Due to the looming threat of climate change, energy companies have had to come up with other ways of producing energy without emitting too much carbon dioxide. this is where electric cars come in; besides producing less greenhouse gas emissions, their fuel costs are also quite low compared to traditional gasoline cars. Electric vehicle engines are actually more efficient than internal combustion engines.
Warren Buffett who is famous for his rules on investing has invested in BYD a Chinese electric car company. Buffett was first impressed by the entrepreneur behind BYD. Berkshire Hathaway has invested $230 million in BYD which has earned them a 10% share in BYD. Berkshire Hathaway initially tried to buy 25% but the owner turned down their offer since he was not willing to let go of more than 10% of his company’s stock. According to Buffett, this is a good sign since it shows that he does not want to sell his company.
Buffett and company think that BYD could actually become the world’s largest automaker specializing in electric cars. BYD entered the automobile business by purchasing a Chinese state owned car company. they are now selling an electric car known as the F3DM that comes with a back up gasoline engine. besides costing much less than the Prius and Chevy Volt, this car goes for 62 miles on a single charge.
Google.org has not been left behind when it comes to investing in EV. they have invested millions of dollars in Aptera motors, a start up company dealing with electric vehicles. The company has been manufacturing a 3-wheeled electric vehicle known as the Typ-1.
Individuals can also make smart investments by investing in companies that are making electric vehicles and other energy efficient devices. this way, they will be investing in the future. Several electric vehicle companies are seeking investors since they do not have enough cash to cover the manufacturing costs. as the cost of fuel / oil continues to rise, the share prices of companies involved in the electric vehicle sector will also increase.
One such company is Altair Nanotechnologies (NASDAQ: ALTI), a company that manufactures nano lithium titanate batteries. The company became involved in the electric vehicle industry when they began providing batteries for Phoenix Motorcars. Phoenix Motorcars is one of the companies that have brought all electric cars to the market.
Another company that would make a good investment is UQM technologies, an electric vehicle company that has been providing Phoenix Motorcars with propulsion systems, generators and converters. Though most current electric vehicle orders are coming from utility and government fleets, the market has a lot of potential. The 100 million American who drive less than 30 miles per day, are being targeted by electric vehicle companies.
Since there are several new and established companies in the electric vehicle industry, investors may have a hard time deciding what company to invest in. here are a few factors you should consider when investing in EV.
• Uniqueness and superior technology advantage – find a company that has unique expertise in addressing existing and emerging problems in the marketplace.
• Value – the ideal company will either create value for end consumers or they will be good at something that incumbent player’s value. for example Tesla has developed expertise in EV drive train development.
• Volumes – Though there are various niches in the automobile market, one must evaluate the company’s ability to scale to high volumes in terms of manufacturing and distribution.
• Brand Value – Very many new automotive brands have been created in recent years and these brands now have the ability to build equity with customers.
Finally, if you are interested in investing in BYD just like Warren Buffett, there are several ways to do it.
1. You can buy BYD shares directly on the Hong Kong stock exchange where BYD is listed as BYD Company Limited
2. You can buy BYD auto shares over the counter under the ticker BYDDF
3. You can invest in ETF a Chinese technology company that has allocated 3.71% of its capital to BYD.
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