airlineguy1234
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How much does Warren Buffett know about airlines?

Thu Mar 28, 2019 8:43 pm

I know Warren Buffett says that he does not invest in businesses he does not understand, so since he heavily invests in the airline industry, how much do you think he understands about airlines? Warren Buffett is a very smart guy, but airlines are so complex, how many people understand the intricacies of revenue management among the various other highly complex variables that an airline must deal with. The difference with Warren Buffett is that he is not only investing in airlines, so how much time do you think he could dedicate to learning about the industry and it's performance. There are people out there like Peter Belobaba and others at the MIT Airline Data Project who have dedicated a large part of their life to understanding revenue management. I am curious how much Buffett knows.
 
strfyr51
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Re: How much does Warren Buffett know about airlines?

Thu Mar 28, 2019 10:12 pm

airlineguy1234 wrote:
I know Warren Buffett says that he does not invest in businesses he does not understand, so since he heavily invests in the airline industry, how much do you think he understands about airlines? Warren Buffett is a very smart guy, but airlines are so complex, how many people understand the intricacies of revenue management among the various other highly complex variables that an airline must deal with. The difference with Warren Buffett is that he is not only investing in airlines, so how much time do you think he could dedicate to learning about the industry and it's performance. There are people out there like Peter Belobaba and others at the MIT Airline Data Project who have dedicated a large part of their life to understanding revenue management. I am curious how much Buffett knows.

what does he Need to know about airlines to invest? P/E ratio, Profit and Loss, and earnings to investment. Isn't that all most financiers know? He's not going to fly anything nor turn a wrench! He's a numbers man!
 
RDUDDJI
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Re: How much does Warren Buffett know about airlines?

Thu Mar 28, 2019 10:15 pm

Trust me, he's got peoples for that.
Sometimes we don't realize the good times when we're in them
 
MO11
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Re: How much does Warren Buffett know about airlines?

Thu Mar 28, 2019 10:32 pm

He owns NetJets. What else does he need?
 
AaronPGH
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Re: How much does Warren Buffett know about airlines?

Thu Mar 28, 2019 10:35 pm

Really makes u think
 
SXDFC
Posts: 1972
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Re: How much does Warren Buffett know about airlines?

Thu Mar 28, 2019 10:42 pm

RDUDDJI wrote:
Trust me, he's got peoples for that.


For free of charge, he has hundreds of people for that.. All he needs to do is create an account on here, and come up with a username and he will be with some of the finest CEOs of aviation.
 
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ODwyerPW
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Re: How much does Warren Buffett know about airlines?

Thu Mar 28, 2019 11:32 pm

SXDFC wrote:
RDUDDJI wrote:
Trust me, he's got peoples for that.


For free of charge, he has hundreds of people for that.. All he needs to do is create an account on here, and come up with a username and he will be with some of the finest CEOs of aviation.


Tru Dat!
learning never stops.
 
DDR
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Re: How much does Warren Buffett know about airlines?

Thu Mar 28, 2019 11:36 pm

SXDFC wrote:
RDUDDJI wrote:
Trust me, he's got peoples for that.


For free of charge, he has hundreds of people for that.. All he needs to do is create an account on here, and come up with a username and he will be with some of the finest CEOs of aviation.


God ain't that the truth!
 
b747400erf
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Re: How much does Warren Buffett know about airlines?

Thu Mar 28, 2019 11:49 pm

I am happy spring break is almost over an kids are going back to school. The internet has been a horrible place this month.
 
THS214
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Re: How much does Warren Buffett know about airlines?

Fri Mar 29, 2019 12:07 am

airlineguy1234 wrote:
I know Warren Buffett says that he does not invest in businesses he does not understand, so since he heavily invests in the airline industry, how much do you think he understands about airlines? Warren Buffett is a very smart guy, but airlines are so complex, how many people understand the intricacies of revenue management among the various other highly complex variables that an airline must deal with. The difference with Warren Buffett is that he is not only investing in airlines, so how much time do you think he could dedicate to learning about the industry and it's performance. There are people out there like Peter Belobaba and others at the MIT Airline Data Project who have dedicated a large part of their life to understanding revenue management. I am curious how much Buffett knows.


Warren Buffett only cares about money so he invest where he see profit not what he knows.When airline business was losing money he said those famous words. Then he bought Netjet. Look at Berkshire hathaway portfolio. Any airlines? Anyone think that Buffett knows all those businesses? Easiest way to make money is to fool people to believe you are right. Sorry... also make them believe in you.
 
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airportugal310
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Re: How much does Warren Buffett know about airlines?

Fri Mar 29, 2019 12:46 am

I don't understand why some people think airlines are some kind of special business that are so "complex" (borrowing OP words) that no can understand how they work. Every kind of business has its different intricacies...whether it be an airline, oil refinery, cruise ship, or (insert business name here)
“They bought their tickets, they knew what they were getting into. I say, let 'em crash.”
 
Boof02671
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Re: How much does Warren Buffett know about airlines?

Fri Mar 29, 2019 1:16 am

He knows in the early 90s he lost about $358 million in USAir
 
DarkKnight5
Posts: 195
Joined: Fri Apr 15, 2016 3:36 pm

Re: How much does Warren Buffett know about airlines?

Fri Mar 29, 2019 2:00 am

THS214 wrote:
airlineguy1234 wrote:
I know Warren Buffett says that he does not invest in businesses he does not understand, so since he heavily invests in the airline industry, how much do you think he understands about airlines? Warren Buffett is a very smart guy, but airlines are so complex, how many people understand the intricacies of revenue management among the various other highly complex variables that an airline must deal with. The difference with Warren Buffett is that he is not only investing in airlines, so how much time do you think he could dedicate to learning about the industry and it's performance. There are people out there like Peter Belobaba and others at the MIT Airline Data Project who have dedicated a large part of their life to understanding revenue management. I am curious how much Buffett knows.


Warren Buffett only cares about money so he invest where he see profit not what he knows.When airline business was losing money he said those famous words. Then he bought Netjet. Look at Berkshire hathaway portfolio. Any airlines? Anyone think that Buffett knows all those businesses? Easiest way to make money is to fool people to believe you are right. Sorry... also make them believe in you.

The way to make money is to know you can’t see the future, and then not overpay for shares in a company because that is how you create risk for yourself. And yes, Buffet uses his assets at Berkshire to study companies before buying, so he knows lots about their operations. He has made a few mistakes, even recently. Oracle, Kraft-Heinz if memory serves. It’s a game where you can’t help but have misses, because like my first sentence says you can’t see the future. That doesn’t mean you don’t understand a business or it’s operations.

Airlines are if a similar complexity to railroads or bus lines, over the road freight. More regulations sure, but all that does is drive up cost.
 
jetblueguy22
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Re: How much does Warren Buffett know about airlines?

Fri Mar 29, 2019 2:19 am

Warren Buffet is known for letting companies continue to run independently. I’m sure he gives his two cents, but they don’t get gobbled up into some conglomerate.

He doesn’t need to know everything about the airline business. He just has to hire people who are smarter than he is in the subject. A talent he has down pretty well judging by his track record.
Look at sweatpants guy. This is a 90 million dollar aircraft, not a Tallahassee strip club
 
1836Sam
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Re: How much does Warren Buffett know about airlines?

Fri Mar 29, 2019 2:26 am

Well he’s the one who coined the famous phrase isn’t he?
 
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TVNWZ
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Re: How much does Warren Buffett know about airlines?

Fri Mar 29, 2019 2:53 am

jetblueguy22 wrote:
Warren Buffet is known for letting companies continue to run independently. I’m sure he gives his two cents, but they don’t get gobbled up into some conglomerate.


His company IS a conglomerate.
 
jetblueguy22
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Re: How much does Warren Buffett know about airlines?

Fri Mar 29, 2019 5:03 am

TVNWZ wrote:
jetblueguy22 wrote:
Warren Buffet is known for letting companies continue to run independently. I’m sure he gives his two cents, but they don’t get gobbled up into some conglomerate.


His company IS a conglomerate.

Fair, I should have used a better term.
Look at sweatpants guy. This is a 90 million dollar aircraft, not a Tallahassee strip club
 
sandyb123
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Re: How much does Warren Buffett know about airlines?

Fri Mar 29, 2019 8:56 am

jetblueguy22 wrote:
Fair, I should have used a better term.


"Investment vehicle" ;-)

Sandyb123
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c933103
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Re: How much does Warren Buffett know about airlines?

Fri Mar 29, 2019 9:59 am

Why would someone need to understand revenue management before investing into airlines? Those revenue management departments aren't getting paid for nothing
Peace cannot counter violence when violence are being used by the powerful without mercy. #HongKong
But there is one possible exception. That is if the world could come together and make those who use violence lose their power. #China
 
frmrCapCadet
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Re: How much does Warren Buffett know about airlines?

Fri Mar 29, 2019 2:01 pm

Their* mantra is to buy or buy into well-managed companies that are under valued. BRK owns machine shops (?) that make parts, but has not until recently owned airline stock. I believe now they own shares in the big 3 and WN. I have taken that to confirm that current configuration of the US airline environment is profitable. I doubt that BRK will ever buy out any particular airline.

*Berkshire Hathaway, BRK shares are A or B
Buffet: the airline business...has eaten up capital...like..no other (business)
 
MIflyer12
Posts: 6073
Joined: Mon Feb 18, 2013 11:58 pm

Re: How much does Warren Buffett know about airlines?

Fri Mar 29, 2019 3:18 pm

RDUDDJI wrote:
Trust me, he's got peoples for that.


What did he know about carbonated beverages, ice cream, insurance, paint, home building, or trains? He seems to do pretty well! Yes, he's got people for that.
 
THS214
Posts: 234
Joined: Thu Jul 27, 2017 4:01 pm

Re: How much does Warren Buffett know about airlines?

Sat Mar 30, 2019 5:49 pm

DarkKnight5 wrote:
THS214 wrote:
airlineguy1234 wrote:
I know Warren Buffett says that he does not invest in businesses he does not understand, so since he heavily invests in the airline industry, how much do you think he understands about airlines? Warren Buffett is a very smart guy, but airlines are so complex, how many people understand the intricacies of revenue management among the various other highly complex variables that an airline must deal with. The difference with Warren Buffett is that he is not only investing in airlines, so how much time do you think he could dedicate to learning about the industry and it's performance. There are people out there like Peter Belobaba and others at the MIT Airline Data Project who have dedicated a large part of their life to understanding revenue management. I am curious how much Buffett knows.


Warren Buffett only cares about money so he invest where he see profit not what he knows.When airline business was losing money he said those famous words. Then he bought Netjet. Look at Berkshire hathaway portfolio. Any airlines? Anyone think that Buffett knows all those businesses? Easiest way to make money is to fool people to believe you are right. Sorry... also make them believe in you.

The way to make money is to know you can’t see the future, and then not overpay for shares in a company because that is how you create risk for yourself. And yes, Buffet uses his assets at Berkshire to study companies before buying, so he knows lots about their operations. He has made a few mistakes, even recently. Oracle, Kraft-Heinz if memory serves. It’s a game where you can’t help but have misses, because like my first sentence says you can’t see the future. That doesn’t mean you don’t understand a business or it’s operations.

Airlines are if a similar complexity to railroads or bus lines, over the road freight. More regulations sure, but all that does is drive up cost.


True. What I tried to say is what someone has said decades ago might have changed, like aviation. So has his knowledge.
 
IPFreely
Posts: 2447
Joined: Sun Dec 24, 2006 8:26 am

Re: How much does Warren Buffett know about airlines?

Sat Mar 30, 2019 7:26 pm

MIflyer12 wrote:
What did he know about carbonated beverages


According to this article (and others), he drinks at least half a gallon of carbonated beverages every day.

https://www.cnbc.com/2018/02/09/heres-w ... o-eat.html
 
Woofbite
Posts: 18
Joined: Tue Nov 29, 2016 12:02 pm

Re: How much does Warren Buffett know about airlines?

Sun Mar 31, 2019 12:32 pm

He knows a lot more about airlines now than he used to. Here's his quotes on buying US Air preferred stock:

“When Richard Branson, the wealthy owner of Virgin Atlantic Airways, was asked how to become a millionaire, he had a quick answer: 'There's really nothing to it. Start as a billionaire and then buy an airline.' Unwilling to accept Branson's proposition on faith, your Chairman decided in 1989 to test it by investing $358 million in a 9.25% preferred stock of USAir.

I liked and admired Ed Colodny, the company's then-CEO, and I still do. But my analysis of USAir's business was both superficial and wrong. I was so beguiled by the company's long history of profitable operations, and by the protection that ownership of a senior security seemingly offered me, that I overlooked the crucial point: USAir's revenues would increasingly feel the effects of an unregulated, fiercely-competitive market whereas its cost structure was a holdover from the days when regulation protected profits. These costs, if left unchecked, portended disaster, however reassuring the airline's past record might be.

….

In another context, a friend once asked me: 'If you're so rich, why aren't you smart?' After reviewing my sorry performance with USAir, you may conclude he had a point."
 
texdravid
Posts: 1814
Joined: Fri May 14, 2004 3:21 pm

Re: How much does Warren Buffett know about airlines?

Sun Mar 31, 2019 4:36 pm

Less than Trump.....
Tort reform now. Throw lawyers in jail later.
 
Boof02671
Posts: 1626
Joined: Sun Jul 10, 2016 12:15 am

Re: How much does Warren Buffett know about airlines?

Sun Mar 31, 2019 4:50 pm

texdravid wrote:
Less than Trump.....

Nothing to do with the topic snd Trump lost his airline.
 
texdravid
Posts: 1814
Joined: Fri May 14, 2004 3:21 pm

Re: How much does Warren Buffett know about airlines?

Sun Mar 31, 2019 11:09 pm

Everything to do with it and his knowledge of how Air Force 1 742’s being wasteful was right on and his criticisms of Boeing right on so yes absolutely yes he knows more than the usual liberal billionaires like Buffet
Tort reform now. Throw lawyers in jail later.

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