In remarks given during a weekend conference, CEO Warren Buffet and vice chairman Charlie Munger, both of investment firm Berkshire Hathaway, expressed uncertainty over the electric vehicle market and its current competitive makeup in the U.S.
While both investors spoke positively about the sector’s prospects, neither felt comfortable naming a reliable frontrunner among the industry’s current electric car manufacturers. “You will see a change in the vehicles,” remarked Buffet, “but you won’t see anybody that owns the market because they changed the vehicle.” Munger agreed, clarifying, “at the moment, [EVs are] imposing huge capital costs and huge risks–and I don’t like huge capital costs and huge risks.”
“Charlie and I for long have felt the auto industry is just too tough. It’s just a business where you’ve got a lot of worldwide competitors…And it looks like there are winners at any given time, but it doesn’t get you a permanent place,” Buffet continued. “I think I know where Apple’s going to be in five or ten years…I don’t know what the car companies are going to be in five or ten years.”
The two executives made their comments in response to an audience member’s question on zero-emission vehicles. The remarks arrive amidst a backdrop of dissipating shareholder confidence in automakers such as Tesla, which still remains the top player in American EVs. The car brand’s CEO, Elon Musk, has reportedly made several attempts to earn investments from Berkshire Hathaway. “Munger could’ve invested in Tesla at -$200M valuation when I had lunch with him in late 2008,” reads one of the entrepreneur’s Twitter posts from February. Musk also responded to a tweet asking where the firm should invest its money with, “Starts with a T…”
While Buffet and Munger never mentioned Tesla in their replies, Berkshire Hathaway has so far declined to invest in the automaker, although the two executives have expressed confidence in at least one of its competitors. The vice chairman was largely responsible for the investment firm’s purchase of 225 million shares in Chinese EV brand BYD in 2008. Earlier this year, Munger called the extent to which BYD outperformed Tesla in China “almost ridiculous.”
