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U.S. airlines posted considerable losses in the first quarter,
and are on track for a dismal second-quarter, as travel
restrictions and government-mandated lockdowns across the world
have brought demand to a virtual standstill.
"The world has changed" for the aviation industry," Buffett said
at Berkshire Hathaway's annual meeting on Saturday.
American Airlines <AAL.O> has posted a $2.2 billion net loss,
its first quarterly loss since emerging from bankruptcy in 2013,
while United Airlines <UAL.O> reported a loss of $1.7 billion
for its first quarter.
Shares in Delta Air Lines <DAL.N>, American Airlines, Southwest
Airlines Co <LUV.N> and United Airlines were all down between 8%
and 11% before the bell.
The S&P 1500 Airlines index <.SPCOMAIR> has lost 57.4% this
year, compared to a 12.4% decline in the broader S&P 500 <.SPX>.
Airline executives have warned of a slow recovery even after the
virus is contained and have said demand may not recover to 2019
levels for years.
Airlines in the United States have seen a near 95% drop in
domestic passengers and are now working to reassure customers
about the safety of air travel by instituting new cleaning and
social distancing procedures.
Berkshire Hathaway had held an 11% stake in Delta, 10% in
American, 10% in Southwest and 9% in United at the end of 2019,
according to its annual report and company filings.
(Reporting by Sanjana Shivdas in Bengaluru; Editing by Maju
Samuel)
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