Electric vehicle sales are soaring. So why is Warren Buffett selling?

By Trey Thoelcke Updated May 10, 10:11AM EDT · Published May 10, 4:10AM EDT

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Electric vehicle sales are soaring. So why is Warren Buffett selling? — © jetcityimage / iStock Editorial via Getty Images

In today’s edition:

— Electric vehicles sales are soaring. EV stocks, not so much.

— Investing in impact startups dropped last month as recession fears rose

— As the market for electric vehicles booms, another comes along for the ride — tires

— The carbon emissions from gold mining are staggering

— Locus Technologies secures big new cloud software deal as demand for ESG tools grows

One of the biggest stories in renewable energy this spring is the surge in electric vehicle sales worldwide, with China, Europe and even the U.S. seeing demand that far exceeds expectations. But not so much on the EV stocks side.

Three of the biggest startup names in electric vehicles in the U.S. — Rivian $RIVN , Fisker $FSR and Lucid Motors $LCID have all continued to slump as production delays and supply chain problems prevent them from generating the critical mass of new product needed to compete with the big boys such as Ford $F and General Motors $GM . All three report earnings this week and, so far, investors have been disappointed.

Whenever a new industry takes off, some of the early startup stars fall by the wayside, but it looks like changing global economic and geopolitical conditions might be affecting the big boys, too. Warren Buffett, who nobody takes for a climate enthusiast, has been selling his decade-old stake in Chinese EV maker BYD for the past six months. He sold another 2 million shares last week, according to the South China Morning Post, bringing total sales to about 100 million shares, or half his stake.

The latest sale comes as BYD has fallen by a third in value this year, despite headlines showing it dominating EV sales in China. It is now bigger than Tesla $TSLA . Over the Covid era, the stock surged sixfold. So perhaps Buffett is simply taking profit. Or perhaps he’s more worried about investing in China these days, something he hinted about over the past weekend at his annual weekend wisdom-fest in Omaha.

Either way, the weakness in EV stocks at a time when demand is growing is a troubling indicator of economic road bumps to come, and a sign that the road to success in the fledgling EV industry isn’t going to be a one-way street. Investors in batteries, tires, charging stations, and other EV offshoots take notice.

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About the Author Trey Thoelcke →

Trey has been an editor and author at 24/7 Wall St. for more than a decade, where he has published thousands of articles analyzing corporate earnings, dividend stocks, short interest, insider buying, private equity, and market trends. His comprehensive coverage spans the full spectrum of financial markets, from blue-chip stalwarts to emerging growth companies.

Beyond 24/7 Wall St., Trey has created and edited financial content for Benzinga and AOL's BloggingStocks, contributing additional hundreds of articles to the investment community. He previously oversaw the 24/7 Climate Insights site, managing editorial operations and content strategy, and currently oversees and creates content for My Investing News.

Trey's editorial expertise extends across multiple publishing environments. He served as production editor at Dearborn Financial Publishing and development editor at Kaplan, where he helped shape financial education materials. Earlier in his career, he worked as a writer-producer at SVE. His freelance editing portfolio includes work for prestigious clients such as Sage Publications, Rand McNally, the Institute for Supply Management, the American Library Association, Eggplant Literary Productions, and Spiegel.

Outside of financial journalism, Trey writes fiction and has been an active member of the writing community for years, overseeing a long-running critique group and moderating workshop sessions at regional conventions. He lives with his family in an old house in the Midwest.