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UPI NewsTrack Business

Jan. 19, 2013 at 12:18 PM   |   Comments

Boeing CEO confident in Dreamliner

CHICAGO, Jan. 19 (UPI) -- Boeing Co. Chief Executive Officer Jim McNerney says he is confident the U.S. company can soon return the grounded 787 Dreamliner back to service.

The Federal Aviation Administration took the rare step this week of grounding the entire fleet of the new jet after a series of incidents in which Dreamliners have been forced to make emergency landings or react to smoking-filled planes on the ground due to problems with the lithium battery systems.

The New York Times reported Saturday that the FAA has not grounded an entire fleet of planes since 1979, when it ordered the cessation of McDonnell Douglas DC-10 flights after a crash.

Boeing's 787 Dreamliner was launched in 2011 after the initial delivery date was postponed by more than three years due to a series of production and engineering setbacks.

In a memo sent Friday to company employees, McNerney said: "Despite the negative news attention over the past several days, I remain tremendously proud of the employees across the company for the decade of effort that has gone into designing, developing, building and delivering the most innovative commercial airplane ever imagined."

McNerney noted that the Dreamliner has been in service for 15 months, during which time it has "completed 18,00 flights and 50,000 flight hours with eight airlines, carrying more than 1,000,000 passengers safely to destinations around the world."

The Hill newspaper reported that McNerney considered the Dreamliner's launch to be "on par with the best-in-class introduction of the 777," although he added, "We will not be satisfied until the 787 meets the even higher standard of performance we set for it and promised to our customers."

Analysts say the setback could take weeks to correct if it's a local problem or it could takes months to fix if involved the entire electrical system in the jets.

CNN reported that grounding the entire Dreamliner fleet was reflective of the "zero tolerance" for safety risks that has contributed to an improved crash record for U.S. airlines -- which have not experienced a fatal incident since a February 2009 passenger jet crash in Buffalo, N.Y.

The Dreamliner incidents have been comparatively minor, but alarming. In one recent incident, one of the plane's two lithium batteries caught fire in a plane with no passengers onboard, while crews in Boston were getting the plane ready for a flight. In the other incident, also involving a lithium battery, a plane was forced to make an emergency landing after a smoke alarm in the cockpit went off.

Jets owned by Japanese Airlines, All Nippon Airways, United Airlines and Qatar Airways have all had similar problems, CNN reported.


Mint sells out of silver bullion coins

WEST POINT, N.Y., Jan. 19 (UPI) -- The U.S. Mint said it is temporarily out of stock on silver coins after selling a record 6.7 million ounces in eight days, but will resume sales soon.

The 2013 American Eagle silver bullion coins were sold Jan. 7-15, breaking the previous sales record of 6.42 million ounces sold in January 2011.

"We mint to demand," said Michael White, a spokesman for the mint.

Precious metal dealers said customers were buying for the value of the silver, not the value of the coin.

"When people are buying bullion they're not collecting the coins, they just want to have reliable silver," ABC News quoted Peter Schiff, economist and president of Euro Pacific Precious Metals, as saying.

"With the Federal Reserve clearly stating that unlimited money creation and dollar debasement are its intended policy goals, it's becoming painfully obvious to more and more investors that precious metals are a better savings alternative than zero-interest bank deposits," he said.

Schiff suggested buying silver bullion coins as a way to break into the market. He said buying Canadian Maple Leaf silver bullion coins was "just as good," as buying U.S. coins.

Hard times have pushed the market, said Terry Hanlon, president of Dillon Gage Metals in Dallas.

"We are very, very busy and we have been for the last several months. That would certainly reflect that people are worried that the financial situation in the U.S. isn't going to get any better -- so they're buying precious metals," he said.


Soda makers adjust to new norms

NEW YORK, Jan. 19 (UPI) -- U.S. soda makers Coca-Cola Co. and PepsiCo say business is fine, but industry analysts said they were worried a slide in soda sales may be permanent.

As baby boomers age, their beverage preferences are aging along with them. But youth are turning increasingly to other beverages, The Wall Street Journal reported.

Soda sales fell 0.6 percent in 2012 to $28.7 billion said research firm SymphonyIRI Group. By volume, sales fell 1.8 percent.

Figures also show that the sales decline accelerated as the year progressed.

"The question from here is if that is the new norm,'' said Sanford C. Bernstein beverage industry analyst Steve Powers.

Company officials said sales figures only counted store sales. Furthermore, not only were sales of soda holding up overseas, but shareholders can pretty much assume that if a strong rival or even a charging ahead curiosity enters the market, Coke, Pespi or Dr. Pepper Snapple has the cash on hand to buy it outright.

All three companies have expanded their portfolios in recent years.

PepsiCo, for example, owns Naked juice brand and sales for that brand rose about 25 percent in 2012.

"I think we can all be optimistic about the business we're in,'' said Coke's global chief customer officer Sandy Douglas in December.

Soda makers are all facing an image battle, trying to overcome the concept that soda contributes to diabetes and obesity.

Last year, Diet Coke surpassed Pepsi to become the No. 2 best selling soda behind Coke.

But PepsiCo Chief Executive Officer Indra Nooyi said Pepsi was making "enormous progress," with artificial sweeteners.

Pepsi was 90 percent close to a breakthrough on sweeteners. "Unfortunately, the last 10 percent is the toughest part," she said.


Poll: Country's well being outranks GDP

WASHINGTON, Jan. 19 (UPI) -- Countries and regions become less stable as thriving decreases and suffering increases, a U.S. pollster says.

Jim Clifton, chairman and chief executive officer of Gallup and author of "The Coming Jobs War," said gross national well being -- peoples' life satisfaction -- occurs before gross domestic product, or the amount of goods and services produced in a country.

"Virtually all world leaders and heads of states and cities are focused on the wrong things. They are looking through the rear view mirror at GDP in an attempt to see the road ahead," Clifton said in a statement. "Consequently, they are managing their countries and cities after the fact. Because GDP follows gross national well being, leaders need to understand what well being tells us, the impact it has on constituencies, and most importantly, how to increase it."

Gallup classifies respondents' well being as thriving, struggling or suffering, based on how they rate their current and future lives on a ladder scale with steps numbered from 0 to 10 based on the Cantril Self-Anchoring Striving Scale. People are considered thriving if they rate their current lives a 7 or higher and expectations for their lives in five years an 8 or higher, while those who rate their current or future lives a 4 or lower are classified as suffering. All others are considered "struggling."

Gallup has been asking well being questions in more than 150 countries for the past seven years via its World Poll.

Gallup found worldwide those who have "good jobs" -- those who work for an employer for at least 30 hours per week -- are most likely to be thriving, those employed part-time and those who are unemployed are less likely to be thriving and the self-employed lag behind and are the least likely to be thriving.

As countries and cities make drastic cuts in government spending and services, they need to keep a close eye on the percentage of people who are suffering because that number is an indicator of potential extreme citizen discomfort and unrest -- even chaos -- Clifton wrote in an article in the Gallup Business Journal.

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