Gst, I love a person who will admit to making a mistake.
Maybe, some day the new economy boys will learn to do the same.
Thursday, March 29, 2001, 12:00 a.m. Pacific
Buffett says he has sworn off airline stocks
by Andrea Rothman
Bloomberg News
PARIS - Billionaire investor Warren Buffett said he has sworn off investing in airline stocks since his $358 million "mistake" in US Airways Group.
"Now if I get the urge to invest in airlines, I call an 800 number, and I say: 'Hello, my name is Warren, and I'm an air-o-holic,'" he said. "Sometimes, it takes them 10 minutes to talk me out of it, sometimes more."
The 70-year-old chairman and chief executive of Berkshire Hathaway said in 1996 that the purchase was a mistake. Berkshire acquired the stake in the form of preferred stock for $358 million in 1989. It has since sold the stake, later converted to common shares, without saying whether it made money.
Buffett told journalists aboard a London-to-Paris flight yesterday that 130 U.S. airlines have gone broke in the past 20 years. "It's unbelievable," he said, offering to dig out a list of the failed companies he keeps back in his office in Omaha to show doubters.
"The airline business from the time of Wilbur and Orville Wright through 1991 made zero money, net," he said. "If capitalists had been present at Kitty Hawk when the Wright brothers' plane first took off, they should have shot it down."
Buffett had invited the journalists on the trip aboard a Boeing business jet to discuss Executive Jet, a Berkshire Hathaway company that sells partial shares in business planes.
He also shared his views on the airline industry, particularly on Southwest Airlines: It's the world's largest low-fare airline and has the largest market value, $13.7 billion, of any airline company.
"Southwest is a fabulous business," he said, and its chief executive and founder, Herb Kelleher, is "right up there with Sam Walton," the founder of Wal-Mart Stores, the world's largest retailer. Still, Buffett has vowed not to buy another airline stock. |
