Warren Buffett's Chinese Cars Are Coming to the U.S.
BYD says that its electric E6 will have a range of 186 miles when it comes to the U.S. But will Americans buy a Chinese electric car? Source: BYD
Are you ready to buy Warren Buffett's Chinese car?
You might get your chance before long.
BYD Auto is a Chinese automaker that is partially owned by Warren Buffett's Berkshire Hathaway . For several years now, BYD has been talking optimistically about its plans to export Chinese-made cars to the United States. Now, the company is saying that it will begin offering its cars to Americans by the end of 2015.
BYD has done some intriguing work with hybrids and electric cars. But BYD has a long history of optimistic predictions, and the company has had a rough time staying competitive even in its home market. But the Berkshire Hathaway investment has given the company some global cred. Is it time to take them seriously?
As Fool contributor John Rosevear explains in this short video, it's one thing to compete with other Chinese domestic automakers at the low end of China's huge auto market, another thing entirely to compete with the world's best on their merits. But that's what BYD says it's going to do: Does it have a chance?
Would you buy a Chinese-made car? Check out John's report in the short video below. Then, scroll down to leave a comment and share your view.
A transcript of the video is below.
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Hey Fools, it's John Rosevear. Are you ready to buy Warren Buffett's Chinese car? You might get your chance before long.
BYD Auto is a Chinese automaker that is partially owned by Warren Buffett's Berkshire Hathaway. BYD has done a lot of interesting work around hybrids and electric cars, they actually have a substantial lithium-ion battery business as well as a solar panel division, but like a lot of Chinese automakers, their vehicles haven't really been ready for prime time, they've been at the low end, the inexpensive end, of the Chinese auto market and they haven't really had much export success, because they haven't been seen as competitive with the big global automakers in terms of things like crashworthiness and fit and finish. But they've gradually been catching up, as we've all expected, and now BYD says that it plans to introduce four models in the U.S. at the end of 2015.
This isn't the first time BYD has tried to come to the U.S., I could dig through the Motley Fool's archives and find articles I'd written saying they were coming by the end of 2010, or 2012, and those plans didn't pan out. But a BYD official told Bloomberg last week that the company will be much better prepared this time around. BYD says its cars are more fashionable, with improved design and safety features, and that the company is no longer planning to compete as a low-cost alternative, but want to compete on quality and innovation with the big global players.
BYD has a new plug-in hybrid sedan that will likely be its flagship here in the U.S., that car went on sale in Beijing last month. It costs around $31,000 and gets about 43 miles of range on its batteries before the gasoline engine kicks in, which is competitive with cars like General Motors' Chevy Volt.
It remains to be seen whether cars that were both developed and manufactured in China will be able to get traction here in the U.S., but BYD isn't the only Chinese automaker setting its sights on the U.S. market. Geely Auto has said that it plans to export Chinese-made cars to the U.S. starting in 2016. But there's one big difference: Geely owns Swedish automaker Volvo, and the models it plans to bring to the US were developed with Volvo's help and may come here badged as Volvos. Volvos that happen to be made in China might have an easier time winning over U.S. customers than a Chinese brand trying to build a presence from scratch, but we'll see.
Certainly, a lot of automakers are going to be watching to see how this plays out, because I think a lot of the big global automakers would love to export cars from developing markets to the US. It'll be interesting to watch, for sure. Thanks for watching, and Fool on.
The article Warren Buffett's Chinese Cars Are Coming to the U.S. originally appeared on Fool.com.
Fool contributor John Rosevearowns shares of General Motors. You can connect with him on Twitter at @jrosevear. The Motley Fool recommends Berkshire Hathaway and General Motors. The Motley Fool owns shares of Berkshire Hathaway. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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