How China’s Tesla is Taking the World of Electric Vehicles by Storm

When investors talk about the company at the vanguard of the revolution in electric vehicles (EVs) in the United States, only one company typically comes to mind: Tesla Motors, Inc. (TSLA).

And although investors in Tesla have fared well, with the stock up almost 12-fold since its initial public offering (IPO) in 2010, the stock today is trading pretty much where it was at the start of 2014.

Indeed, some of the world’s best investors are betting on a different horse to win the global EV race.

Back in 2008, Warren Buffett’s Berkshire Hathaway (BRK-B) created a buzz when it invested in Shenzhen, China-based BYD Company Ltd. (BYDDF), then still an obscure startup.

Berkshire’s initial investment in BYD was suggested by Warren Buffett’s partner, Charlie Munger.

After meeting BYD CEO Wang Chuanfu, Munger described him as “a descendant of both Thomas Edison and Jack Welch.”

Berkshire eventually took a 10% stake in BYD for $230 million.

Today, Berkshire’s 9.1% stake in BYD is worth about $1.61 billion.

That’s an annual return of more than 25% per year, making BYD Berkshire’s top investment over the last decade.

Other high-profile investors are now getting on the bandwagon. Just last week, Samsung took a stake in BYD for $450 million.

And in terms of stock price performance, BYD is starting to pull ahead of its higher-profile rival.

BYD sold its first hybrid in 2008, long before Tesla went into production.

Deliveries of its first all-electric car, the e6 — a boxy, midsize all-electric hatchback used by taxi companies in China and Europe — began in 2011, a year ahead of the first sales of Tesla’s Model S. Last year, BYD sold 61,722 EVs to become the world’s largest producer. BYD expects that number to almost triple again this year, with sales surpassing 150,000.

BYD has sold its mass-produced, fully electric buses in more than 110 cities in 36 countries. BYD is also quietly building a U.S. business that supplies rechargeable buses to transit agencies in Los Angeles, Long Beach and Gardena in California, Denver and St. Albert in western Canada.

At its current pace, CEO Wang expects BYD to join the ranks of the Global Fortune 500 companies by 2017.