Billionaire SELLS all stakes in US airlines amid coronavirus pandemic

The billionaire has admitted he made a mistake investing in the heavily damaged industry, which saw mass loss in profits this year.

Mr Buffet spoke at Berkshire Hathaway’s annual meeting where he announced the news.

He said: “We made that decision in terms of the airline business.

Great Big Lockdown Survey: Tell us what life’s like for you by answering THESE questions

“We took money out of the business basically even at a substantial loss.

“We will not fund a company… where we think that it is going to chew up money in the future.”

The multinational conglomerate based in Nebraska had previously held sizeable positions in the airlines.

According to the company’s listings, it held an 11 percent stake in Delta Air Lines, 10 percent of American Airlines Co, 10 percent of Southwest Airlines Co and a nine percent of United Airlines at the end of 2019.

The company was also one of the largest individual holders in the four airlines and in 2016 disclosed it had begun investing in the four carriers after avoiding the aviation sector for years.

Buffett said Berkshire had made the mistake of investing around $7 billion (£5.5bn) or $8 billion (£6.3bn) acquiring stakes in the four airlines.

He said: “We did not take out anything like $7 billion or $8 billion and that was my mistake.

“I am the one who made the decision.”

The billionaire investor said he had previously considered investing in additional airlines.

He added: “It is a blow to have essentially your demand dry up… it is basically that we shut off air travel in this country.”

Coronavirus BREAKTHROUGH: US officials say drug has ‘significant’ [INSIGHT]
US economic crisis: GDP shrinks 4.8% in biggest drop since 2008 crash [ANALYSIS]
Pug becomes first dog in the US to catch coronavirus [NEWS]

The coronavirus pandemic has led to airline stocks becoming deeply impacted by the near collapse of US travel demand as countries across the world remain in lockdown.

US airlines have cut hundreds of thousands of flights and parked their planes.

The demand for US travel fell by around 95 percent.

There is currently no clear timetable for when travel will return to pre-crisis levels.

US housing secretary Robert Jenrick said during a press conference on Saturday that the government wanted to support the aviation sector “in any way we can”.

He said the industry was “grappling with what the longer term demand for its services might be in an age in which social distancing will be important and in which business travel, for example, might be different”.

According to information from Dollar Flight Club given to the Express, airlines are set to lower airfare prices in the coming years by up to 35 percent to try and entice customers back.

These prices would then climb back 27 percent higher through to 2025.

Source: Read Full Article