price. this decline reflects investor concerns about the future direction of the company and the potential implications of losing a key shareholder like Berkshire Hathaway.
* Hong Kong Stock Drop: As mentioned, BYD’s Hong Kong-listed shares experienced a significant intraday drop of up to 20%.
* Investor Confidence: The sale has shaken investor confidence, leading to increased volatility in BYD’s stock.
* Market-Wide Effects: The news also had a ripple effect on the broader EV market, with shares of other EV manufacturers experiencing moderate declines.
* Analyst Downgrades: Several financial analysts have downgraded their ratings on BYD stock following the announcement, citing increased uncertainty.
BYD’s Response and Future Outlook
BYD has acknowledged the reduction in Berkshire Hathaway’s stake but has remained relatively calm.The company emphasized its strong financial position and continued growth prospects. BYD continues to be a dominant force in the Chinese EV market and is expanding its presence globally.
* Strong Sales Figures: BYD continues to report robust sales figures for its electric vehicles and batteries.
* Technological Innovation: The company is investing heavily in research and development, particularly in battery technology and autonomous driving.
* Global Expansion: BYD is actively expanding its operations into new markets, including Europe and Latin America.
* Battery Supply Chain: BYD’s vertically integrated supply chain, including battery production, gives it a competitive advantage.
Implications for Investors: what Should You Do?
The situation presents a complex scenario for investors. While the decline in share price may seem alarming, it could also present a buying opportunity for long-term investors who believe in BYD’s potential.
* Long-Term Outlook: Investors with a long-term investment horizon should consider the underlying fundamentals of BYD and its growth prospects.
* Risk Tolerance: Assess your risk tolerance before making any investment decisions. The EV market is volatile, and BYD’s share price could experience further fluctuations.
* Diversification: Diversify your portfolio to mitigate risk. Don’t put all your eggs in one basket.
* Stay Informed: Keep abreast of the latest developments in the EV market and BYD’s performance.
* consult a Financial Advisor: Seek professional advice from a qualified financial advisor before making any investment decisions.
Understanding the EV Landscape & Key Players
Beyond BYD, the electric vehicle market is populated by several key players. Understanding these competitors is crucial for assessing BYD’s future.
* Tesla: Remains the global leader in
