uh, uh, uh, never thought FLOPS would essentially buy RTA. Watching the world economy unfold, anything can happen.
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Berkshire Letter to Shareholders
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uh, uh, uh, never thought FLOPS would essentially buy RTA. Watching the world economy unfold, anything can happen.
Partial Transcript from CNBC interview this morning-
BUFFETT: Yeah, he's doing it really well. The situation with NetJets, and this is true both in Europe and the United States, is the number of planes owned by our owners is down maybe 15 percent or so. Now it's stabilized in the last few months. I mean, the number of people that are getting rid of their fractional ownership is being matched by new ones. The interesting thing is, flying per owner fell off dramatically a little over a year ago. I mean, when the recession hit, our owners, even though they'd already--they were paying for the hours, they were paying the management fee, when Thanksgiving came, when Christmas came, whatever it might be, when the Kentucky Derby came, the--their flying fell off quite dramatically, maybe by 25 percent. And like I say, they were paying the management fee anyway. That has come back a fair amount in the last couple of months. Flying per owner has increased somewhat. NetJets is, actually, as I put in the report, solidly profitable now. What Dave has done there has been miraculous. I mean, he is--he went--he went in there of August of last year and in terms of getting the balance sheet straightened out, our debt is down $500 million in terms of getting our operating costs in line with revenues. In all respects, NetJets is working very well now. But you're right, there are--compared to five years ago, or four years ago, you know, we're not seeing the same demand as we did then. And like I say, it's about equal in Europe and the United States.
QUICK: Hey, Warren, just on that point, we have a note that came in from one of the shareholders, one of their questions from Jack Harris in Rome City, Indiana. It's number 42, guys, in the control room if you want to follow. On that point he says, "With NetJets losing about three quarters of a billion dollars last year, this company to me really doesn't fit the Berkshire mold. What's the future of NetJets? Is there a chance that in the future you would sell the company?"
BUFFETT: No, we will not sell the company. And it's true that our guarantee of their debt is what kept them alive last year, and--but I don't see any reason why NetJets, unless private aviation was banned in some way or something, but I see no reason--NetJets is going to make money and it makes money even during a period like this when sale of planes are not very high. So it is by far the dominant factor in the--in the business. It has--the value of its fleet is well over that of the next three competitors combined. So we own the business, in effect. We're--and it's a profitable business. It just got out of control a year ago and it has this huge loss. The year before that it was profitable.
BUFFETT: Yeah, he's doing it really well. The situation with NetJets, and this is true both in Europe and the United States, is the number of planes owned by our owners is down maybe 15 percent or so. Now it's stabilized in the last few months. I mean, the number of people that are getting rid of their fractional ownership is being matched by new ones. The interesting thing is, flying per owner fell off dramatically a little over a year ago. I mean, when the recession hit, our owners, even though they'd already--they were paying for the hours, they were paying the management fee, when Thanksgiving came, when Christmas came, whatever it might be, when the Kentucky Derby came, the--their flying fell off quite dramatically, maybe by 25 percent. And like I say, they were paying the management fee anyway. That has come back a fair amount in the last couple of months. Flying per owner has increased somewhat. NetJets is, actually, as I put in the report, solidly profitable now. What Dave has done there has been miraculous. I mean, he is--he went--he went in there of August of last year and in terms of getting the balance sheet straightened out, our debt is down $500 million in terms of getting our operating costs in line with revenues. In all respects, NetJets is working very well now. But you're right, there are--compared to five years ago, or four years ago, you know, we're not seeing the same demand as we did then. And like I say, it's about equal in Europe and the United States.
QUICK: Hey, Warren, just on that point, we have a note that came in from one of the shareholders, one of their questions from Jack Harris in Rome City, Indiana. It's number 42, guys, in the control room if you want to follow. On that point he says, "With NetJets losing about three quarters of a billion dollars last year, this company to me really doesn't fit the Berkshire mold. What's the future of NetJets? Is there a chance that in the future you would sell the company?"
BUFFETT: No, we will not sell the company. And it's true that our guarantee of their debt is what kept them alive last year, and--but I don't see any reason why NetJets, unless private aviation was banned in some way or something, but I see no reason--NetJets is going to make money and it makes money even during a period like this when sale of planes are not very high. So it is by far the dominant factor in the--in the business. It has--the value of its fleet is well over that of the next three competitors combined. So we own the business, in effect. We're--and it's a profitable business. It just got out of control a year ago and it has this huge loss. The year before that it was profitable.
HazMat
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gutshotdraw
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The Burlington railway deal is a far greater risk to Berkshire than Netjets. Mr. B referred to it as an "all-in" bet on the U.S. economy.
I think Mr. S is doing a great job but people in the company also know it wasn't tough to cut out the first couple hundred million in stoooopid spending that has been going on for a couple years. The Netjets showing for the rest of this year and 2011 will be the challenge. Personally, I like the odds.
I think Mr. S is doing a great job but people in the company also know it wasn't tough to cut out the first couple hundred million in stoooopid spending that has been going on for a couple years. The Netjets showing for the rest of this year and 2011 will be the challenge. Personally, I like the odds.
I think he got the company cheap.
To paraphrase one of his quotes,
When its raining gold you use buckets not thimbles.
Mr. S will be doing a great job when we're all back to work. Until then I look at my bank account and think of that son of a bitch along with Buffett and RTS.
Even after we get back I'll get to look at my retirement fund and savings as a souvenir of all this mess. Unless I can miraculously figure out a way to turn back time and stay out of aviation, this is going to have some permanent sting to my family's finances.
Even after we get back I'll get to look at my retirement fund and savings as a souvenir of all this mess. Unless I can miraculously figure out a way to turn back time and stay out of aviation, this is going to have some permanent sting to my family's finances.
HazMat
Well-known member
- Joined
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- 192
jppt2000 stated:
Just so you know:
Buffett made a nice profit on the preferred USAIR stock he held onto about 10 years later.
Another Netjets hater.
Maybe you should put on your tagline, Fly Avantair!
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Warren Buffett, Airlines Hasn’t Always Been a Successful Marriage
Posted: Jan. 22, 2008
RESEARCH TRIANGLE PARK – Suffice it to say that Warren Buffett has had a love and hate relationship with airlines.
His NetJets fleet of private jets for the world’s elite is flourishing, and that airline could be moving major parts of its operations to North Carolina.
However, Buffett certainly will never forget the $385 million investment he made in US Air. In 1995, he wrote off 75 percent of that investment during one of the many upheavals that make airline investments adventures into the unknown.
http://www.airliners.net/aviation-forums/general_aviation/read.main/3810132/
I am not a NetJets hater at all and I apologize if that is how you interpreted my comments.
We should all want everyone in our industry to thrive and prosper because that equates to jobs and security for all of us.
When our peers at other operators are impacted by the current economic climate that we are operating in, it can and does affect all of us.
When a prospective Owner is reluctant to purchase any of our products due to negative news from any operator, it can impact all of our bottom lines, it's that simple.
I would hope that there isn’t anyone on this message board (already maybe one)that takes any pleasure in the misfortunes of others.
Like it or not, we are all in this together.
Just so you know:
Buffett made a nice profit on the preferred USAIR stock he held onto about 10 years later.
Another Netjets hater.
Maybe you should put on your tagline, Fly Avantair!
-------------------------------------------------------------------------------------------------------------------------------------
Warren Buffett, Airlines Hasn’t Always Been a Successful Marriage
Posted: Jan. 22, 2008
RESEARCH TRIANGLE PARK – Suffice it to say that Warren Buffett has had a love and hate relationship with airlines.
His NetJets fleet of private jets for the world’s elite is flourishing, and that airline could be moving major parts of its operations to North Carolina.
However, Buffett certainly will never forget the $385 million investment he made in US Air. In 1995, he wrote off 75 percent of that investment during one of the many upheavals that make airline investments adventures into the unknown.
http://www.airliners.net/aviation-forums/general_aviation/read.main/3810132/
I am not a NetJets hater at all and I apologize if that is how you interpreted my comments.
We should all want everyone in our industry to thrive and prosper because that equates to jobs and security for all of us.
When our peers at other operators are impacted by the current economic climate that we are operating in, it can and does affect all of us.
When a prospective Owner is reluctant to purchase any of our products due to negative news from any operator, it can impact all of our bottom lines, it's that simple.
I would hope that there isn’t anyone on this message board (already maybe one)that takes any pleasure in the misfortunes of others.
Like it or not, we are all in this together.
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