Warren Buffett, the billionaire chief executive of Berkshire Hathaway, has sold off all his shares in US airlines as the industry loses billions and sheds tens of thousands of jobs.
Mr Buffett, whose conglomorate had avoided the airline industry but began building stakes in key carriers in 2016, told investors the sector looked set to “chew up” money as Berkshire Hathaway reported a $50bn (£40bn) net loss.
Berkshire Hathaway had built up shareholdings in four major airlines and was a top three shareholder after acquiring an 11pc stake in Delta, 10pc of American Airlines, 10pc of Southwest Airlines and 9pc of United Airlines. Mr Buffett said he expected each of the airlines would need to borrow more than $10bn to survive the crisis.
Berkshire Hathaway, which operates primarily as a holding company with shareholdings across sectors, warned most of its businesses had been negatively affected by the pandemic’s downturn.
Despite the downturn, the conglomorate’s cash pile swelled to $137bn. The company has been holding off on new acquisitions since the downturn, unlike during the 2008 financial crisis, when it went on a buying spree.
Analysts warned his unwillingness to invest suggested he believed the market had further to fall.
Berkshire Hathaway’s investor conference normally attracts tens of thousands of shareholders to its base in Omaha, Nebraska. This time, Mr Buffett, 89, addressed investors via video link.