Stick to their knitting?

Airlines don’t have a glorious history of investing in other industries

Airlines have made some strange investments over the years, some of them difficult to link to the business of transporting people across the skies in big jets. For some inexplicable reason, for example, Japan Airlines once owned a dry cleaning business in Honolulu, though it dumped this sideline well before plunging into bankruptcy and having to be bailed out by a government cash handout.

Back in 2012 Delta Air Lines also did something strange. It bought an oil refinery. Admittedly, it was when oil prices were going through the roof – $90 a barrel at the time – and Delta’s management thought it should do something radical when its planes were burning the equivalent of 260,000 barrels a day, a third of total costs. Delta worked out that $2. 2 billion of the $12 billion a year it was spending on fuel was going to refiners as profit and by making jet fuel in the company’s own refinery, the airline figured it could keep some of that profit for itself. So it paid $180 million for an ageing refinery near Philadelphia.