Ted Reed

AMR/US Airways Deal Faces Pilot Seniority Hassles

twocents@thestreet.com (Ted Reed) — Wed, 16 May 2012 11:35 GMT

CHARLOTTE, N.C. (TheStreet) -- The odds may appear to favor a merger between AMR and US Airways, but that isn't to say that a merger would provide an easy solution to the accompanying pilot seniority integration problems.

In fact, it is difficult to imagine more complexities than those involved in integrating two pilot groups from two different unions, each of which includes angry minorities of pilots who have filed lawsuits contesting the seniority practices pursued in two previous mergers.

In 2001, American merged with TWA. The TWA pilots, who felt they were badly treated in the subsequent seniority integration, have continued to object in various forums. In 2005, US Airways merged with America West. An arbitrator issued a controversial seniority ruling so troubling to the majority of the pilots that rather than implement it, they left one union and formed another. That resulted in a series of suits. ...

Click to view a price quote on AMMRQ.PK.

Warren Buffett's Latest Bet on America Is GM

twocents@thestreet.com (Ted Reed) — Tue, 15 May 2012 21:38 GMT

DETROIT (TheStreet) -- Warren Buffett, famous for his bets on the U.S. economy and eternal optimism about this country's future, has become a buyer of one of the nation's biggest market symbols, auto maker GM .

Buffett's Berkshire Hathaway disclosed in its quarterly portfolio holdings filing with the Securities and Exchange Commission on Tuesday afternoon that it bought 10 million shares of GM during the quarter, the first time Buffett's company has bought into the automaker since it emerged from bankruptcy in 2009. Berkshire's stake, which was small enough to have been a portfolio selection made by one of Buffett's two recent hedge fund manager hires -- Todd Combs and Ted Weschler -- was valued at $256.5 million as of March 31, but was worth $214 million at Tuesday's close.

GM comprised a small fraction of the firm's $75 billion in holdings at the end of the first quarter, but it does represent Buffett's only play on the U.S. auto industry. Berkshire's only other U.S. transportation stock holding is UPS : the firm owns 1.4 million shares valued at $115 million. ...

Click to view a price quote on F.

Click to research the Automotive industry.

Ford's European Sales Fall in April

twocents@thestreet.com (Ted Reed) — Tue, 15 May 2012 13:01 GMT

DETROIT (TheStreet) -- Europe's continuing economic problems showed up in April auto sales, which slumped 7.7%. For the first four months of the year, sales are down 7.8%.

Ford reported Tuesday that its April sales in the 19 traditional European markets slumped 11.5% to 90,200 vehicles and its market shared dipped by 0.3 points to 7.7%. But Ford remains the second best-selling European brand. For the full year, Ford sales in the 19 markets were down 8.2% and market share was flat at 8.3%.

In the U.K., Ford's largest market in Europe, sales rose 4.3% to 24,400 vehicles and market share rose 0.5 points. ...

Click to view a price quote on F.

Click to research the Automotive industry.

US Airways Shares Take Off on Merger Outlook

twocents@thestreet.com (Ted Reed) — Mon, 14 May 2012 15:50 GMT

CHARLOTTE, N.C. (TheStreet) -- Merger chatter has been positive for shares in US Airways .

At mid-morning Monday, shares were trading at $11.53, up 22 cents or about 2%, while the Standard & Poor's 500 was down about 1%. On Friday, US Airways shares rose 4% after management of bankrupt AMR said it would explore the possibility of a merger while still in bankruptcy, reversing its previous position.

For the full year, shares in US Airways are up about 121%. During the morning shares rose as high as $11.73, their highest level since late 2011. ...

Click to view a price quote on AAMRQ.PK.

AMR's In-House Maintenance Commitment Set to Decline

twocents@thestreet.com (Ted Reed) — Mon, 14 May 2012 11:55 GMT

DALLAS (TheStreet) -- No matter how the AMR bankruptcy turns out, it is nearly certain to diminish the scope of a widely praised effort by the carrier and its workers to keep aircraft maintenance in-house and in the United States.

At one time, the cooperative effort by the airline and the Transport Workers Union to reduce cost by boosting efficiencies was a showpiece and an indication that American, after veering away from bankruptcy in 2003, had staked out a different path than competitors who were becoming more and more likely to reduce costs by outsourcing the maintenance work they had traditionally done themselves.

Now the amount of outsourced maintenance at AMR seems destined to increase no matter whether US Airways succeeds in a takeover bid or AMR management retains control. ...

Click to view a price quote on AAMRQ.PK.

5 Most Popular Vehicles for Moms

twocents@thestreet.com (Ted Reed) — Fri, 11 May 2012 12:33 GMT

DETROIT TheStreet) -- Let us say up front that this story concerns the kind of moms who still have kids at home, not the moms who have finished with that part of the job and only have to deal with the continuing requests for money, advice and emotional support.

Those younger moms probably don't even realize that once the kids have left the house, the work of being a mom continues unabated. Those moms probably think that if they only had a decent vehicle in which to put the little people, life would be at least semi-manageable.

As we approach Mother's Day weekend, we should consider the reality that the right vehicle can, in fact, vastly improve the logistics of motherhood. Within that context, TrueCar.com has selected the top five cars for moms, based on a nationwide survey of 200,000 mothers who bought new cars in 2011 and were polled by mail and Internet about their purchases. ...

Click to view a price quote on F.

Click to research the Automotive industry.

AMR Counters US Airways Bid With New Seat Plan, Better Stats

twocents@thestreet.com (Ted Reed) — Wed, 09 May 2012 18:55 GMT

DALLAS (TheStreet) -- Bankrupt AMR stepped up its resistance to the takeover bid by US Airways,, unveiling new passenger amenities including lie-flat business class seats and also releasing strong April unit revenue results.

"We have a lot of challenges ahead of us," said Virasb Vahidi, AMR chief commercial officer, in an interview following a media event, held aboard a Boeing 777-200 and focused on improved technology and fleet modernization efforts. "Our transformative initiatives are a clear signal to our customers and to our people that we believe in our future."

American's fleet modernization plan includes lie-flat seats in its fleet of 47 Boeing 777-200s and in the approximately 30 767-300s it intends to keep, as well as increased legroom in a new coach product called Main Cabin Extra, which will be available to premium passengers as well as to passengers who pay extra. ...

Click to view a price quote on AAMRQ.PK.

Ford Says China Sales Rose 24%

twocents@thestreet.com (Ted Reed) — Tue, 08 May 2012 13:30 GMT

SHANGHAI (TheStreet) -- Ford said its April sales in China grew 24%.

The automaker said sales totaled 54,881, helped by strong demand for the new Ford Focus, which sold 9,400 units following an April introduction. The new Focus, built on a global platform, is the first of 15 new vehicles Ford and its partners plan to introduce in China.

Ford's passenger car partner, Changan Ford Mazda Automotive, began producing the new Focus in a new facility, with a price range between $19,000 and $27,000. DFMA April sales rose 30% to 34,108, while sales by Jiangling Motors, Ford's commercial vehicle partner in China, rose 16% to 20,773. ...

Click to view a price quote on F.

Click to research the Automotive industry.

GM Has Big Plans for Cadillac in China

twocents@thestreet.com (Ted Reed) — Tue, 08 May 2012 10:36 GMT

DETROIT (TheStreet) -- If Buick can be among the hottest brands in China, why can't Cadillac do the same?

That's a question General Motors is asking. CEO Dan Akerson spelled out the automaker's ambitious plans for Cadillac on the automaker's first-quarter earnings call. 2013 Cadillac ATS

In 2011, Cadillac sales in China rose 73% to about 30,000. "That's good, but it's only 30,000," Akerson said. "And we're importing a fair number of those, exporting into China. But if Cadillac starts to build there, we'll have better margins that we do today. ...

Click to view a price quote on GM.

Click to research the Automotive industry.

GM's April Sales in China Rise 12%

twocents@thestreet.com (Ted Reed) — Mon, 07 May 2012 15:05 GMT

SHANGHAI (TheStreet) -- GM said its 2012 Chinese sales have reached 1 million units, the earliest ever it has reached that milestone.

April sales by GM and its affiliates in China rose 11.7% to 227,217 vehicles, bringing the total for the first four months of the year to 972,369 units, up 9.4% from a year earlier. On Monday, Kevin Wale, president and managing director of the GM China group, declared: "GM and our joint ventures today sold our one millionth vehicle in China this year. Growth in China may be slowing, but GM and Toyota reported double-digit sales gains there in April.

"This is the sixth time and the earliest in our history that we have reached this important milestone in China," Wale said, in a prepared statement. "It has put us on track to once again set a new sales mark for the year as a whole." ...

Click to view a price quote on GM.

Click to research the Automotive industry.

Delta Wants More Than to Be the Best Airline

twocents@thestreet.com (Ted Reed) — Mon, 07 May 2012 10:41 GMT

ATLANTA (TheStreet) - Although it has become, at least for the moment, the leading U.S. airline, Delta has broader aspirations.

In its recent move to buy an oil refinery, Delta bolstered the perception that following a 2009 merger, smaller Northwest took over Delta, replacing a genteel Southern corporate culture with a more combative, more assertive one, more willing to embrace causes and break precedents.

The refinery acquisition is either brilliant or inane -- that judgment will be made in the future -- but it is most certainly bold. Some airline analysts applaud the purchase from Phillips 66, a refining company being spun off from ConocoPhillips , while the consensus among oil analysts is more along the lines that the oil people knew what they were doing when they decided to abandon the facility. ...

Click to view a price quote on BA.

Click to research the Aerospace/Defense industry.

When Volkswagen Entered China

twocents@thestreet.com (Ted Reed) — Fri, 04 May 2012 10:47 GMT

NEW YORK (TheStreet) -- As Volkswagen competes to become the world's biggest automaker, largely on the strength of its China sales, a new book recalls the automaker's early days in what is now the world's leading auto market.

The autobiographical book Bridge Builder by Walter Kiep, published by Purdue University Press, recounts the journey of one of post-war Germany's leading entrepreneurs, businessman and semi-official diplomat who was the longtime chairman of Atlantik Brucke, the influential German-American friendship organization.

Born in 1926, Kiep lived through a remarkable period in German history that includes the rise of Nazism, defeat along with economic and structural destruction, and then a re-emergence which he helped to shape as one of the world's leading powers. VW has a parallel story. ...

Click to view a price quote on F.

Click to research the Automotive industry.

GM Beats and Raises U.S. Outlook

twocents@thestreet.com (Ted Reed) — Thu, 03 May 2012 12:01 GMT

DETROIT (TheStreet) -- General Motors said strong U.S. sales enabled it to beat first-quarter estimates and raise its 2012 sales outlook, even as it lost money in Europe.

Excluding items, the company reported net income of $1.6 billion, or 93 cents a share. Analysts surveyed by Thomson Reuters had estimated 85 cents. Revenue rose 4% to $37.8 billion. Analysts had estimated $37.6 billion.

Including a one-time net loss from special items related to goodwill impairment, GM earned $1 billion. or 60 cents a share. In the same quarter a year earlier, including a net gain from special items of $1.5 billion, or 82 cents a share, GM earned $3.2 billion, or $1.77 a share. ...

Click to view a price quote on GM.

Click to research the Automotive industry.

GM's First Quarter Will Benefit From More Trucks: Analyst

twocents@thestreet.com (Ted Reed) — Wed, 02 May 2012 13:20 GMT

DETROIT (TheStreet) -- Expectations for General Motors' first-quarter results aren't high, but analysts expect the automaker will benefit from increased truck production.

Analysts surveyed by Thomson Reuters expect earnings of 85 cents a share, down from 95 cents in the same quarter a year earlier. GM reports earnings on Thursday morning. The automaker reported Tuesday that April sales fell 8.2%, with calendar year-to-date sales down 0.4%. Last week, Ford reported that its net income fell 45% for the first quarter, although it did beat estimates.

GM shares are up about 12% for the year, but have generally been in retreat since they reached $27.03, close to the year's high, on April 3. Shares closed Tuesday at $23.31. Meanwhile, Ford shares, which closed Tuesday at $11.23, are up about 2% for the year. ...

Click to view a price quote on F.

Click to research the Automotive industry.

Ford, GM Take Hit in Compact Segments

twocents@thestreet.com (Ted Reed) — Tue, 01 May 2012 18:46 GMT

DETROIT (TheStreet) -- Ford and GM both reported disappointments in select small car segments on Tuesday, as Japanese automakers returned aggressively to the market.

But even though Detroit's two publicly held automakers reported overall sales declines, with Ford down 5% and GM down 8.2% as Toyota gained 11.6%, investors did not seem overly perturbed. GM shares were rising 35 cents to $23.35 in mid-afternoon trading Tuesday, while Ford shares were flat at $11.27.

"There's no doubt the Japanese are back in the market," said Don Johnson, vice president of U.S. sales operations, on the GM sales call. "They have a high inventory and they're being aggressive in the fleet business." ...

Click to view a price quote on F.

Click to research the Automotive industry.

GM's April Sales Fall 8.2% on Fewer Selling Days

twocents@thestreet.com (Ted Reed) — Tue, 01 May 2012 15:25 GMT

DETROIT (TheStreet) -- General Motors said April sales fell 8.2% but the automaker raised its outlook for the year.

The automaker said April sales totaled 213,387. Retail sales were flat compared with the same month a year earlier, while fleet sales declined 25%.

GM noted that April 2012 had three fewer selling days than the same month a year earlier. On a selling-day adjusted basis, total sales rose 3% and retail sales rose 12%. ...

Click to view a price quote on GM.

Click to research the Automotive industry.

Ford's April Sales Fall 5%

twocents@thestreet.com (Ted Reed) — Tue, 01 May 2012 14:06 GMT

DETROIT (TheStreet) -- Ford said its April sales declined by 5%, as sales of its cars fell by 10.3%.

The automaker sold 180,350 vehicles in April. Fiesta sales fell 44% to 5,135; Escape sales fell 20% to 16,896; Lincoln brand sales fell 12.8% to 6,308.

F-Series sales rose 4.4% to 47,453, the best April since 2007. Fusion sales rose 2% to a record April level of 21,610, while Edge sales rose 12.4% to an April record 10,520. Focus sales rose 13% to 19,425. ...

Click to view a price quote on F.

Click to research the Automotive industry.

AMR and US Airways Pilots Seek Joint Contract

twocents@thestreet.com (Ted Reed) — Tue, 01 May 2012 13:45 GMT

CHARLOTTE, N.C. (TheStreet) -- The president of the union that represents AMR pilots met Monday with leaders of the US Airways pilot union, as the two groups began to map out a joint strategy in advance of a hoped-for merger between their two carriers.

Leaders of both unions believe a merger would be beneficial, bringing a better contract at US Airways and a better contract than the one envisioned by AMR, which is seeking to abrogate its existing pilot contract in bankruptcy court. Gary Hummel, president of USAPA (left) and Dave Bates, president of APA.

"I'm here to build a bridge with our union brothers at USAPA and to coordinate in creating the world's largest and best airline," Dave Bates, president of the Allied Pilots Association, told reporters. APA represents 8,000 pilots, while the U.S. Pilots Association represents about 4,300 US Airways pilots. ...

Click to view a price quote on AAMRQ.PK.

Chrysler's April Sales Rise 20%

twocents@thestreet.com (Ted Reed) — Tue, 01 May 2012 13:41 GMT

DETROIT (TheStreet) -- Chrysler reported its highest April sales total in four years as sales rose 20%.

The automaker, the first to report April results, said sales totaled 141,165 units, up from 117,225 in April 2011, with sales records by five models: the Fiat 500, Chrysler 200, Dodge Challenger, Jeep Wrangler and Dodge Avenger.

"April was another strong month for Chrysler as our sales increased 20%, we recorded our 25th-consecutive month of year-over-year sales growth and we reported our strongest quarterly profit in 13 years," said Reid Bigland, Dodge brand CEO. "This business is all about product and the quality and fuel efficiency of our current vehicle line-up has never been better." ...

Boeing Rolls Out First South Carolina Dreamliner

twocents@thestreet.com (Ted Reed) — Fri, 27 Apr 2012 18:31 GMT

CHARLESTON, S.C. (TheStreet) -- Boeing on Friday rolled out the first 787 Dreamliner to be built in South Carolina, just 29 months after breaking ground on its $750 million complex here.

"It's not just a rollout of another new model," Jack Jones, vice president and general manager of Boeing Charleston, told reporters. "It is history. It is history for this state (and) it is history for the Boeing Co., to build a new aircraft outside of Puget Sound."

The 787 is viewed as the aircraft that will change commercial aviation, not only because it is more fuel efficient than predecessors but also because with 210 to 250 seats it is a relatively small plane that still can fly 7,800 miles, meaning it will open new global markets and, in effect, make the world smaller. ...

Click to view a price quote on BA.

Click to research the Aerospace/Defense industry.

4 Things to Like About Delta

twocents@thestreet.com (Ted Reed) — Thu, 26 Apr 2012 14:50 GMT

ATLANTA (TheStreet) -- Delta narrowly missed making money in the historically weak first quarter and during its earnings call flashed some positive signs.

Excluding items, the carrier reported a $39 million loss, despite a $250 million increase in fuel expense. Investors don't like it when rising fuel costs can overwhelm every good thing a company does, which is always a threat to airline shares. Nevertheless, Delta shares are up 27% this year and look like they could go higher for these four reasons. Gains in New York

First, Delta is gaining ground at New York LaGuardia, where it is building a hub that will offer more than 250 daily departures by summer, largely because it will complete a deal with US Airways in which it gains 132 slots in exchange for slots at Washington Reagan National. New York is the world's largest travel market, so gains there are important, and no carrier has every offered so many flights from LaGuardia. ...

Click to view a price quote on DAL.

Click to research the Transportation industry.

United Looks Past Integration Woes

twocents@thestreet.com (Ted Reed) — Thu, 26 Apr 2012 13:00 GMT

CHICAGO (TheStreet) -- United Continental reported a first-quarter loss due to merger integration costs, but beat estimates and said it is now "on the steep back slope" of its integration.

The carrier reported a net loss of $286 million, or 87 cents a share. Analysts surveyed by Thomson Reuters had expected a loss of 96 cents. Revenue rose 4.9% to $8.6 billion, in line with estimates.

Including items, primarily special charges related to merger integration costs, United reported a net loss of $448 million, or $1.36 a share. ...

Click to view a price quote on UAL.

Click to research the Transportation industry.

UPS Misses by a Penny as Asia Weakness Continues

twocents@thestreet.com (Ted Reed) — Thu, 26 Apr 2012 12:14 GMT

ATLANTA(TheStreet) -- UPS said quarterly net income rose 6%, but the company missed analysts' earnings estimates by a penny and also fell short of revenue estimates as weakness in Asian exports continued.

The largest overnight package shipper said net income was $970 million, or $1 a share. Analysts had estimated $1.01. Revenue rose 4% to $13.1 billion. Analysts had estimated $13.3 billion.

In the same quarter a year earlier, UPS earned $915 million, or 91 cents a share. ...

Click to view a price quote on UPS.

Click to research the Transportation industry.

Chrysler Profit Rises on U.S. Sales Gains

twocents@thestreet.com (Ted Reed) — Thu, 26 Apr 2012 11:22 GMT

DETROIT (TheStreet) -- Chrysler said first-quarter net income more than quadrupled following a 40% increase in U.S. sales.

The automaker reported net income of $473 million, compared with $116 million in the same period a year earlier. Revenue rose 25% to $16.4 billion. Chrysler CEO Sergio Marchionne

"Another positive quarter -- built on sales gains that have surpassed the industry average -- is affirmation that the Chrysler team is maintaining its focus," said CEO Sergio Marchionne in a prepared statement. ...

Click to view a price quote on F.

Click to research the Automotive industry.

US Airways: We'd Share Merger Synergies With Workers

twocents@thestreet.com (Ted Reed) — Wed, 25 Apr 2012 19:02 GMT

CHARLOTTE, N.C.(TheStreet) -- US Airways said it can afford to offer more to AMR workers in a merger than AMR could as a standalone company because a merger would offer revenue and cost synergies.

"There's a tremendous amount of value created by merging US Airways and AMR," said US Airways President Scott Kirby, on the carrier's earnings conference call. "We can and should share with employees."

Kirby said merger synergies, after sharing some of them with labor, would be more than $1.2 billion. Every previous recent airline merger has generated significant cost savings due to reductions in areas such as leased airport space, management headcount, and prices for goods and services due to enhanced purchasing power, as well as revenue synergies, Kirby said. ...

Click to view a price quote on AAMRQ.PK.

Boeing Says It Backs AMR Plan to Reorganize

twocents@thestreet.com (Ted Reed) — Wed, 25 Apr 2012 16:04 GMT

CHICAGO (TheStreet) -- AMR creditor Boeing said it backs AMR's plan of reorganization, rather than an effort by US Airways to merge with the carrier.

Answering a reporter's question during Boeing's earnings call, CEO Jim McNerney said, "American is working through the process now and we support them emerging from this thing as a stronger airline."

"We've seen mergers before," McNerney added. "It's not clear that this one's going to happen, by the way, in our view." ...

Click to view a price quote on AAMRQ.PK.

US Airways Beats Estimates, Sees Strong Demand

twocents@thestreet.com (Ted Reed) — Wed, 25 Apr 2012 13:03 GMT

CHARLOTTE, N.C. (TheStreet) -- US Airways reported a first-quarter loss but beat estimates and said demand remains strong.

Excluding items, the carrier reported a net loss of $22 million, or 13 cents a share. Analysts had estimated a loss of 22 cents. Revenue rose 10.3% to $3.3 billion. Analysts had estimated $3.2 billion.

Including items, primarily a $73 million credit related to a slot exchange with Delta , offset by a $3 million special operating charge, US Airways reported a profit of $48 million, or 28 cents a share, compared to a loss of $114 million, or 71 cents a share, in the same quarter a year earlier. A remaining $74 million credit related to the slot exchange is expected to be recognized in the third quarter. ...

Click to view a price quote on LCC.

Click to research the Transportation industry.

Delta Reports Loss on Fuel Costs but Expects 2Q Gains

twocents@thestreet.com (Ted Reed) — Wed, 25 Apr 2012 12:32 GMT

ATLANTA (TheStreet) -- Delta reported a first-quarter loss as fuel costs increased by $250 million, but projected gains in the current quarter.

Excluding items, the carrier lost $39 million, or 5 cents a share, in line with estimates. Revenue rose 9% to $8.4 billion, also in line with estimates.

Including $163 million in special items, primarily $151 million in mark-to-market gains for fuel hedges, Delta reported first-quarter net income of $124 million. The carrier's pretax loss was $36 million, representing a $355 million improvement over the same period a year earlier despite a $250 million increase in fuel expense. ...

Click to view a price quote on DAL.

Click to research the Transportation industry.

Boeing Beats on Strong Deliveries; Shares Rise

twocents@thestreet.com (Ted Reed) — Wed, 25 Apr 2012 12:00 GMT

CHICAGO (TheStreet) -- Boeing beat analysts' estimates as revenue rose 30%, largely reflecting increased commercial aircraft deliveries.

Excluding items, the aircraft maker earned $1.11 a share. Analysts surveyed by Thomson Reuters had estimated 94 cents. Revenue rose 30% to $19.4 billion. Analysts had estimated $18.4 billion.

Including items, primarily a reduction in a litigation reserve, Boeing earned $923 million, or $1.22 a share, representing a 58% increase from $586 million in the same period a year earlier. Margin was 8.1%, up 1.4 points from 6.7% a year earlier. ...

Click to view a price quote on BA.

Click to research the Aerospace/Defense industry.

Boeing Sags but Analysts Like 787 Production Outlook

twocents@thestreet.com (Ted Reed) — Tue, 24 Apr 2012 15:44 GMT

CHICAGO (TheStreet) -- In the latest chapter of the melodrama "What can possibly cloud the outlook for Boeing shares?" we have tornadoes in Kansas.

That is because a tornado on April 14 in Wichita damaged a plant operated by Spirit AeroSystems, a Boeing supplier that makes the nose section for the 787 and works on fuselages for other planes. Boeing's assessment of the impact is likely to be a topic on its earnings call Wednesday morning.

In general, analysts aren't overly concerned about a decline in what may be the most closely watched Boeing indicator, the 787 production schedule. Currently, the rate is projected to increase to 3.5 a month by mid-year and to 10 a month by the end of 2013. Additionally, Boeing has its share of good news, including the scheduled Friday rollout the first 787 produced in Charleston, S.C., as well as recent reports that the company has pulled ahead of Airbus in talks with United Continental, the world's largest airline, in securing an order for close to 200 narrowbody aircraft. ...

Click to view a price quote on BA.

Click to research the Aerospace/Defense industry.