Warren Buffett Reiterates Support for BYD

On Monday, Warren Buffett visits BYD's Shenzhen headquarters for a signing event for the company's plans to construct an energy storage facility with China Southern Power Grid.
Author:
Publish date:


NEW YORK (TheStreet) -- Although many investors had speculated that Warren Buffett and Berkshire Hathaway (BRK.B) - Get Report would raise the possibility of selling their stake in Chinese auto and battery maker BYD, as its stock value has declined in the face of numerous troubles, the billionaire investor has instead reaffirmed his support for the company, according to reports.

On Monday, Buffett visited BYD's Shenzhen headquarters for a signing event for the company's plans to construct an energy storage facility with

China Southern Power Grid

and celebration of the selling of its millionth car,

Reuters

said.

Warren Buffett, chairman of Berkshire Hathaway, center, arrives for a BYD press event in Shenzhen, Guangdong province, China.

Reuters

added that during the event, Buffett told his audience that his visit to Shenzhen wouldn't be his last, while

Bloomberg

said that Buffett said BYD would be an electric vehicle leader.

He indicated that the young company was filled with potential.

So far, all of BYD's electric E6 vehicles, launched earlier in 2010, have been operated as taxis in Shenzhen. According to

Bloomberg

, Buffett told BYD dealers that he had test-driven the vehicle in May and found it impressive.

According to

Reuters

, citing local reports, BYD spent several million yuan to bring Buffett to its China headquarters.

In 2008, Buffett's Berkshire Hathaway purchased 10% of BYD for $230 million. The value of the stake has now skyrocketed to a staggering $1.6 billion. Still, this latest figure is slightly less impressive than the $2.5 billion value achieved last October.

>>>View Warren Buffett's Portfolio

The value of Buffett's stake in BYD began to slide as the company encountered troubles this year -- including a setback in plans to export its electric vehicles, a fall in sales and a legal battle with the government involving land development. Many began to believe that he was ready to cash out of his investment.

Berkshire Hathaway stock is up 0.5% to $83.73 in late morning trading.

-- Written by Andrea Tse in New York.

>To contact the writer of this article, click here:

Andrea Tse

.

>To follow the writer on Twitter, go to

Andrea Tse

.

>To submit a news tip, send an email to:

tips@thestreet.com

.

RELATED STORIES:

>> Buffett to Sell Stake in Chinese Automaker BYD?

Copyright 2010 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.