You have to love a story in which an individual takes control of a company and then works hard to build that company to compete against dinosaurs that have more advanced technology and have been in the business for a greater number of years. In the past year, BYD has garnered national attention as an individual in Omaha has taken a 10% stake in the Chinese auto manufacturer. A big reason for Buffett’s interest in BYD is its CEO Wang Chuanfu, who has built up this once bankrupt auto maker into a potential powerhouse in the hybrid and electric car arena. But, as Chinese auto manufactures try to capture market share in the U.S. some critics and individuals are going to start questioning the safety, quality, and political aspects of allowing Chinese autos on U.S. soil.
First impression on some of BYD’s products…..
This week was my first time actually seeing some of BYD’s products and I was really not impressed. Again, I am no car buff and I’m usually a couple years behind on the latest trends in the auto industry but if you had put a “KIA” logo in front of the auto, I would not be able to notice a difference.
Politics, Politics, Politics….
Two of Detroit’s “big” three are currently on the brink of bankruptcy and the last thing we need is another foreign manufacturer to make the restructuring process tougher. The American government has injected billions into GM and Chrysler and one has to wonder whether they will impose tariffs on imported Chinese autos. Whether BYD will produce autos is another issue. The biggest advantage over American manufacturers they have is their cost of labor. But, assuming they stick to producing their cars in China, that T word arise again (Tariffs). And if they do produce their autos in America, one has to take into account the role the UAW will play.
Public Perception and Men w/ Toys
Just like GM faces the infamous “low quality, dang thing breaks down every week” perception, BYD might face that “oh crap, its made in China” perception from the general public. At the same time, I have not read or seen anything that BYD will have a nice pick-up truck in the works. Personally, I prefer a nice pick up truck (see below) and apparently I am not the only one, as I counted the number of pick-ups to cars in my alley and the result was an overwhelming 12-1 in favor of the pick-ups ( the one was a secretary’s car , go figure).
Those boys from Omaha….
Obviously, Berkshire sees something in BYD to invest in the company. My guess, from videos and articles I have read, Wang Chuanfu is seen as the Chine Henry Ford with a passion and drive to get the job done. If so, this is great. I say this not because I’m spending 15 minutes of my life to point out some of the obstacles BYD might face, but because its great to see an individual work hard to get to the point where they’re at and see what they do next. I am watching this from a business perspective and a historical perspective. Who knows, maybe 20,40, 100 years from now BYD might be the auto manufacturer employing thousands of Americans similar to what Toyota and other foreign auto manufacturers are doing nowadays.
Meet Wuang Chuanfu
{ 5 comments… read them below or add one }
I hear that you will be able to buy BYD cars at costco.
I don’t think BYD will send a car to USA anytime soon. I imagine we will see their batteries in our hybrids here though. BYD will likely compete in emerging markets like TATA motors does. Middle classes booming around the world are the new exploding market to tap.
Never say Never. I believe its the 3rd video with the CEO that says he might do some sort of partnership with a larger auto maker. It could license some of its technology , especially their batteries, to someone with a market in the U.S.
Interesting point of view …some chinese will achieve BYD and Ford make some cars in Romania…
Is seems like the author of this topic has a 6 number salary a month and trying to spead the old idea that americans do not need the small, fuel efficient and, most important, inexpensive cars.
So, will we contonue spending 30-40K for the 20-th century idols, eliminating
Earth reserves and going to the ecologic desister?
I hope that most of americans think differently today.
And let leave the author’s big truck happiness behind us.