Rivian Automotive, which debuted on Nasdaq a week ago at $78 per share, now trades at nearly $150. Lucid Group, which went public through a SPAC deal this summer, surged 77% over the past month.
However, Buffett bought into the industry more than a decade ago. He poured hundreds of millions into Chinese electric-vehicle maker BYD, and that bet is now paying off handsomely.
Here’s a look at the legendary investor’s favorite EV stock — along with two other Chinese manufacturers that may be worth pouncing on with any extra cash you’ve got.
Warren Buffett isn’t known for chasing hype, but that doesn’t mean he’s missing out on the current EV boom.
Then there’s Tesla, which despite its recent pullback, is up a whopping 148% over the past year.
Jengtingchen / Wikimedia Commons
In 2008, Buffett’s company Berkshire Hathaway bought 225 million shares of BYD for $232 million.
Berkshire’s latest shareholder letter shows it still held those shares as of Dec. 31, 2020 — except their market value had surged to roughly $5.9 billion. Considering that BYD has gone up another 34% this year, Buffett’s company would have racked up another $2 billion gain on that position, assuming he hasn’t sold any shares.
And there’s more to the company than just hype. In Q3, BYD sold 183,000 new electric vehicles (including hybrids), up 294% year over year. And when it comes to pure EVs, the company sold 91,616, representing a 186% increase. But despite its entrenched position, BYD shares are not listed in America. They only trade over the counter here, so you would need to use a specialized broker.
Thankfully, other fast-growing Chinese EV makers have made it to U.S. stock exchanges. NIO (NIO)
The company entered the market in December 2017 with a seven-seat premium electric SUV called the ES8. One year later, it debuted the ES6, and in late 2019, NIO added a five-seat “crossover coupe” SUV called the EC6 to its lineup. The company delivered 24,439 EVs in the third quarter of this year, doubling the number of EVs delivered during the same period last year. As of Oct. 31, cumulative deliveries of NIO’s three models have surpassed 145,000 vehicles.
NIO is one of them. Jengtingchen / Wikimedia Commons