CNBC: Buffett is selling his stake in China's biggest electric vehicle maker

Berkshire Hathaway, the investment company of the legendary Warren Buffett, continued to reduce its stake in China's largest electric vehicle manufacturer, writes CNBC.

According to a Hong Kong stock exchange filing, Berkshire recently sold 1.3 million shares of Hong Kong-listed BYD for $39.8 million. The deal reduced the investment vehicle's holding in the struggling company to 6.9% from 7%.

Berkshire first acquired shares of the Shenzhen-based automaker in 2008, when it bought 225 million shares for about $230 million. The investment proved extremely profitable, given that the electric vehicle market had a strong growth in China and other countries of the globe.

In 2022 and 2023, Buffett's investment vehicle sold half of its stake in BYD after the stock price had risen nearly 600 percent from its 2008 level, hitting an all-time high about two years ago.

Under Hong Kong stock exchange regulations, shareholders must announce when a holding exceeds or falls below a whole number, so investors won't know if Buffett will sell any more BYD shares until, and if, he falls below the 6 percent threshold in the company.

• Charlie Munger's legacy

BYD was founded by Wang Chuanfu, starting to produce batteries for mobile phones as early as the 1990s. In 2023, the company began to focus on cars and has since become the largest car brand in China, as well as a major manufacturer of batteries for electric vehicles.

In the fourth quarter of last year, BYD overtook Tesla to become the world's largest electric vehicle maker, also having higher sales than its rival in the United States. In 2010, Buffett stated that the investment in BYD was 100% due to Charlie Munger, the former vice chairman of Berkshire. Munger was introduced to BYD by his friend Li Lu, the founder of Seattle-based asset manager Himalaya Capital, according to CNBC.

Charlie Munger died last November, just a month before his 100th birthday.