While Tesla has to deal with declining sales figures, Warren Buffett’s investment in BYD continues to pay off.
• Tesla with a drop in sales in the first quarter
• BYD has delivered significantly more units than Tesla
• Buffett seems to have put on the right company
Tesla disappointed with deliveries
The deliveries of Tesla fell by around 13 percent in the first quarter of the year. The US electric car manufacturer delivered 336,681 vehicles – and thus expected significantly less than from analysts. A possible reason for the decline could have switched to a renewed generation of Model Y. In addition, Tesla also produced 16 percent fewer vehicles in the past quarter than in the same period last year (362,615 cars). In addition, the criticism of Tesla boss Elon Musk increased in recent months. Recently there were even boycott calls and protest.
BYD in Q1 before Tesla
Meanwhile, BYD has recently significantly increased its sales. In March, Tesla’s Chinese competitor sold a total of 377,420 vehicles, which means an increase of 24.8 percent compared to the previous year. NEV was responsible for the majority of the deliveries for passenger transport, with an increase of 23.14 percent to 371,419 units. In the first quarter, BYD delivered 1,000,804 NEVS – an increase of 59.8 percent compared to the same period last year. With 416,388 purely battery -electric vehicles, BYD also delivered significantly more units in the first quarter than Tesla in the same period.
Vehicles now better than Teslas?
BYD has also improved its batteries. The BYD blade battery, as reported by Marketwatch, is the safest tested EV battery and practically indestructible. At the beginning of this year, the company with “God’s Eye” launched an autonomous driving system that belongs to the standard equipment of the $ 9,500 Seagull Hatchback, while Tesla is looking for around $ 15,000 or a monthly subscription to its full self-driving software, which is currently still blocked by the Chinese authorities. According to Marketwatch, the keyword at BYD is vertical integration. BYD controls every part of its supply chain, from the lithium mines to semiconductors and batteries to engines. This vertical integration paired with disciplined financial management, a solid cash flow and conservative debt results in a perfect buffet investment.
Buffett with a good feeling
Star investor Warren Buffett seems to keep right with his bet on BYD. He probably saw potential in the company in 2008 when it was probably still rather unknown to many. At that time, Berkshire Hathaway bought 225 million BYD shares for around $ 230 million in silence and thus had almost 10 percent of the company, reports Marketwatch. Today, the proportion of Buffett’s Investment Holding is six to eight billion US dollars and thus worth 25 to 30 times the original investment. Although Berkshire Hathaway has now taken profits and reduced his position since 2022 or reduced it to a share of five percent by mid-2024, the Oracle of Omaha recently confirmed its enthusiasm for BYD at the 2024 Berkshire annual meeting. “Charlie [Munger] knocked on the table twice … and said: ‘Buy byd.’ He was right – on a large scale, “says Marketwatch Buffett.
Editor finance.net
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