Buffet’s Advice Powering Chinese Car Company’s Sales?
November 10, 2009 10:00 AM
Warren Buffet seems to be weaving his magic again. His advice to the Chinese car maker BYD seems to be working. BYD’s sales skyrocketed taking it to the first position in compact car segment.
Buffet invested in this company in 2008. At that time, BYD’ sales ranked 4th. In the mini car segment, BYD’s yet another model – the FO – is the 2nd largest seller. As per the projection made by J.D. Power and Associates, BYD’s car sales may accelerate by 137% by the end of the year.
In the first 6 months, BYD’s profits increased 72%. Also on the ascent is BYD’s stock. After 2008, the stock of BYD rose sevenfold. However, WSJ feels that BYD’s plans to sell electric cars to Chinese buyers may face more uncertainty. BYD is using lithium-ion battery technology for the electric car. Critics were disappointed with BYD’s electric car.
