American Airlines pilots reject contract
FORT WORTH, Texas, Aug. 8 (UPI) -- The American Pilots Association, representing Texas-based American Airlines, voted down a tentative contract offer Wednesday.
The vote was 2,935 pilots approving the agreement and 4,500 pilots rejecting it, APA said on its Web site.
Before the vote, APA officials told members that Chapter 11 bankruptcy restructuring of American Airlines "was a distinct possibility."
"Based on the recent experiences of other pilot groups, we were well aware that Chapter 11 is not a labor-friendly process," association officials said in a letter posted on the APA Web site.
Separately, American Airlines mechanics approved a new contract offer after rejecting an earlier offer in May, The Wall Street Journal reported. The Transport Workers Union's vote, which squeaked by with just 50.25 percent, means the workers won't face the possibility that the bankruptcy judge would grant motion to rescind the mechanics' current contract and let the company impose more austere terms.
American in a statement said the TWU ratifications are "an important step forward in our restructuring." The company said it was "disappointed" by the pilot vote and would wait for ruling by Judge Sean Lean that will allow the airline's parent company, Fort Worth, Texas-based AMR Corp., to implement changes required for its restructuring.
AMR filed for Chapter 11 bankruptcy protection in November.
Toyota mulls raising N. America production
TRAVERSE CITY, Mich., Aug. 8 (UPI) -- Toyota Motor Corp. is considering shifting more production to North America to help ease the impact of the rising yen, the Japanese automaker's U.S. chief said.
Jim Lentz, Toyota's U.S. president and chief executive officer, said Wednesday the company is considering the financial benefits of moving production of a high volume vehicle, possibly the luxury Lexus ES sedan, from Japan, The Wall Street Journal reported.
"The ES is now built out of Japan, so that would be something we would look at," Lentz said told the Journal during an automotive conference in Traverse City, Mich. "Everything is on the table."
The ES is the second-highest volume vehicle in the Lexus line.
A strong yen chips away at the price competitiveness of Japanese-made products exported abroad, meaning some companies can lose money on vehicles they ship.
Two weeks ago, Toyota announced plans to stop exporting the Lexus RX to North America from Japan, saying it would build all of the vehicles in North America. The company said it would invest $98.3 million to boost production capacity at its Cambridge, Ontario, plant, possibly as soon as 2014.
Toyota's Georgetown, Ky., plant would be the likely production home for the Lexus ES because the factory produces the Camry, which shares the same underpinnings as the Lexus model, the Journal said. Lentz declined comment on whether the company would build a new plant in the United States.
Home prices pick up in second quarter
NEW YORK, Aug. 8 (UPI) -- Second-quarter home prices rose by their largest percentage in at least seven years, pushed by low inventories and high demand for foreclosed properties.
Prices rose by 2.5 percent in June from a year ago, and by 6 percent from the previous quarter, reported CoreLogic Inc., a Santa Ana, Calif., data firm, which said the quarterly jump was the greatest since 2005.
Freddie Mac said home prices during the second quarter rose by 4.8 percent from the previous quarter, which it said was the largest jump since 2004.
Freddie Mac, officially the Federal Home Loan Mortgage Corp., said in a release the so-called shadow inventory -- foreclosures or homes owners are delaying putting on the market until the prices improve -- might not be as foreboding as many think.
"While the shadow inventory persists, there is an important difference in today's market compared with those of recent years and that's the substantially reduced amount of excess vacant housing," said Frank Nothaft, Freddie Mac vice president and chief economist. "The housing recovery may finally be coming out from the shadows."
The Wall Street Journal said Wednesday the key force behind the gains seemed to be a shortage of homes for sale, reporting that the number of properties on the market was less than a year ago despite an increase in demand because of low interest rates.
New home construction has been at depressed levels for years because of the number of foreclosed properties. That lack of new construction also "has set the foundation for a snap back in pricing," said Michael Sklarz, president of Collateral Analytics in Honolulu.
U.S. stock indexes mixed at end of trading
NEW YORK, Aug. 8 (UPI) -- U.S. stock indexes began in negative territory Wednesday but finished the day mixed in late afternoon trading.
The Dow Jones industrial average gained 7.04 points, 0.04 percent, to 13,175.64.
The Nasdaq Composite was off 4.61 points, 0.15 percent, to 3,011.25.
The Standard and Poor's 500 picked up 0.87 points, 0.06 percent, and closed at 1,402.22 -- ending the trading session at more than 1,400 for the second straight day.
Foreign and domestic occurrences affected the stock indexes. Spain was forced to pay more to borrow in a $3.7 billion auction of short-term government debt and wider investor worry over the eurozone also forced Italian and German yields higher.
Domestically, the U.S. Labor Department reported productivity increased at a 1.6 percent annual rate in the second quarter. However, labor costs rose 1.7 percent.
On the New York Stock Exchange, the total listed volume was 3.08 billion shares.
The 10-year U.S. treasury bond was yielding 1.649 at midday.
Against the euro the dollar was $1.2361 Wednesday from $1.24 Tuesday. Against the yen, the dollar was 78.44 Wednesday from 78.62 Tuesday.
In Tokyo, the Nikkei closed at 8,881.16, up 77.85 points, or 0.88 percent.
In London, the FTSE 100 closed at 5,845.92, up 4.68, or 0.08 percent.