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Warren Buffett's $10 billion airline investment

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For the second time in six months, Warren Buffett's Berkshire Hathaway will invest billions of dollars into the US airline industry.

In total, Buffett's investment in American, Delta, United, and SouthwestAirlines totals nearly $10 billion.

It's indicative of the overall strength of the US airline industry and — from the perspective of consumer — the lack of product offerings.

Over the past decade, the landscape of the airline industry in the US has changed greatly. All four airlines have reported record profits, over the past two years.

In the year 2000, the sky was filled with names such as America West, US Airways, TWA, AirTran, Continental, ATA, and Northwest Airlines. By 2016, all of these brands had disappeared by being merged into or acquired by the Big Four.

American and US Airway's recently completed merger made the newly-combined company the largest airline in the world. Even though the new company will have to contend with cultural and operation differences, American's powerful and efficient domestic network makes it a formidable competitor.

All in all, the four largest airlines in the US, which also happen to be four largest in the world, are in a good place. Which is why all four warrant the investment from the Oracle of Omaha.


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