Business & Finance
As part of aggressive cost-cutting by American Airlines, the struggling carrier said it will reinstall coach seats on some planes that were removed for a promotional campaign - a change that will allow it to sell more low-fare tickets. Among other measures, American said it also plans to further reduce capacity and to renegotiate multimillion-dollar naming-rights contracts for sports arenas in Dallas and Miami.
Bankrupt Air Canada served notice that another deep round of job cuts is necessary if it's to survive. In a meeting with union leaders Wednesday in Toronto, carrier president Robert Milton put the number at 7,100, the National Post reported. In March, Air Canada announced 3,600 layoffs and asked most of its employees to take a temporary 10 percent pay cut and work longer hours. The unions have until Tuesday to reply to that request.
Siemens, the engineering and electronics giant, surprised analysts by announcing it will sell $2.9 billion worth of convertible bonds. The move triggered speculation that the German conglomerate is preparing for a new round of acquisitions because it otherwise "isn't desperate for cash," one analyst told the Bloomberg.com financial reporting service. Siemens reportedly has been eyeing Invensys PLC, a world leader in the manufacture of industrial controls and automation systems, which is attempting to sell off some assets to cut debt. Last month, Siemens agreed to pay $1.2 billion for the industrial turbines division of French engineering conglomerate Alstom.
Energy wholesaler Aquila Inc. has agreed to sell a subsidiary in Britain for $1.8 billion to fast-growing electricity network owner Scottish & Southern PLC, the latter said. Aquila's Sterling Ltd. unit owns Midlands Electricity, the fourth-largest supplier of power in England and Wales. Scottish & Southern also is acquiring a lighting-services and a metering/data-collection company. Aquila, based in Kansas City, reported a $51.9 million first-quarter loss. It is leaving the energy-trading sector to refocus on operating utilities in the US, its core business.
DaimlerChrysler will not build a $1 billion assembly plant in Windsor, Ontario, after all, its president announced. Dieter Zetsche cited "a formidable hurdle" to demand for the "small entry-level vehicle" that would have been produced there. Plans for the plant were unveiled last fall. Earlier this month the Canadian Auto Workers Union said it still expected the plan to go forward.