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WHACKMASTER
03-18-2018, 08:47 AM
https://www.cnbc.com/2018/03/16/warren-buffetts-next-big-purchase-could-be-southwest-airlines-industry-analyst-speculates.html


Holy cow! They already own part of us but are contemplating purchasing the entire company. Please discuss possible implications.....


PowerShift
03-18-2018, 09:09 AM
https://www.cnbc.com/2018/03/16/warren-buffetts-next-big-purchase-could-be-southwest-airlines-industry-analyst-speculates.html


Holy cow! They already own part of us but are contemplating purchasing the entire company. Please discuss possible implications.....

Not good for the long term.

Tbpilot06
03-18-2018, 09:17 AM
Not good for the long term.

All you would have to do is look at how “successful” net jets js... this would be terrible for SWA


BarrySeal
03-18-2018, 09:25 AM
I would say NetJets is/was suffering from environmental problems prior to Buffett. How many Frax companies exist now ? XO Jet, Wheels Up, etc etc. Today the economy is booming and some folks who were "on the fence" on buying a plane or just buying a share, are buying a plane. The used aircraft market reflects this. Clean preowned planes are flying off the shelves like hot cakes. Those are all potential Frax owners who decided to be airplane owners.

I believe every company Buffett buys or invests in, sees its stock price go up strongly. This is a plus for 401(k) members and other shareholders.

https://www.usatoday.com/story/money/markets/2017/02/16/buffett-effect-buy-what-he-buys/97965132/ (https://www.usatoday.com/story/money/markets/2017/02/16/buffett-effect-buy-what-he-buys/97965132/)

Will be interesting to watch, but Buffett is not Gordon Gekko nor Frank Lorenzo. He typically buys stuff he believes in and holds for the long haul.

Tbpilot06
03-18-2018, 09:56 AM
I would say NetJets is/was suffering from environmental problems prior to Buffett. How many Frax companies exist now ? XO Jet, Wheels Up, etc etc. Today the economy is booming and some folks who were "on the fence" on buying a plane or just buying a share, are buying a plane. The used aircraft market reflects this. Clean preowned planes are flying off the shelves like hot cakes. Those are all potential Frax owners who decided to be airplane owners.

I believe every company Buffett buys or invests in, sees its stock price go up strongly. This is a plus for 401(k) members and other shareholders.

https://www.usatoday.com/story/money/markets/2017/02/16/buffett-effect-buy-what-he-buys/97965132/ (https://www.usatoday.com/story/money/markets/2017/02/16/buffett-effect-buy-what-he-buys/97965132/)

Will be interesting to watch, but Buffett is not Gordon Gekko nor Frank Lorenzo. He typically buys stuff he believes in and holds for the long haul.

True I was only looking at it from a pilots perspective not as an investor.

WHACKMASTER
03-18-2018, 10:03 AM
True I was only looking at it from a pilots perspective not as an investor.

Well, that is after all what perspective we are looking at it from. SWA will do just fine for many years to come with or without Buffett ownership.

I’m more concerned about him putting the screws to management to lower costs and increase revenue. It hasn’t been a good thing for NetJet pilots and I don’t want the same thing here. Fortunately, I understand that he’s pretty “hands off” when it comes to managing the companies he purchases.

Stitches
03-18-2018, 10:37 AM
I’m not worried. In the past WB has only commented on companies after he bought them. If he is planning a big purchase why drive up the price beforehand?

That said he’s pretty old and eats like the guy in Super Size Me so I don’t think he’ll be around much longer even if he did buy SWA.

tm602
03-18-2018, 03:12 PM
Please God no. SWA will suck as bad as NetJets. All our escapees will be roped right back into the hell of working for that money bloated S.O.B. again.

CA1900
03-18-2018, 03:52 PM
Well, that is after all what perspective we are looking at it from. SWA will do just fine for many years to come with or without Buffett ownership.

Imagine him buying SWA, firing Gary, stripping all evidence of Herb's existence from HQ, and putting the CEO of a power company at the helm. Because that's pretty much what he did at Netjets, and it has been an unmitigated disaster for the employees, the customers, and the company.

Fortunately, I understand that he’s pretty “hands off” when it comes to managing the companies he purchases.

That's what they say, but it's not really true. He puts people into leadership positions that do exactly what he wants, so he can keep up the "sweet old man" schtick. Don't believe it.

Ni hao
03-18-2018, 03:59 PM
He isn't the sweet old man that drinks cokes and goes to DQ. He is a shark and BH demands high returns.

Skyward
03-18-2018, 04:36 PM
Another reason why I keep my logbook current.

What can’t uber-rich old people just enjoy the money, retire and stop touching stuff...

rightseat
03-18-2018, 08:02 PM
Worth noting -- Southwest employees own about 15% of the stock and growing. Not enough to block him, but it could cost Berkshire a BUNCH to deal with such a voting block. Further, remember that Southwest isn't the only airline of which he owns a big chunk of stock and Southwest has ton of cash to ward off any unwanted advances for Berkshire.

Peacock
03-18-2018, 08:17 PM
It seems uncharacteristicly dumb of him to announce his intention to buy an airline before doing so.

Skyward
03-18-2018, 08:54 PM
From what I’ve read he just said last month that he wouldn’t rule out owning an entire airline, and it seems the analysts are speculating about which airline. They’re saying that SWA meets the criteria for a company that he typically likes to buy and so does DAL. SWA would be the better deal for him according to the analysts, but I am curious if he has any serious interest. I sure hope not!

It does seem like too much of a rookie move for him to mention a sector that he might be serious about buying only to make the purchase more expensive. Maybe he’s playing stock market games, slipping up in his old age or just talking with no real intentions.

Hopefully he’ll find somewhere else to spend money

Grumpyaviator
03-19-2018, 03:21 AM
And we’re the most organized company in one of the most organized industries, he and his yes men can’t do anything as far as pay and qol without us voting on it.

We’d be better without him, I’ll be prepared to go somewhere else.

tm602
03-19-2018, 10:31 AM
And we’re the most organized company in one of the most organized industries, he and his yes men can’t do anything as far as pay and qol without us voting on it.

We’d be better without him, I’ll be prepared to go somewhere else.

Every contract we've had in my nearly 14 years at NJA has been a long, ugly fight. The man hates organized labor, and has a very dim view on employees of his companies in general. After all, how many BK companies have ever been in the Top 50 Places To Work List?

RJSAviator76
03-19-2018, 12:49 PM
Uncle Warren, please go buy Delta. They have a fantastic airline and their own refinery and they have fantastic management, not to mention joint ventures and all that stuff that should make a capitalist such as yourself a very happy camper.

Jeff Lebowski
03-19-2018, 02:12 PM
I have it on good authority they're considering NetJets flow-throughs and a 10% discount on Justins for the entire pilot group.

tm602
03-19-2018, 02:31 PM
I wish. I really do. Except the boots.

T28driver
03-19-2018, 04:36 PM
I have it on good authority they're considering NetJets flow-throughs and a 10% discount on Justins for the entire pilot group.

All the cool kids wear Ariats these days.

Macjet
03-19-2018, 07:41 PM
Imagine him buying SWA, firing Gary, stripping all evidence of Herb's existence from HQ, and putting the CEO of a power company at the helm. Because that's pretty much what he did at Netjets, and it has been an unmitigated disaster for the employees, the customers, and the company.


Now multiply that by infinity, take that to the depth of forever, and you still will barely have a glimpse of what he's talking about.

Coincidently, I told more than one NK Captain who left for WN for the 'culture' that all of that could change overnight and I gave the exact same history lesson as above. For Southwest's sake I hope it's not true.

SimMonkey
03-22-2018, 04:00 PM
Imagine him buying SWA, firing Gary, stripping all evidence of Herb's existence from HQ, and putting the CEO of a power company at the helm. Because that's pretty much what he did at Netjets, and it has been an unmitigated disaster for the employees, the customers, and the company.

To continue the story:

Then shortly after the CEO of the power company coming under investigation by the SEC for some questionable dealings, promoting the UNION busting attorney brought on by said CEO, to become the new CEO of Netjets. His resume had: NO aviation experience, NO professioanl management experience, but he did work at daddy’s law firm for a few years. He did an awesome job destroying long term relations with the company. Think of a new Southwest CEO dumping 737’s and boeing all together. He was canned shortly before completely burning down the company. I mean “He wanted to spend more quality time with his family”.

Removing the CEO and founder of the company because of a one-time historical downturn in the economy, and replacing him with idiots with NO aviation background has forever soiled Netjets.

Today Netjets is just a shadow of its former self.

BarrySeal
03-22-2018, 07:38 PM
Imagine him buying SWA, firing Gary, stripping all evidence of Herb's existence from HQ, and putting the CEO of a power company at the helm. Because that's pretty much what he did at Netjets, and it has been an unmitigated disaster for the employees, the customers, and the company.

To continue the story:

Then shortly after the CEO of the power company coming under investigation by the SEC for some questionable dealings, promoting the UNION busting attorney brought on by said CEO, to become the new CEO of Netjets. His resume had: NO aviation experience, NO professioanl management experience, but he did work at daddy’s law firm for a few years. He did an awesome job destroying long term relations with the company. Think of a new Southwest CEO dumping 737’s and boeing all together. He was canned shortly before completely burning down the company. I mean “He wanted to spend more quality time with his family”.

Removing the CEO and founder of the company because of a one-time historical downturn in the economy, and replacing him with idiots with NO aviation background has forever soiled Netjets.

Today Netjets is just a shadow of its former self.

back to bed. some article written by some "expert" on the airline sector with speculation only. when Buffett buys SWA, we can worry about this then. Until then, back to regular programming.

Jeff Lebowski
03-23-2018, 01:07 PM
Today Netjets is just a shadow of its former self.

The entire fractional industry is a "shadow of its former self" and I don't think BH had much to do with it. The jets don't have the residual value they once had and that was the cornerstone of the model. Owners could cash out at the end of their contracts and thanks to depreciation and tax advantages they basically made money owning quarter shares. Now there's a glut of bizjets and managed-charter alternatives and they have eaten away at the fractionals big-time and I don't see the trend reversing itself.

The high water mark for fracs was 2007 and it's been in contraction mode ever since. I think if Uncle Warren had one do-over it would be his purchase of NetJets.

BarrySeal
03-23-2018, 08:22 PM
The entire fractional industry is a "shadow of its former self" and I don't think BH had much to do with it. The jets don't have the residual value they once had and that was the cornerstone of the model. Owners could cash out at the end of their contracts and thanks to depreciation and tax advantages they basically made money owning quarter shares. Now there's a glut of bizjets and managed-charter alternatives and they have eaten away at the fractionals big-time and I don't see the trend reversing itself.

The high water mark for fracs was 2007 and it's been in contraction mode ever since. I think if Uncle Warren had one do-over it would be his purchase of NetJets.

concur......

tm602
03-25-2018, 08:41 AM
back to bed. some article written by some "expert" on the airline sector with speculation only. when Buffett buys SWA, we can worry about this then. Until then, back to regular programming.

Wrong. This is exactly what happened at NJA. Been there 14 years. Saw it go from the best job in aviation to one I am doing everything I can to get away from, all with the change in one man. And this WAS in fact at the direction of BH.

Smooth at FL450
03-26-2018, 07:23 AM
Wrong. This is exactly what happened at NJA. Been there 14 years. Saw it go from the best job in aviation to one I am doing everything I can to get away from, all with the change in one man. And this WAS in fact at the direction of BH.

Did NetJets make any money from operating the aircraft? It was my understanding that the money was made on the mark-up and resale of shares at retail prices after negotiating massive volume discounts, and flying the airplanes wasn't a big generator of profits.

tm602
03-26-2018, 08:45 PM
Did NetJets make any money from operating the aircraft? It was my understanding that the money was made on the mark-up and resale of shares at retail prices after negotiating massive volume discounts, and flying the airplanes wasn't a big generator of profits.

Our whole revenue generating plan has changed. We are pretty much out of the buy and sell game and making most of our money on management fees, jet cards, and regular share owners.
This company has pretty much lost all its vision. Sure, we're taking deliveries but they are only to replace the ones headed out. Growth? Management is afraid of it.

Indyjetav8er
03-27-2018, 03:53 PM
concur......



Netjets profited from the accelerated depreciation of the aircraft. Not the the aircraft share holder. It says it in the contract you sign. When you leave the agreement you are subject to tax implications on a personal level not netjets. They are in the buy and sell game. The worse deal for any jet user is Netjets. It is a financial fleece with no advantages.




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THEKERNALKLINK
04-12-2018, 06:50 PM
Imagine him buying SWA, firing Gary, stripping all evidence of Herb's existence from HQ, and putting the CEO of a power company at the helm. Because that's pretty much what he did at Netjets, and it has been an unmitigated disaster for the employees, the customers, and the company.



That's what they say, but it's not really true. He puts people into leadership positions that do exactly what he wants, so he can keep up the "sweet old man" schtick. Don't believe it.

Their is already enough of a divide between the glorious cubicle commandos and the real world in the trenches people. This doesn't apply only to us, but everyone! I'm fairly certain this is the case through out all of Corporate America.

We ARE in the trenches. We have the education, and make money comparable with the corporate eggheads who have the office with an actual door and everything :) ... but we are very much in the thick of reality. I for one like that fact.