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Billionaire investor Warren Buffett says his Berkshire Hathaway company has sold all of its shares in the four largest airlines in the United States.
Warren Buffett started investing in the airline industry four years ago, and now he says it was a mistake.
Photo: AFP
Speaking at the annual shareholders meeting, Buffett said “the world has changed” due to the coronavirus.
Then he said he had been wrong to invest in the airline industry.
Buffett’s comments came just hours after Berkshire Hathaway announced a record net loss of $ 50 billion ($ NZ82.4b) in the first quarter, the Reuters news agency reports.
The conglomerate had an 11 percent stake in Delta Air Lines, 10 percent in American Airlines, 10 percent in Southwest Airlines, and 9 percent in United Airlines, according to its annual report and company filings.
The firm began investing in all four airlines in 2016, after avoiding the aviation industry for years.
Delta Air Lines planes parked at a logistics airport in Southern California.
Photo: AFP
Buffett says that nothing can stop the United States. USA
Buffett said at the meeting, which was virtually held: “We made that decision in terms of the airline’s business. We basically made money out of the business even with a substantial loss.”
“We will not finance a company … where we believe it will chew money in the future.”
The US travel industry USA It has nearly collapsed as a result of the coronavirus pandemic, with airlines cutting hundreds of thousands of flights and taking thousands of planes out of service.
Buffett said he had been considering investing in additional airlines before the pandemic.
“It is a shock to have, essentially, its demand dry,” he said. “Basically, we cut air travel in this country.”
Illustrating his comments with dozens of black and white slides, Buffett called dealing with the pandemic “a great experiment” that had an “extraordinarily wide” range of possible economic outcomes.
But he said that Americans have persevered and thrived through crises like the Civil War in the 1860s, the flu pandemic a century ago, and the Great Depression. American “magic” prevailed before and would do so again, he said.
“Nothing can stop the United States when you do it,” Buffett said. “I will bet on the United States for the rest of my life.”
In a statement, Delta said it was aware of the sale and that it has “tremendous respect for Buffett and the Berkshire team.”
The airline added that it remains “confident” in its strengths.
– BBC / Reuters
