BUSINESS BRIEFS
Fed extends its emergency loans into next year
Associated Press
WASHINGTON — Focused on getting the nation's credit gears smoothly working again, the Federal Reserve is letting Wall Street firms draw emergency loans into next year and giving financial companies more options to help them overcome credit problems.
The Fed's announcement yesterday marks its latest effort to get credit — the economy's oxygen — flowing more freely. A global credit crisis that erupted last August has hobbled the U.S. economy, already reeling from a housing meltdown.
As financial companies have racked up multibillion dollar losses on soured mortgage investments and credit problems spread to other areas, firms have hoarded cash and clamped down on lending. That has crimped spending by people and businesses, which in turn has weighed on the national economy — a vicious cycle the Fed wants desperately to break.
GM TO CUT 5,100 JOBS BY NOV. 1
DETROIT — General Motors Corp. plans to cut 15 percent of its U.S. and Canadian salaried workforce — or around 5,100 jobs — by Nov. 1 as part of a plan to slash billions of dollars and help the automaker ride out a slump in U.S. sales.
A GM official declined to confirm the specific numbers but indicated they were generally accurate. The official asked not to be named because the company had not planned to release the numbers until later.
Word of the cuts came two days before GM plans to release its second-quarter earnings. Analysts surveyed by Thomson Financial are predicting a loss of $2.63 per share amid plummeting truck and sport utility vehicle sales.
GM's sales outside North America grew 10 percent in the first half of this year thanks to strong growth in Russia, Brazil and other emerging markets. But it wasn't enough to keep Toyota Motor Corp. from taking the sales lead, or to offset losses at home.
UNITED SAYS PILOTS ABUSING SICK LEAVE
United Airlines yesterday asked a federal judge to stop four pilots and their union from abusing sick time and refusing to fly extra hours, saying illegal job actions have caused hundreds of cancellations.
The injunction request accuses the Air Line Pilots Association of encouraging a sick-out, which is not allowed under the Railway Labor Act, the labor law governing airlines. It also said pilots were refusing to pick up extra flying.
"ALPA's communications are essentially a guide describing how to use sick leave inappropriately," United's injunction request said. United said the first officers on its Boeing 737s and Airbus A320s called in sick the most. First officers on Boeing 737s called in sick more than twice as much over the past seven weeks versus the prior three years, and sick calls by Airbus 320 first officers rose 61 percent, the airline said.
United said it canceled 329 flights between July 19 and July 27, costing it about $8 million in revenue.
NISSAN WILL OFFER BUYOUTS TO 6,000
NASHVILLE, Tenn. — Nissan North America Inc. said yesterday it will offer buyouts to about 6,000 employees at the company's two Tennessee plants and eliminate a night shift at one plant because rising fuel prices and the economic downturn have slowed sales of trucks and sport utility vehicles.
The technicians and salaried employees at the assembly plant in Smyrna and powertrain plant in Decherd will be offered a lump sum of $100,000 or $125,000 depending on tenure, as well as medical and car purchase benefits.
Company spokesman Fred Standish said that even though the unit of Japan's Nissan Motor Co. is ending night shift truck production effective Aug. 11, it does not plan any layoffs.
"We've never laid off anybody in Smyrna and we don't intend to do it now," he said.
Standish said employees on the shift that is being eliminated are expected to either take buyouts or move into jobs made vacant from other workers taking the buyouts.
