Fortune Puts Warren Buffett In "Car of the Future" Driver's Seat
Warren Buffett is in the driver's seat when it comes to the "car of the future," says Fortune.
The magazine has put Buffett on its cover ("Buffett's Electric Car") along with the BYD E6, for a major story on Berkshire Hathaway's investment last fall in the Chinese company that is working to challenge the world's biggest automakers in the electric car arena. The cover asks, "If the Oracle's plugging in, shouldn't you?"
In the article by Marc Gunther, we learn that the idea of investing $230 million for 10 percent of the "obscure Chinese battery, mobile phone, and electric car company" first came from Buffett's partner Charlie Munger.
Munger had met BYD's driving force, Wang Chuan-Fu, through a mutual friend, and was uncharacteristically enthusiastic. Munger describes Wang to Fortune: "This guy is a combination of Thomas Edison and (former General Electric Chairman) Jack Welch - something like Edison in solving technical problems, and something like Welch in getting done what he needs to do. I have never seen anything like it."
That enthusiasm from Munger helped Buffett to overcome his well-known reluctance to invest in technology, because he only likes to put money into things he can easily understand.
Fortune quotes Buffett as admitting, "I don't know a thing about cellphone or batteries. And I don't know how cars work." But, "Charlie Munger and (MidAmerican Energy Chairman) Dave Sokol are smart guys, and they do understand it. And there's no question that what's been accomplished since 1995 at BYD is extraordinary."
Plus Wang turned down Berkshire's initial offer to buy 25 percent of BYD. Says Buffett, "This was a man who didn't want to sell his company. That was a good sign."
After an extensive profile of Wang's tireless efforts on behalf of his company, Fortune concludes, "Buffett may not understand batteries or cars, or Mandarin for that matter. Drive, however, is something that needs no translation."
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