News Archive

Viacom CEO Dauman seeks trial by end-Sept over Redstone trust

Viacom Inc (VIAB.O) Chief Executive Officer Philippe Dauman has asked a Massachusetts court to expedite a legal challenge to his removal from a trust that will determine the entertainment company’s future after controlling shareholder Sumner Redstone dies or is deemed incapacitated.

Dauman and longtime board member George Abrams requested a trial date be set for no later than the end of September a court filing dated May 25. The petition requests that legal discovery begin immediately, and said it would require at least one medical examination of Redstone, who turns 93 on Friday, as well as a deposition of Shari Redstone, his daughter.

Redstone removed Dauman and Abrams from the seven-person Sumner M. Redstone National Amusements Inc Trust last week as well as the National Amusements board. A lawyer representing Redstone said the media mogul had concerns about Viacom’s performance.

Dauman fired back on Monday saying the move to replace him and Abrams from both the trust and the National Amusements board amounted to an “unlawful corporate takeover” by the mogul’s daughter, Shari Redstone.

“We are looking forward to an expedited dismissal of this meritless suit,” Shari Redstone said in a statement.

In the Massachusetts lawsuit, Dauman questioned the mogul’s mental competence. In a suit brought by an ex-girlfriend when he removed her as his designated healthcare agent, Dauman had testified that he had conversations with Redstone and he was engaged and attentive.

Frederic Salerno, Viacom’s lead independent director, on Wednesday asked for a meeting with Redstone, who is considering the request, according to a source familiar with the situation. It was not immediately clear what the agenda would be.

National Amusements, Sumner Redstone’s privately held movie theater chain, owns 80 percent of the voting stock in both Viacom and CBS Corp (CBS.N).

Dauman’s amended complaint filed Wednesday stated that Shari Redstone has frequently requested that the board replace Dauman.

Representatives for both Redstones were not immediately available for comment.

Separately, Sumner Redstone asked a Los Angeles Court on Monday for an order validating his removal of Dauman and Abrams from his trust and from the board of National Amusements Inc.

The outcome of the court cases – and who ends up with control over the trust and the National Amusements board – will have wide-ranging implications for Viacom and CBS shareholders and could result in changes at the top of both companies, possibly through mergers and acquisitions.

Viacom shares were up 1.3 percent to $42.52 in afternoon New York Stock Exchange trading.

(Reporting by Jessica Toonkel in New York and Lisa Richwine in Los Angeles; editing by Jeffrey Benkoe)

Article source:

U.S. rates may rise ‘fairly soon,’ Brexit a concern: Fed’s Powell

WASHINGTON The U.S. Federal Reserve on Thursday continued to lay the groundwork for an interest rate increase in the next two months, with a senior policymaker saying the economy will likely be ready for such a move “fairly soon.”

Federal Reserve Governor Jerome Powell, a voting member of the U.S. central bank’s rate-setting committee, said in a speech in Washington that he felt the economy was on a “solid footing” and within reach of the Fed’s inflation and employment goals.

But he added that the uncertainty surrounding Britain’s June 23 referendum on whether to leave the European Union was an argument in favor of the Fed exercising “caution” as it ponders whether to raise rates at its June 14-15 policy meeting.

The Fed will hold another policy meeting on July 26-27.

Powell, however, struck an overall positive tone about the U.S. economy in an appearance at the Peterson Institute for International Economics, becoming the latest Fed policymaker in recent days to say it may be time to notch rates higher.

The Fed’s Washington-based Board of Governors has a decisive role in setting monetary policy, and its members have a permanent vote on the committee that sets the central bank’s key federal funds rate.

Powell said he felt that data showing continued job creation and evidence of rising wages were a more important signal about the economy’s direction than recent weakness in consumer spending and business investment.

“There are good reasons to think that underlying growth is stronger than these recent readings suggest,” Powell said. “If incoming data support these expectations, I would see it as appropriate to continue to gradually raise the federal funds rate.”


Powell spoke a day before a scheduled public appearance by Fed Chair Janet Yellen. Yellen’s remarks on Friday as well as those in a speech in early June will be closely parsed for clues about the Fed’s monetary policy stance going into the June meeting.

After increasing rates in December for the first time in a decade, the Fed has watched tentatively as global markets seesawed and weak growth in China, Japan and Europe threatened to pull the U.S. recovery off track.

But the Fed now regards those risks as “waning,” and the minutes from its April policy meeting showed several policymakers keying in on a possible June rate increase.

That has shifted market expectations that had been discounting higher rates until later in the year, with trading in federal funds futures on Thursday implying a 26 percent chance of an increase next month and 56 percent in July.

David Stockton, the Fed’s former research director, said on Thursday he felt the only thing holding the central bank back from raising rates in June was the “Brexit” vote.

Though Fed policymakers, including Powell on Thursday, have said they see little broad systemic risk in a British departure from the EU, they still regard it as an international risk at a time when the U.S. economy has been weighed down by poor global demand and a rising dollar.

“Brexit is likely to stay their hand” in June, Stockton said, but “they are on track” for July.

(Reporting by Howard Schneider and Linday Dunsmuir; Editing by Paul Simao)

Article source:

Saudi Aramco boosting market share as it prepares for listing: CEO

KHOBAR, Saudi Arabia Saudi oil giant Aramco is gaining market share and pushing for greater efficiency, chief executive Amin Nasser said in an interview, as it acts as a “bridge” to a future when the nation relies less on energy exports.

Nasser also told Reuters that the state-owned group was pressing on with preparations for its partial privatization via a stock market listing, which he said lay at the heart of Riyadh’s “Vision 2030”, a long-term economic plan headed by Deputy Crown Prince Mohammed bin Salman.

Riyadh has been the driving force behind OPEC’s decision in November 2014 to refuse to cut supply to boost prices. Instead it opted to raise output and fight for market share against higher-cost rivals such as U.S. shale producers – as well as fellow OPEC member Iran which has ramped up its exports since the lifting of international sanctions.

“We are preserving our market share which continues to increase year-on-year,” he said in the interview, conducted on Wednesday. “This year, as last year, it is increasing. Our market share is picking up,” he added, without giving figures.

An OPEC meeting on June 2 will be the first for new Saudi energy minister Khalid al-Falih – Saudi Aramco’s chairman – at a time when Iranian exports have risen close to pre-sanctions level.

Saudi and Iranian OPEC delegates clashed earlier this month over long-term strategy, sources said, with Riyadh saying OPEC should not manage the market by regulating supply – as it has done throughout its history – and Tehran arguing that the group had been created to perform precisely that task.

Riyadh’s current tactics seem to be working. Oil LCOc1 has recovered to $50 a barrel from a 12-year low of $27 in January despite the Iranian increase.

Nasser said he expects prices to “trend upward by the end of the year” as global demand picks up and production from high-cost producers, such as shale oil and deep water offshore fields, falls.


He saw energy continuing to play a major role while Vision 2030 aims to address falling oil revenue and sharp fiscal deficits by boosting the private sector, ending government waste and diversifying the economy. Central to this is the planned initial public offering (IPO) of Aramco shares.

“Listing Saudi Aramco is in the heart of Vision 2030. We are seriously working on the IPO,” Nasser said. “Of course, the oil and gas sector will be the bridge to the long-term and we need to maximize our revenue by introducing more efficiency in the sector.”

“Vision 2030 isn’t saying no to oil by 2020. What we need is to diversify our economy and we should have a more sustainable economy because we shouldn’t be totally dependent on one commodity,” he added.

Aramco is working on the options for floating less than 5 percent of its value, which include a single domestic stock exchange listing and a dual listing with a foreign market, Nasser said.

The company is finalizing its proposals and will present them to its Supreme Council soon, which could see part of Aramco publicly listed by 2017-18. However, Nasser said the timeframe was not set yet.

As part of Aramco’s market share push, the company plans to raise its total refining capacity – both inside the kingdom and abroad – to 8 million-10 million barrels per day from around 5.4 million bpd now.

This week it signed an agreement to supply up to 270,000 bpd of crude oil to a refinery it will jointly upgrade with Indonesia’s Pertamina.

Forecasting growing crude oil demand, Aramco has said it was seeking to invest further downstream as part of broader expansion plans in several markets such as China, India, Vietnam and the United States.


Riyadh has traditionally kept an expensive “spare cushion” of excess production capacity, allowing it to raise or reduce levels to influence prices according to the government’s market strategy. Private oil companies, by contrast, do not hold back output for strategic gain.

Nasser said that for the time being Aramco’s maximum sustainable capacity would stay at 12 million bpd despite its plans to build new refineries and expand its petrochemicals business.

“If you use oil in refining, in chemicals or to produce chemicals or products, it will be part of the maximum sustainable capacity of Saudi Aramco, so 12 million bpd for the time being is the capacity,” he said.

The company pumped on average about 10.2 mln bpd in 2015 “which means we still have ample spare capacity”, he said.

That was an all-time record, Aramco said in its 2015 annual review.

While the global rig count has dropped substantially, the number of Aramco’s rigs is increasing slightly due to significant growth especially in the downstream and petrochemicals sector and in gas for domestic consumption.

Under the government’s diversification plans, the kingdom plans to generate 9.5 gigawatts of electricity from renewable energy.

Nasser said Aramco is looking to play a major role in achieving that target. “Renewable is in our radar…and we are looking forward to play a major role in renewable in the near future,” he said.

The company had set up a renewable energy department and is studying plans to invest in wind and solar power.

(Editing by Rania El Gamal and David Stamp)

Article source:

McDonald’s CEO says $15 hourly wage, robots won’t kill jobs

OAK BROOK, Ill./LOS ANGELES U.S. restaurant operators would probably not replace workers with robots if they had to pay the $15 hourly wage demanded by protesters, McDonald’s Corp Chief Executive Officer Steve Easterbrook told shareholders at the company’s annual meeting on Thursday.

Outside the meeting at McDonald’s headquarters in Oak Brook, Illinois, about 1,000 fast-food workers and their supporters called for higher wages and benefits. The picketers are part of a national “Fight for $15” movement that, along with an improving job market, has spurred wage hikes at major employers such as Wal-Mart Stores Inc and McDonald’s, though not to the level demanded by protesters.

Current and former fast-food executives have said a $15 hourly wage would force restaurants to replace workers with kiosks, robotic french fry baggers, automatic pancake flippers and other technology.

“I don’t see it being a risk to job elimination,” Easterbrook said when asked about the wage/robot theory. “Ultimately we’re in the service business. We will always have an important human element.”

Easterbrook has cited improved customer service as a key reason for McDonald’s recent turnaround. Higher pay and technological advances are more likely to result in workers being shifted to dining rooms and more service-oriented roles, he said.

McDonald’s last summer increased average worker pay to almost $10 per hour. But those raises were limited to just a fraction of all U.S. McDonald’s restaurant workers because franchisees operate almost 90 percent of the chain’s 14,000 domestic locations.

Protesters, who also seek the right to unionize, called on Easterbrook to share profit gains with all McDonald’s workers, not just executives and shareholders.

They have protested at the company’s annual meeting for years. This week, their actions prompted McDonald’s to temporarily close its headquarters for the third year in a row.

“This comes down to holding McDonald’s accountable for keeping workers in poverty,” said Naquasia LeGrand, 24, who traveled 15 hours on a chartered bus from North Carolina, where she makes $8.15 an hour as a McDonald’s swing manager.

Angel Mitchell, a McDonald’s worker from Chicago, spent a rain-soaked night camping out at the company’s headquarters.

“We can’t feed our own families without turning to food stamps,” Mitchell said.

McDonald’s says it cannot tell its franchisees how to pay their employees. The issue is the subject of a closely watched case before the National Labor Relations Board.

The “Fight for $15” campaign is backed by the Service Employees International Union and also includes people who work in home care, child care, airports and higher education.

Also at the meeting, investors voted down a slate of shareholder resolutions, including those involving disclosure of political contributions and antibiotic use in meat production.

Reuters separately reported on Thursday that McDonald’s main French office was searched on May 18 as part of a tax probe. McDonald’s declined to comment on the search.

(Additional reporting by Lisa Baertlein in Los Angeles, Editing by Peter Henderson and Lisa Von Ahn)

Article source:

U.S. business spending mired in weakness, but economy picking up

WASHINGTON U.S. business spending intentions weakened in April for a third straight month amid soft demand for machinery, but a surge in contracts to purchase previously owned homes to a 10-year high supported views economic growth was gaining speed.

The growth picture was further boosted by another report on Thursday showing the number of Americans seeking unemployment benefits fell more than expected last week, pushing them back to near cycle lows.

“Overall domestic growth momentum appears to be on the mend. Nevertheless, the weak performance in business capital investment activity suggests that this segment remains a source of drag for the U.S. economic recovery,” said Millan Mulraine, deputy chief economist at TD Securities in New York.

The Commerce Department said orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, fell 0.8 percent after slipping 0.1 percent the prior month. These so-called core capital goods orders have now declined for three consecutive months.

Economists polled by Reuters had forecast core capital goods orders increasing 0.4 percent last month.

The persistent decline in these orders comes as the manufacturing sector remains pressured by lower energy prices, which have eroded profits of energy companies and forced oilfield services firms like Schlumberger (SLB.N) and Halliburton (HAL.N) to slash capital spending budgets.

Manufacturing, which accounts for 12 percent of the economy, has also taken a knock from efforts by businesses to slim down an inventory bloat, which has undercut new orders growth. A strong dollar has been a drag on exports.

Shipments of core capital goods – used to calculate equipment spending in the gross domestic product report – rose0.3 percent last month, reversing March’s 0.3 percent drop.

Much of the factory sector weakness has been concentrated in the heavy machinery segment, where manufacturers have also been hurt by reduced demand for agricultural equipment. In April, orders for machinery tumbled 1.9 percent after dropping 0.8 percent in March.

U.S. stocks were trading slightly lower after recent strong gains, while prices for U.S. government debt rose. The dollar slipped against a basket of currencies.

In a separate report, the National Association of Realtors said its pending home sales index jumped 5.1 percent last month to its highest level since February 2006. Pending home contracts become sales after a month or two, and April’s surge pointed to further gains in home resales.

The housing market is being underpinned by a tightening labor market, which is starting to lift wages, as well as still very low mortgage rates. But a shortage of properties available for sale remains a hurdle and house prices have risen faster than wages, sidelining some first-time buyers.


A third report from the Labor Department showed initial claims for state unemployment benefits declined 10,000 to a seasonally adjusted 268,000 for the week ended May 21.

Economists had forecast initial claims falling only to 275,000 in the latest week. Claims have now been below 300,000, a threshold associated with a strong job market, for 64 straight weeks, the longest stretch since 1973.

The pending homes sales and jobless claims data joined reports on retail sales, housing and industrial production in suggesting the economy was gaining steam after growth slowed to a 0.5 percent annual pace in the first quarter. The Federal Reserve Bank of Atlanta is currently estimating second-quarter GDP growth at a 2.9 percent rate.

Despite the persistent weakness in business spending, the steady stream of fairly upbeat reports could give the Federal Reserve ammunition to raise interest rates again next month.

Minutes from the Fed’s April 26-27 policy meeting, published last week, showed most officials considered it appropriate to raise rates in June if data continued to point to an improvement in second-quarter growth.

With oil prices near $50 per barrel and the dollar’s rally fading, there is hope for a manufacturing turnaround.

“Manufacturing has indeed bottomed out and with a gradual improving trend emerging, the exact degree of which remains to be ascertained in the period ahead,” said Anthony Karydakis, chief economic strategist at Miller Tabak in New York.

The Commerce Department report also showed orders for durable goods, items ranging from toasters to aircraft meant to last three years or more, jumped 3.4 percent last month after increasing 1.9 percent in March.

The rise in durable goods orders last month was led by an 8.9 percent jump in bookings for transportation equipment. Orders for civilian aircraft soared 64.9 percent. There were increases in orders for motor vehicles, fabricated metal products, computers and electronic goods, and electrical equipment, appliances and components.

Durable goods inventories declined further in April, a good sign for the manufacturing’s future prospects, while unfilled orders increased 0.6 percent. Durable goods shipments rose 0.6 percent following two consecutive months of declines.

(Reporting by Lucia Mutikani; Editing by Andrea Ricci)

Article source:

U.S. Virgin Islands sues Takata, Honda over airbags

The U.S. Virgin Islands sued Takata Corp (7312.T) and Honda Motor Co (7267.T) late on Wednesday over the sale of millions of recalled airbags linked to deadly ruptures.

The U.S. territory joins Hawaii, which earlier this month sued Takata and Honda, the largest user of recalled Takata air bags linked to 13 deaths and more than 100 injuries. The Virgin Islands suit, seeking civil and other penalties, claims the companies committed fraud, used unfair trade practices and were negligent in allowing the use of the unsafe airbags.

Virgin Islands Attorney General Claude Walker said in a statement that there are about 7,000 cars in the U.S. territory equipped with Takata airbags.

The U.S. National Highway Traffic Safety Administration has said long-term exposure in high absolute humidity areas poses the biggest risk. That includes the Virgin Islands, and Walker said a Virgin Islands resident on St. Croix was gravely injured when her Takata airbag ruptured.

“Each of these vehicles could have a ticking time bomb hidden in the steering wheel or the dash-board,” Walker said.

Honda and Takata did not immediately respond to requests seeking comment.

Takata faces an ongoing Justice Department criminal investigation. Both Honda and Takata also face class-action lawsuits from owners in a federal court in Miami, along with many other automakers that sold vehicles with Takata air bags.

Late on Wednesday, Takata confirmed it had hired Lazard Ltd to help it pursue restructuring alternatives, including seeking an outside investor.

Takata is in bailout talks with a number of potential investors, including private equity firm KKR Co, people familiar with the matter told Reuters on Thursday. The news boosted shares of the embattled auto parts maker.

Takata agreed earlier this month to expand its U.S. recall of defective airbag inflators by 35 million to 40 million, adding to the 28.8 million U.S. airbag inflators already recalled.

Of 13 deaths worldwide linked to defective Takata inflators, 12 have occurred in Honda vehicles and 10 in the United States. One death occurred in a Ford pickup involving a driver in Georgia in December.

Article source:

Cartel or talking shop? OPEC awaits Saudi ruling

DUBAI/LONDON For those seeking guidance on Saudi Arabia’s thinking regarding the future of OPEC, the last few weeks’ agenda of the new Saudi energy minister, Khalid al-Falih, might offer a few clues.

Since his appointment on May 7 as head of a new mega-ministry – overseeing energy, industry, mining, atomic power and renewables – Falih has toured six state firms, met the South Korean premier, the Canadian foreign minister and Gulf industry ministers, and opened a gas turbine plant.

To fellow members of the Organization of the Petroleum Exporting Countries, that speaks volumes. Unlike his predecessor Ali al-Naimi, Falih may not have much time for OPEC. The group meets on June 2, its first talks with the new minister in attendance.

For oil-price hawks such as Iran, Algeria and Venezuela, fears are growing that the 56-year-old OPEC is losing its role as an output-setting cartel and turning into a talking shop.

“Saudi Arabia killed OPEC and buried it,” a senior OPEC source from a non-Gulf producer said.

“In OPEC, they go for (including) Indonesia and Gabon to convert OPEC to a forum,” the source said, referring to OPEC’s decision, supported by Riyadh, to include minor producers.

As a historic reminder, OPEC last decided to change output in December 2008, when it cut supply amid slowing demand due to a global financial crisis. Between 1998 and 2008, OPEC made 27 changes to output.

For decades, Saudi Arabia, Vienna-based OPEC’s largest producer and de facto leader, had a preferred range for oil prices and, if unhappy, would try to orchestrate a group-wide production cut or increase.

But a technology-driven spike in non-OPEC output such as that of U.S. shale and growing fuel efficiency led Riyadh to conclude that the era of fast oil growth might be ending.

Hence, in the past two years Riyadh has stuck to a strategy of fighting for market share, thinking that pumping more oil now at low prices is better than producing less in the future.

Many OPEC members – apart from Riyadh’s allies in the Gulf, such as Qatar, Kuwait and the United Arab Emirates – were unprepared for that shift, with their finances crippled by heavy debts and stagnant production.

Venezuela and Nigeria pressed Saudi Arabia to agree to price-boosting output cuts, and even Riyadh’s arch-rival Iran is signaling it will be ready for renewed dialogue on freezing production once it reaches pre-sanctions levels.

“Of course, the issue of the role of OPEC can be raised. Some members want OPEC to play a more significant role in managing the market,” said an OPEC delegate from one of the main producing countries in the Middle East.

Earlier this year, Iran refused to join an initiative to freeze output but signaled it would be part of a future effort once its production had recovered sufficiently.

An OPEC watcher said: “Other producers are going to want to come and revive the freeze agreement. Iran is now at pre-sanctions levels. And though the worst has been avoided, the reality is that many of these producers remain under real stress.”


Saudi and Iranian OPEC delegates clashed earlier this month over long-term strategy, with Riyadh saying OPEC should not manage the market and Tehran arguing that the group had been created to perform precisely that task.

The tensions come amid a backdrop of worsening relations between Riyadh and Tehran, which are fighting proxy wars in the Middle East, including in Yemen and Syria.

To be sure, OPEC has weathered internal strife and conflict before – such as in the 1980s, when Iran and Iraq were at war. It has been through periods that saw it fail to influence prices such as the 1990s – only to return and control the market.

But it is hard to see OPEC regaining its grip, unless the Saudi position – driven by Falih’s ultimate boss, Deputy Crown Prince Mohammad bin Salman – changes dramatically.

Falih’s tasks – his ministry is to oversee half of the economy, not to mention plans for a share listing in state oil giant Saudi Aramco – are likely to divert more of his time away from OPEC.

“That is going to keep Falih busy and I imagine his priorities will be economic reforms and integrating new portfolios,” said Richard Mallinson, geopolitical risk analyst at the think-tank Energy Aspects.

OPEC has no supply target. At its last meeting in December the group scrapped its output ceiling of 30 million barrels per day, which it had been exceeding for months.

OPEC sources and analysts say they expect the group’s meeting next Thursday simply to roll over output policy, which OPEC lacks anyway as its members pump at will.

“I don’t think there will be a change in position. There will be no agreement on an output freeze,” said another OPEC delegate from a key Middle East oil producer.

For a busy man such as Falih, long discussions among fellow ministers with no guaranteed serious outcome might seem pointless.

So could he simply stand up and say Saudi Arabia sees no need to remain part of OPEC?

“Leaving international groups isn’t something most countries do lightly. I don’t believe the Saudis think OPEC will never be relevant again. Plus, it is hard to see what they would stand to gain from it,” Mallinson said.

(Writing by Dmitry Zhdannikov; Editing by Dale Hudson)

Article source:

Automakers, tech companies decide to make deals, not war

DETROIT A flurry of deals between big automakers and ride hailing and transportation startups is rewriting the playbook in the contest to control the future of personal transportation.

Automakers now recognize they may turn ride-hailing services and car sharing companies into steady customers for all sorts of vehicles, particularly hybrid and electric cars, industry executives and analysts say.

Tie-ups with carpooling services or short-term rental companies help automakers expose consumers to brands they might otherwise ignore. Technology companies offer access to troves of consumer data, and sophisticated ways to analyze them.

From the automakers, the Silicon Valley mobility companies obtain fresh capital, access to auto industry engineers who know how cars work and discounts on vehicles for their drivers.

In the latest tie-up between an automaker and a transportation technology startup, German luxury car maker BMW AG said on Wednesday its BMW iVentures venture capital arm has invested an undisclosed amount in California-based Scoop Technologies, which offers a smartphone-powered carpooling service called Scoop.

On Tuesday, Toyota Motor Corp, the world’s No. 1 automaker by vehicle sales, said it was investing an undisclosed amount of money in Uber. Germany’s Volkswagen AG (VOWG_p.DE) said on the same day it would invest $300 million in Gett, a smaller ride-hailing company.

Earlier this year, General Motors Co acquired a stake in Uber rival Lyft, and the Detroit automaker is launching its own car-sharing and mobility ventures under the Maven brand. Ford Motor Co, Daimler AG and other major automakers have unveiled efforts to embrace ride-hailing and car-sharing services.

Automakers “want to make sure they are in the game,” as more consumers use ride sharing or carpooling, said Mark Short, an Ernst and Young partner who advises automakers on transactions. “To be in the game, you have to make investments in these companies.”


In the case of Uber and Toyota, both could benefit from an alliance.

Uber “actually knows very little from its own experience about cars – how they’re made, how they work,” said Jan Dawson, technology analyst with Jackdaw Research. Uber has said it wants to develop self-driving cars – as does Toyota – and the two indicated they will collaborate on research.

Toyota said it expects to offer new ways for Uber drivers to buy Toyota cars, and could market Toyota and Lexus brand vehicles to Uber in bulk fleet sales. Details of these programs have yet to be decided, a Toyota spokesman said on Wednesday.

Toyota and some rival automakers currently offer discounts to drivers for Uber and its ride-hailing rival, Lyft. An Uber driver who wants to buy a Toyota Prius, for example, could receive a $750 discount. The Uber discount for a Ford Focus is $2,100, according to information on Uber’s website.

Uber said on Wednesday discounts from various automakers have saved its drivers more than $20 million on vehicle purchases globally as of the end of last year. As of last December, more than 50,000 people around the world had used its car discount program, Uber Vehicle Solutions, to buy or lease vehicles worth over $1 billion.

Ride hailing and car sharing companies could become outlets for automakers trying to sell more electric vehicles, or hybrid cars, to earn credits under U.S. federal and state environmental rules. The high costs of an electric car battery are more rapidly offset by ferrying passengers around a city all day than by a routine round-trip commute.

GM executives say Lyft will be an important customer for the automaker’s Chevrolet Bolt electric car, due to launch late this year.

BMW’s investment in Scoop is also aimed at selling vehicles, Ulrich Quay, managing director of BMW iVentures, said on Wednesday. Ride sharing can help the automaker get to know customers who have never driven a BMW, he said.

The Scoop application connects people who live in the same neighborhoods and work near each other to arrange carpools. The company currently operates in the San Francisco Bay area.

(Reporting by Paul Lienert and Joseph White in Detroit, Heather Somerville and Alexandria Sage in San Francisco; Editing by Michele Gershberg and Matthew Lewis)

Article source:

Starbucks to open first coffee roastery outside U.S. in Shanghai

Starbucks Corp (SBUX.O), the world’s biggest coffee company, said on Thursday it would open a coffee roastery in Shanghai, China in 2017, its first outside the United States.

The company currently operates only one such roastery in Seattle, which it opened in 2014. It has signed leases to open one more in New York.

Starbucks has been investing heavily in China, the company’s largest market outside the United States, despite signs of slowing growth.

The company said in April that business in China remained strong even as its economy cools.

(Reporting by Ramkumar Iyer in Bengaluru; Editing by Sriraj Kalluvila)

Article source: