Why The Airlines Are Finally Profitable
By Adam Levine-Weinberg:Many investors are familiar with Warren Buffett's "feud" with the airlines. Buffett made a substantial investment in USAir (LCC) and quickly came to regret it; he has since refused to invest in commercial carriers (although Berkshire Hathaway does own NetJets, a fractional jet ownership company). Buffett has even gone so far as to say that capitalists should have shot down the Wright Brothers' plane to save themselves the agony of recurring airline bankruptcies! The airline industry has indeed incurred a sizable net loss since the airplane was invented. On the other hand, all of the major U.S. airlines with the exception of the troubled American Airlines (AMR) [this group includes United (UAL), Delta (DAL), US Airways, Southwest (LUV), JetBlue (JBLU), and Alaska (ALK)] have been profitable for the past two years, in spite of soft economic growth and high oil prices. These six carriers are expected to be profitable againComplete Story »
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