BYD plug-in is China's fourth top-selling car

Chinese battery giant BYD has seen its F3DM -- the first mass-market plug-in hybrid car to go to on general sale anywhere in the world -- rocket to fourth place on its home-market sales charts.

After a slow start following its launch in December 2008, the F3DM ('DM' for 'dual mode') turned in a star performance amid total first-half vehicle sales for the company, which more than doubled year-on-year to 176,814.

There's no clear information on the F3's proportion of this, but China Car Daily's April figures might provide a pointer: the plug-in accounted for 22,721 of the company's total 32,095 vehicle sales in April.

BYD's all-up share is not huge in a market which, according to Bloomberg, recorded a 26 per cent rise in passenger car sales through the first half of 2009 to 4.53 million.

But it has made some powerful friends. Charlie Munger, vice chairman at Warren Buffett's Berkshire Hathaway investment vehicle (and Buffett's closest business confidante), described it as "one of the most interesting small companies in the world".

Why? The answer bears the hallmark Buffett/Munger simplicity: "Battery technology is one of the most important subjects affecting the technological future of man."

Best known for putting its money where its mouth is, Berkshire took out a 225 million share stake in BYD in September 2008, at HK$8 a unit. By May this year, the value of that stake had risen from HK$1.8 billion to HK$9.66 billion.

How much of this can be attributed to Buffett's power to fulfil his and Munger's own prophecies? Some, no doubt. But this is also one of the world's largest lithium ion battery manufacturers.

BYD already supplies batteries for Motorola, Nokia, Samsung and LG among others, and the company is already working on hybrid battery packs for Volkswagen.

Like the power in the phones and cars, the power in the marketplace comes from the batteries.

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