By Krystal Hur and Alison Sider
Berkshire Hathaway can't seem to quit its love affair with airlines.
Warren Buffett had a tortured relationship with airline investments as the conglomerate's long-running chief executive and stock picker. Now his successor, Greg Abel, is showing an early fondness for them, too, with Berkshire taking a new $2.6 billion position in Delta Air Lines during the first quarter.
Buffett told The Wall Street Journal on Monday that he wasn't involved in Berkshire's new Delta position. But he said he gave other investment ideas to Abel, who took over as CEO in January and has oversight of the firm's enormous stock portfolio.
For many Buffett acolytes, the Delta stake conjures memories of the legendary investor's turbulent past with airlines. Buffett famously told The Telegraph in 2002 that he just couldn't help himself when it came to the boom-and-bust industry.
"I have an 800 number now that I call if I get the urge to buy an airline stock," he said at the time. "I call at two in the morning and I say: 'My name is Warren and I'm an aeroholic.' And then they talk me down."
It's possible Berkshire has exited from or changed its Delta position , since its regulatory filing last week disclosing the stake reflected investments in the first quarter. Berkshire declined to comment.
The airline industry is going through its latest challenge, with a huge run-up in the price of jet fuel because of the war in Iran. Spirit Airlines shut down earlier this month after the jump in fuel prices derailed its plans to emerge from a second bankruptcy. But Delta has led the industry's profits by focusing on affluent customers, and some investors are betting the carrier will increase its lead over rivals.
Buffett's trouble with airlines started in the late 1980s, when Berkshire's $358 million investment in USAir's preferred stock in 1989 quickly went south. While Berkshire managed to sell the shares for a gain in 1998, the company later went bankrupt twice. Buffett told shareholders in a 2007 letter that he had learned his lesson.
Airlines are "the worst sort of business" -- one that grows quickly and gobbles up cash while producing little or no profit, he wrote at the time.
"Here a durable competitive advantage has proven elusive ever since the days of the Wright Brothers," Buffett wrote.
But the lure proved too powerful, and Berkshire was back less than a decade later.
The firm bought big stakes in United Airlines, American Airlines, Delta and Southwest Airlines in 2016, betting that consolidation had tempered the industry's tendency for bruising fare wars that squeezed profits.
Airlines had "a bad first century," Buffett said to CNBC in 2017. "They're kind of like the Chicago Cubs. And they got that century out of the way, I hope."
But Berkshire's timing was off. It bought its big airline stakes when the industry was in the midst of a record-long streak of profits. Then it dumped its positions in 2020 when the Covid-19 pandemic ravaged demand for air travel, selling at a loss -- just before airline shares began to recover later that year.
Shares of Delta and United have jumped more than 170% since the end of April 2020, while Southwest has gained 23% through Monday's close, according to Dow Jones Market Data. American's stock has added 2.9%.
Berkshire's exit even drew criticism from President Trump. "Sometimes even someone like Warren Buffett -- I have a lot of respect for him -- they make mistakes," Trump said in June that year. "They should have kept the airline stocks."
Berkshire has maintained its interests in private aviation, which shares similar problems with public airlines, including high fixed costs such as fuel and unionized labor. The company bought private-jet operator NetJets in 1998 for about $725 million. Abel called it "a prized asset in a very tough industry" in his first letter to shareholders in February.
Airlines are once again in a precarious position.
The war in Iran sent oil prices soaring, and the price of fuel -- airlines' second-biggest expense -- doubled in a matter of weeks. Carriers have passed much of that along to consumers by raising fares, but analysts expect many to lose money this year.
Delta is better off than most. Its bet years ago that it could offer better, more reliable service and its focus on affluent customers has made it the most profitable U.S. carrier.
Chief Executive Ed Bastian welcomed the Berkshire news and said he had hoped the firm would become an investor again once the pandemic was in the rearview mirror.
"That was always one of my checklist things, to kind of get to the other side of this and see if there was a way that they would return," he told CNBC on Monday.
Write to Krystal Hur at krystal.hur@wsj.com and Alison Sider at alison.sider@wsj.com
(END) Dow Jones Newswires
May 19, 2026 12:18 ET (16:18 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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