Warren Buffett says Berkshire Hathaway dumped all of its holdings in the airline sector, painting a grim picture of the industry that has been badly hurt by the COVID-19 pandemic.
“I was wrong about that business,” Buffett said, speaking on Saturday in Omaha, Neb., at Berkshire’s annual shareholder meeting, which was being held virtually due to the COVID-19 pandemic.
Back in April, Berkshire Hathaway BRK.A,
Subsidiaries of Berkshire sold 13 million Delta shares for a total of $ 314.2 million and 2.3 million Southwest shares amounting to more than $ 74 million, as he looked to substantially scale back his ownership of the airlines sector which has been devastated by stay-at-home protocols that have been put in place since the coronavirus epidemic took hold of the world over the past three months.
Buffett, however, explained that his company and its subsidiaries have unloaded their entire stake in airlines.
Buffett explained at the meeting that he thought he was getting roughly 10% of the four largest airlines for an attractive price. He also owned stakes in American Airlines Group Inc. AAL,
But he determined recently that his decision in light of the emerging pathogen as ill-advised and sought to trim his exposure“I just decided that I’d made a mistake.”
“The airline business, and I may be wrong, and I hope I’m wrong, changed in a major way,” he explained, noting that it has been through no fault of the CEOs of the companies. “I’ve been basically told not to fly,” he added, noting that he may not fly commercial going foward.
“I wouldn’t normally talk about it, but I think it requires an explanation,” he said of his decision to discuss selling airline stocks.
“We like those airlines but the world has changed …and I don’t know how it’s changed,” he said.
