Friday, January 25, 2013 6:03 pm
By The Associated Press
From the start, Dreamliner jet program was rushed
NEW YORK (AP) - The 787 Dreamliner was born in a moment of desperation.
It was 2003 and Boeing - the company that defined modern air travel - had just lost its title as the world's largest plane manufacturer to European rival Airbus. Its CEO had resigned in a defense-contract scandal. And its stock had plunged to the lowest price in a decade.
Two years after the 9/11 terrorist attacks, financially troubled airlines were reluctant to buy new planes. Boeing needed something revolutionary to win back customers.
Salvation had a code name: Yellowstone.
It was a plane that promised to be lighter and more technologically advanced than any other. Half of it would be built with new plastics instead of aluminum. The cabin would be more comfortable for passengers, and airlines could cut their fuel bills by 20 percent.
But once production started, the gap between vision and reality quickly widened. The jet that was eventually dubbed the Dreamliner became plagued with manufacturing delays, cost overruns and sinking worker morale.
Economist: Euro crisis could erupt again this year
DAVOS, Switzerland (AP) - Is the euro crisis over? A leading U.S. economist says not by a long shot.
Even as the head of the European Central Bank talked Friday of "positive contagion" in the markets and predicted an economic recovery for the recession-hit eurozone later this year, economist Barry Eichengreen warned that the debt crisis that has shaken Europe to its core could easily erupt again this year unless European leaders move faster to solve their problems.
While European governments and markets have been breathing easier in recent months after years of turmoil, it's no time for complacency, said Eichengreen, who has chronicled the Great Depression and explored the consequences of a breakup of the euro currency used by 17 nations.
Procter & Gamble fiscal 2Q profit jumps
NEW YORK (AP) - Procter & Gamble is turning a corner.
The world's largest consumer goods company, whose products like Tide detergent and Gillette razors are in 98 percent of U.S. households, in recent years has lost business to competitors as it grew too fast overseas and kept prices high.
But on Friday P&G reported that its fiscal second quarter profit more than doubled as the plan the company launched last year to lower costs and roll out new products boosted its bottom line. It is the second quarter in a row that P&G beat Wall Street estimates.
Billionaire investors square off on live TV
NEW YORK (AP) - A long-simmering spat between billionaire investors Carl Icahn and Bill Ackman boiled over into a shouting match on live television Friday.
The two Wall Street titans, interviewed by phone simultaneously on CNBC, traded barbs about an old investment deal and on Ackman's position in the nutritional supplements distributor Herbalife Inc.
Ackman was being interviewed by CNBC host Scott Wapner a day after Icahn made disparaging comments about him on Bloomberg Television. After Ackman had spoken about some of his current investment positions, Wapner interrupted the conversation to say that Icahn had called in and had a few points to make.
The two men then spent the better part of thirty minutes telling Wapner why they didn't much care for each other.
US new-home sales fell in December, sales for year up
WASHINGTON (AP) - Sales of new U.S. homes cooled off in December compared with November, but for the entire year they were the best since 2009.
The Commerce Department said Friday that new-home sales fell 7.3 percent last month to a seasonally adjusted annual rate of 369,000. That's down from November's rate of 398,000, which was the fastest in 2 1/2 years.
For the year, sales rose nearly 20 percent to 367,000. That's the most since 2009, although the increase is coming off the worst year for new-home sales since the government began keeping records in 1963. Sales are still below the 700,000 level that economists consider healthy.
Hasbro 4Q revenue misses, to cut jobs
NEW YORK (AP) - Toy maker Hasbro said Friday that its fourth-quarter revenue failed to meet expectations because of weaker-than-expected demand over the holidays. It plans to cut about 10 percent of its workforce and consolidate facilities to reduce expenses.
The stock dropped about 3 percent.
Pawtucket, R.I.-based Hasbro, whose brands include Monopoly and Nerf, has about 5,500 employees worldwide. A 10-percent workforce cut would put about 550 people out of jobs.
While Hasbro said consumer demand was softer than expected over the holidays, the season was predicted to be tough. That was partly because retailers were ordering inventory cautiously.
Verizon sells spectrum to AT&T for $1.9 billion
NEW YORK (AP) - Verizon Wireless said Friday that it's selling space on the airwaves to AT&T Inc. in exchange for $1.9 billion and the transfer of some airwave rights from AT&T.
The sale of spectrum rights will let AT&T expand its capacity for wireless broadband in areas that include Chicago, Los Angeles, Miami, Oklahoma City and Cincinnati. In return it's getting other frequencies in Los Angeles, Fresno, Calif., Phoenix and Portland, Ore.
The deals are part of a yearlong spectrum reshuffling process for Verizon and AT&T. AT&T is on the hunt for more spectrum, while Verizon has been optimizing its holdings to make them easier to use with wireless service.
Netflix's stock still winning fans on Wall Street
SAN FRANCISCO (AP) - Netflix remains a hot ticket on Wall Street.
The Internet video service's stock climbed another 15 percent Friday to reach its highest level in 16 months. The latest surge followed a 42 percent leap on Thursday that marked the stock's biggest single-day gain since Netflix Inc. went public in May 2002.
Netflix's fourth-quarter earnings spurred the stampede to buy the company's stock. The results released Wednesday were highlighted by an unexpected profit and accelerated customer growth that gave Netflix 33 million worldwide subscribers to its service that streams movies and TV shows to Internet-connected devices.
Gatorade to remove controversial ingredient
NEW YORK (AP) - PepsiCo Inc. is removing a controversial ingredient from its Gatorade sports drink in response to customer complaints.
Molly Carter, a spokeswoman for the company, said Friday that the removal of brominated vegetable oil was in the works over the past year after the company began "hearing rumblings" from consumers about the ingredient. She said it wasn't a reaction to a recent petition on Change.org by a Mississippi teenager.
The ingredient is also used in other drinks, including some flavors of Powerade made by rival Coca-Cola Co. The Atlanta-based company did not say whether it would remove the ingredient from Powerade but noted that it takes customer concerns into account when looking for ways to improve its drinks.
Subway is sorry its `Footlong' came up short
NEW YORK (AP) - Subway is apologizing that its "Footlong" sandwiches fell short of expectations.
The world's largest fast-food chain faced widespread criticism last week after a man posted a photo online showing a "Footlong" next to a tape measure that showed it to be just 11 inches. Subway said Friday that it's redoubling efforts to "ensure consistency and correct length" in all its sandwiches.
The company had already noted last week that bread length could vary when franchisees don't bake to its exact specifications and that it would reinforce policies to ensure consistency.
By The Associated Press(equals)
The Dow Jones industrial average closed at 13,895.98, up 70.65 points. The Nasdaq composite gained 19.33 points to 3,149.71. The S&P 500 rose 8.14 points to 1,502.96.
Benchmark oil fell 7 cents to close at $95.88 in trading on the New York Mercantile Exchange. Brent crude, used to price international varieties of oil, ended flat at $113.28 per barrel on the ICE Futures exchange in London.
Wholesale gasoline rose 1 cent to finish at $2.88 per gallon. Natural gas ended unchanged at $3.44 per 1,000 cubic feet. Heating oil fell 3 cents to finish at $3.06 a gallon.