Bill Franke Will Keep Airbus Nervous
The veteran investor sounded off last week on several topics, including why his Canadian startup flies Boeing’s 737 Max.
The finance world hangs on Warren Buffett's every word. Airlines have their own revered voice in legendary investor Bill Franke, the octogenarian chairman of Indigo Partners, the private equity firm that owns pieces of Volaris, Cebu Pacific, Wizz Air, Frontier and other discount carriers. Franke probably has made more money in airlines than any other private investor because he understands cost control.
Franke spoke last week at the CAPA Americas Summit in Ontario, California, and as usual, he spoke his mind. He told the audience why he refused to overpay for Spirit Airlines, and how Airbus reacted when he placed a mammoth order on behalf of several portfolio airlines. He also discussed how the post-Covid recovery might not be as strong as airline executives say publicly. And he took a swing at Airbus and Boeing, saying their delivery delays may not subside soon.
Here are the highlights.
The recovery is very choppy
I warned you that U.S airline executives would brag about record sales days during their recent earnings calls, while saying little — or nothing — about weaker trends. And that's exactly what many of them did.
Franke, who said he speaks to his airline executives every day, said his portfolio airlines are having some monster sales days. But he gave more context, saying not all days, even within the same month, are so rosy.
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