Warren Buffett: "Chinese Electric Cars Over GM"

Source: CNBC

[Asia Economy Reporter Yujin Cho] Warren Buffett, chairman of Berkshire Hathaway, has been found to hold a larger stake in the Chinese electric vehicle company than in General Motors (GM), the largest automaker in the United States.

In his annual letter to shareholders, Chairman Buffett revealed that "Berkshire Hathaway holds an 8.2% stake (approximately $232 million) in the Chinese electric vehicle company BYD," reported on the 1st (local time) by U.S. economic media CNBC. This is a higher stake than Berkshire Hathaway's 3.7% holding in GM.

Berkshire Hathaway has held shares in BYD since 2008. BYD started in 1995 as a mobile phone battery manufacturer and entered the electric vehicle manufacturing industry in earnest by acquiring Qinchuan Automobile in 2002.

Headquartered in Shenzhen, China, the company sold more than 130,000 electric vehicles last year. This figure far exceeds the sales volume of its competitor Nio, known as the "Tesla of China," which sold 43,700 units.

Listed on the Hong Kong Stock Exchange, BYD ranked 8th in market capitalization at the end of last year. While BYD's stock price surged more than 300% over the past year, GM's stock price increased by only 65%, proving Buffett's choice was correct.

GM holds a comparative advantage in sales but is at a disadvantage in the transition to electric and autonomous vehicles. Last month, GM announced plans to fully transform into an electric vehicle company by 2035, accelerating its shift to electric vehicles.

GM plans to invest $27 billion (approximately 30.2 trillion won) in electric and autonomous vehicles by 2023 and aims to sell 30 electric vehicle models worldwide by 2025.