Buffett Watch

Warren Buffett says United Airlines made a mistake in its initial response to dragged passenger

Key Points
  • Warren Buffett tells CNBC he wondered if United CEO Oscar Munoz had seen the video of David Dao being dragged from his seat.
  • "If so, Munoz's response "was a bigger mistake by far thathernn if he hadn't seen it," Buffett says.
Buffett: United made a mistake in initial response

Warren Buffett said Monday that United Airlines made a mistake in its initial response to the worldwide backlash over its treatment of a passenger.

Buffett, whose company has a stake in United, told CNBC he wondered if CEO Oscar Munoz had seen the video of passenger Dr. David Dao being dragged from his seat before making his response.

"If so, it was a bigger mistake by far than if he hadn't seen it. And I don't know the answer to that," the billionaire investor said on "Squawk Box." "But, the natural tendency if you've got 80,000 employees ... is to defend your employees."

Buffett said psychologically it can be hard for management to hear customers telling them they don't know how to do their jobs.

"A certain number people may behave badly. But what you hope is someone doesn't behave really badly," he said.

Buffett's comment came six days after Munoz appeared on Capitol Hill, where he apologized again for the forcible removal of Dao. Munoz at first supported the action.

The airline has since announced that Munoz will no longer take over as chairman of United's board in 2018, as planned. United will also offer passengers who give up their seats in an overbooked situation up to $10,000.

Monday's interview on CNBC came two days after Buffett addressed some 40,000 attendees at the CenturyLink Center in Omaha, Nebraska, the site of Berkshire Hathaway's annual meeting.

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**Buffett joins CNBC for three hours Monday morning until 9 a.m. ET.

—CNBC's Lauren Thomas and Fred Imbert contributed to this report.