2010: How did Buffett analyze BYD?
AUDIENCE MEMBER: Mr. Buffett and Mr. Munger. This is Eric Chang from Beijing, China.
First, thanks for the occasion for us to engage with you like this, and also for inspiring young people to learn. Mr. Munger has described you as an incredible learning machine in terms of learning new areas, and expanding your circle of competence.
So I would like to understand is if you can make it more concrete, recently you make investment in BYD, a company in China that makes batteries and also electric cars which are, arguably, technology companies.
So can you sort of go through that example and see how you sort of like analyzed the case and asked questions that helped you make a decision to invest in such a company? Thank you.
WARREN BUFFETT: Charlie deserves 100 percent of the credit for BYD, so I’m going to let him answer that.
CHARLIE MUNGER: Well, it’s an interesting example because Berkshire would not have made an investment in BYD if the opportunity had come along five or 10 years earlier. And it shows that the old men are continuing to learn, and that’s absolutely essential.
Berkshire would have a lower potential than it does if we had stayed the way we were. And — so you are absolutely right in calling attention to this episode.
Again, Dave Sokol helped. I wasn’t at all sure I could get Warren to do this all by myself so I inveigled Dave into going over to China, and the two of us were able to help the learning process. (Laughter)
WARREN BUFFETT: Well put. Well put.