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The grounding of Boeing’s best-selling plane following two fatal crashes won’t “change the industry,” Berkshire Hathaway founder and CEO Warren Buffett said Thursday.
Buffett’s Berkshire Hathaway is among the largest shareholders in the four largest U.S. carriers, Delta Air Lines, United Airlines, Southwest Airlines and American Airlines.
The U.S. on March 13 joined dozens of other nations in grounding the popular Boeing aircraft following the crash of a months-old Boeing 737 Max 8 operated by Ethiopian Airlines shortly after takeoff from Addis Ababa. Investigators have said they found “clear similarities” between that crash and another of the same type of plane in Indonesia in October.
Boeing on Wednesday unveiled a series of updates to an anti-stall system that is a focus of investigations about the aircraft and recent crashes. The manufacturer did not tell pilots about the system before it flew.
“Obviously, Boeing has a lot of work to do very promptly,” Buffett said in an interview with CNBC’s Becky Quick. “That won’t change the industry over time or anything.”
Buffett said the airline industry’s safety record (there hasn’t been a fatal crash of a U.S. commercial passenger plane in more than a decade) has been so strong that it has pushed insurance rates lower.
“We happen to sell insurance also and the rates went down so far because the industry has been so safe,” he said.
Southwest has 34 of the 737 Max planes in its fleet of some 750 aircraft while American has 24 in its fleet of more than 950 planes. Both have warned travelers of cancellations due to the federally-mandated grounding of the aircraft.
