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Immelt Pushes Harder to Shrink GE Capital

Thu, 23 May 2013 09:35:26 EDT

NEW YORK (TheStreet) -- General Electric has made great progress in shrinking GE Capital, and CEO Jeff Immelt on Tuesday said the company was considering spinoffs through public offerings as a way to meet its goals.

GE reported first-quarter operating earnings of $4.059 billion, or 39 cents a share, increasing from $3.567 billion, or 34 cents a share, during the first quarter of 2012. GE Capital contributed profit of $1.927 billion, or 47% of the parent company's operating earnings. Also see: GE Beats Estimates, Revenue Falls >>

Immelt has long stated that GE's goal is to grow its industrial earnings and shrink GE Capital sufficiently to have the conglomerate deriving 70% of earnings from its industrial business. ...

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Chrysler to Tesla: Not So Fast on Payback Claim

Thu, 23 May 2013 08:51:48 EDT

DETROIT (TheStreet) -- Tesla is calling itself "the only American car company to have fully repaid the government," but Chrysler said that's a stretch.

"Short memory or short-circuit?" asked Chrysler spokesman Gualberto Ranieri late Wednesday, on a company blog.

"The information is unmistakably incorrect," Ranieri wrote. "It's pretty well-known that almost exactly two years ago -- May 24, 2011 -- Chrysler Group LLC repaid (in full and with interest) U.S. and Canadian government loans more than six years ahead of schedule." ...

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Delta's JFK Jewel Pressures United at Newark

Thu, 23 May 2013 06:45:00 EDT

NEW YORK (TheStreet) -- Delta will open its new $1.4 billion John F. Kennedy terminal on Friday, strengthening its case to be considered New York's leading airline.

"We are and should be the preferred airline out of New York," said Gail Grimmett, Delta's senior vice president for New York. "We have a great hub out of LaGuardia, which is the preferred airport for local traffic, where we serve 48 of the top 50 business markets (all but Fayetteville and Oklahoma City) and now we have the international hub at JFK.

"But it's not just the breadth of network that's important," Grimmett added. "It's the customer service you get. It's the experience you get. It's the service on board that you get. One thing Delta has learned over the years is that you can never stop investing in the customer or the customer experience." ...

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United Dominates Newark, Thanks to People Express

Wed, 22 May 2013 06:45:00 EDT

NEWARK, N.J. (TheStreet) -- Twenty-five years ago Wednesday, Continental's move to Terminal C at Newark Airport marked the start of a new life for an old airport, which went from being the New York region's No. 3 airport to being its biggest hub.

Today United , which merged with Continental in 2010, offers more than 400 daily Newark departures to more than 150 destinations. United is celebrating a departure to Denver at 6:15 a.m. on May 22, 1988, the first flight from Terminal C. Aviation consultant Bob Mann said United wants to remind people of its presence before Friday, when Delta celebrates the opening of its new $1.4 billion terminal at John F. Kennedy International Airport.

At one time, JFK was home to Pan Am and TWA and had the vast majority of New York's international flights. LaGuardia was dominated by Eastern and Newark was home to People Express. The balance between airports began to change with the 1988 move, which was overseen by Bruce Nobles, then senior vice president of customer service for Continental. ...

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Carnival Shares Slip on Lower Guidance

Tue, 21 May 2013 09:31:09 EDT

MIAMI (TheStreet) -- Shares in Carnival were tumbling Tuesday after the company cut its guidance late Monday.

Minutes after the opening, shares were down $1.85 to $33.47. Carnival closed Monday at $35.32. Shares began the year at $37.25.

Analysts were reducing estimates. Robin Farley of UBS downgraded Carnival to neutral from buy, with a target price of $36, down from $38. The downgrade comes "after bad news has already happened, but our concern is that the worst is not behind Carnival just yet," Farley wrote. "Lower guidance (Monday) means bookings have gotten worse, not better, in the last few weeks. ...

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GE Capital to Pay $6.5 Billion Dividends to GE (Update 1)

Mon, 20 May 2013 11:23:27 EDT

8:09 a.m. ET with morning market action and comments from BernsteinResearch analyst Steven Winoker.

NEW YORK (TheStreet) -- GE Capital plans to churn out even more cash than it did last year.

The board of directors of General Electric's financial services subsidiary said on Monday it planned to pay the parent company a total of $6.5 billion in dividends during 2013, increasing from $6.4 billion during 2012. ...

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Virgin America: An Airline Sprouts in California

Mon, 20 May 2013 06:45:00 EDT

SAN FRANCISCO (TheStreet) -- The story of how Ben Baldanza, David Cush, Tom Horton and Doug Parker all worked together at American in the 1980s is well-known. Today, Horton is credited with guiding a successful bankruptcy, US Airways' Parker is about to run the world's biggest airline and Baldanza heads a successful start-up that has captured Wall Street's affections.

Then there is Cush. His success has come a bit more slowly. He left American in 2007 to become CEO of Virgin America. For 18 months, other airlines had resisted the start-up effort, citing lack of clarity about Richard Branson's ownership and the potential violation of the limitation on foreign ownership of U.S. carriers. Once it began flying, Virgin America encountered rising fuel prices, a bad economy and the usual intense competition on the trans-continental routes it initially targeted.

"We knew it was going to be a long path," Cush said in a recent interview. "Growing an airline is difficult in the best of times, and we haven't been in the best of times. We've had a huge recession and high commodity prices. We fought our way through those." ...

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US Airways Flight Attendants, Finally United, Look to the Next Merger

Thu, 16 May 2013 06:45:00 EDT

CHARLOTTE, N.C. (TheStreet) -- At a historic meeting on Wednesday, flight attendants from US Airways and America West formally merged their union chapters, nearly eight years after the two carriers merged, and prepared to step into another merger into a bigger airline where their union's future is at stake.

"It's a historic day," said Veda Shook, national president of the Association of Flight Attendants, who attended the meeting in Charlotte. "US Airways has been through this rodeo five times prior; it has had many successful mergers. And America West, (which) has been the little airline that could, is poised to take over and become the world's largest airline." The America West management team, headed by Doug Parker, is expected to run the merged carrier.

Roger Holmin, who was elected president of the merged US Airways AFA chapter, added: "We've been called 'east' and 'west' for eight years. Today is a milestone: We are one." The union will have local chapters in Charlotte, Philadelphia, Phoenix and Washington. The local presidents elected Holmin, who took office May 2, to fill out a term that runs through Dec. 31. Another election for a full term will take place this fall. ...

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US Airways: 'We'll Hit the Ground Running' After Merger

Wed, 15 May 2013 11:41:02 EDT

CHARLOTTE, N.C. (TheStreet) -- US Airways President Scott Kirby said the carrier can "hit the ground running" after its merger with American and reminded investors that is what happened following the 2005 merger of US Airways and America West.

Financially, "we came out screaming from day one" following the America West merger, Kirby recalled during an airline investor conference on Wednesday.

Asked whether the merger with American, which is expected to be in place in the third quarter, will face implementation problems, Kirby responded: "We know we won't be flawless but we think we'll do pretty well and we'll minimize the bumps in the road." ...

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IAM, TWU Agree to Join at Combined US Airways, American

Tue, 14 May 2013 14:36:30 EDT

CHARLOTTE, N.C. (TheStreet) -- The International Association of Machinists and the Transport Workers Union said they have agreed to jointly represent about 30,000 workers after the planned merger of US Airways and American .

The two unions would represent mechanic and related workers, fleet service workers and stores workers in a partnership to be known as the TWU/IAM Employee Association. They have asked the National Mediation Board to conduct elections among the combined employees for each group following the close of the merger, which is expected this year.

"I am proud that our two great unions put the members first in a true demonstration of solidarity," said Tom Buffenbarger, IAM international president, in a prepared statement. "These agreements protect our members' representation, pensions and seniority. Working jointly with the TWU, we will ensure both unions' members are rewarded in this merger." ...

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As Airbus A350 Rolls Out, US Airways Awaits a 2017 Delivery

Tue, 14 May 2013 09:49:57 EDT

CHARLOTTE, N.C. (TheStreet) -- Airbus rolled out the first A350 from the paint shop, perhaps positioning the European aircraft maker to take advantage of Boeing's long series of 787 problems.

The A350 is scheduled to fly for Qatar Airways by the end of 2014. US Airways , which operates the world's largest Airbus fleet, expects to take delivery of its first A350 in 2017, by which time it is expected to have merged with American .

US Airways is scheduled to receive four A350s in the fourth quarter of 2017 and four in 2018. The US Airways fleet includes 266 Airbus aircraft as well as 80 Boeing aircraft. Additionally, United has an existing order for 25 A350s, with deliveries to begin in 2016. ...

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United to Return Its Boeing 787s to Skies in Seven Days

Mon, 13 May 2013 12:34:36 EDT

CHICAGO (TheStreet) -- United said it will restart its Boeing 787 service next week.

The world's largest airline said it has scheduled 787 flights from Houston to other domestic hubs starting Monday, May 20. International service will restart June 10 with a Denver-Tokyo flight.

Boeing has already converted two of United's six Dreamliners to the new Federal Aviation Administration standards and will soon convert the others, the carrier said. "Our customers responded extremely well when we introduced the 787, and we know they'll welcome it back," said Pete McDonald, United's chief operations officer, in a prepared statement. ...

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GE Industrial Profit Will Grow by 10%: Oppenheimer

Mon, 13 May 2013 12:23:08 EDT

NEW YORK (TheStreet) -- General Electric has seen its stock lag the market a bit this year, but the company is on track to see profit from its industrial units grow by 10% in 2014, according to Oppenheimer analyst Christopher Glynn.

GE's shares closed at $22.90 Friday, returning 10% year-to-date, which trailed the stellar 15% returns for the Dow Jones Industrial Average and the S&P 500 Index .

The shares trade for 12.6 times the consensus 2014 earnings estimate of $1.82, among analysts polled by Thomson Reuters. ...

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Virgin America Cuts Losses and Sees IPO

Mon, 13 May 2013 11:02:22 EDT

SAN FRANCISCO (TheStreet) -- Virgin America said its losses are declining and it could stage an initial public offering as early as next year.

The San Francisco-based carrier, which is adding two new routes this month, has reduced losses after restructuring debt owed to the British company Virgin Group, and could stage an IPO in late 2014 or 2015, CEO David Cush said in an interview with The Associated Press.

In a filing with the U.S. Transportation Department, Virgin America said its 2012 net loss widened 45% to $145.4 million. However, its fourth-quarter loss narrowed to $25 million from $30.8 million in the same quarter a year earlier. In the first quarter of 2013, the loss narrowed to $46.4 million from $76 million. ...

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Assessing US Airways' Doug Parker's Legacy

Mon, 13 May 2013 06:45:00 EDT

CHARLOTTE, N.C. (TheStreet) -- Will US Airways CEO Doug Parker be remembered as a giant of commercial aviation?

Of course, it's too soon to tell. Over the next few years, as he oversees the merger of US Airways and American , which would create the world's biggest airline, Parker and his every move will be closely watched and continually assessed. Obviously, Parker is poised to establish himself as an aviation leader for the ages, but the events of the next few years will shape his legacy.

In an interview, Parker said that legacy should be largely about whether he can preserve jobs for the employees of US Airways and American. "What I care about is, by the time I'm done, I'd like the people at American and US Airways to know the company will be there for them," he said. "I'm highly confident we'll get there." ...

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