News Archive


Clouds gather in rooftop solar’s biggest U.S. market


SAN DIEGO For years, the quiet, winding streets of the Scripps Ranch neighborhood have been pure gold for solar installers.

Thanks to its high power prices, hot summers and large homes to cool, a greater share of Scripps Ranch residents have embraced solar power than anywhere else in California, itself the nation’s solar energy leader.

The rooftops of some 2,000 homes – 26 percent – are fitted with panels in Scripps Ranch, according to an analysis of state and utility solar installation numbers and U.S. Census Bureau housing data by the non-profit Center for Sustainable Energy and the environmental news web site EcoWatch.

The growth has been rapid. In July of 2014, San Diego installer Sullivan Solar put up its first solar system on Scripps Ranch’s Pinecastle Street, celebrating with a block party. The pizza and wine paid off: Sullivan installed systems on 11 of 48 homes on the street.

“If you can afford the upfront, it’s a no brainer,” said Caroline Coats, a nearby resident who hired Sullivan to install a solar system four years ago.

As much as Scripps Ranch symbolizes rooftop solar’s success, it also illustrates the challenges facing the industry today. After rising 64 percent in the first half of the year in Scripps Ranch, installations tumbled 50 percent in July and August combined, according to utility data. Across California, growth also has slowed this year, and, in the third quarter, installations dropped year over year.

Industry watchers say many factors are at play, including shrinking incentives, wariness of future government actions and consumer fatigue with marketing tactics. Also, many of the most likely buyers – affluent, environmentally inclined homeowners in sunny places – already have rooftop systems, making winning new customers harder and costlier.

LESS INCENTIVE

California for years has required utilities to purchase excess rooftop solar power, paying homeowners in credits that lower their utility bills. But this so-called “net-metering” mandate capped the number of people who qualified for the most attractive incentive. In June, the utility serving Scripps Ranch, Sempra Energy (SRE.N) unit San Diego Gas Electric, was the first to reach its limit, and the state’s other large utilities are expected to reach theirs soon.

Scripps Ranch homeowners who put up panels now still will be able to sell power they don’t use to the utility at the same retail rates as those who got in before the cap. But they will have to pay $100 to $200 more per year in fees and charges to SDGE. They also eventually will be shifted to new, time-of-use power rates, which could result in lower credits.

Installers say such changes will be meager compared to the thousands of dollars in savings over the life of a system. But customers seem skeptical. At the peak, installers were putting up 55 systems a month, on average, in Scripps Ranch. In July and August – typically good months – installations dropped to 15 and 36, respectively.

Residential solar connections were down 25 percent in the third quarter compared to a year earlier in the utility’s entire San Diego territory.

“The phones just aren’t ringing as much,” said Ian Lochore, director of residential sales at Baker Electric in nearby Escondido.

A less dramatic slowdown is playing out across California, which produces about 40 percent of the nation’s residential solar.

The sector saw slower growth in the first half of the year, and declines in the third quarter. Installations in Pacific Gas Electric’s service territory in Northern and Central California fell 7 percent year-over-year, while in Southern California Edison’s territory they fell 4 percent.

National installers like SolarCity Corp (SCTY.O) and Sunrun Inc (RUN.O), whose investors had gotten used to sky-high growth rates, slashed forecasts this year, while their stocks have been pummeled. SolarCity has agreed to be bought by electric car maker Tesla Motors Inc (TSLA.O), but investors have concerns about the wisdom of merging two companies that require substantial cash to fund growth.

   

FEWER POTENTIAL CUSTOMERS

    Now that many of the homeowners best-positioned to benefit from rooftop installations have them, today’s pool of potential customers has less incentive to go solar.

    “A lot of the early adopters have gone solar already, so the market is kind of shifting toward people who might need more information or explanation before they make the shift,” PGE spokeswoman Ari Vanrenen said.

In Scripps Ranch, for instance, many homeowners without solar say their power bills are too low, or their rooftops too shady.

Ken Ingrao, a Scripps Ranch resident who said he did “tons of research” about solar, decided his $220-a-month power bill was too low to justify an investment of up to $28,000.

“It’s a good option for people who are spending … $800 a month putting the air on 24-7,” Ingrao said. “But we don’t do that.”

Working harder to win customers has raised costs. Both SolarCity and Sunrun reported large increases in sales and marketing costs in the first half of the year compared with 2015. Customer acquisition costs could rise further this year, GTM Research said.

More aggressive marketing carries risks, however.

Some solar vendors “come across as used car sales people,” said Vikram Aggarwal, chief executive of EnergySage, an online comparison-shopping marketplace for solar.

“A lot of consumers tell us that their first interaction with solar was negative,” he said.

Nearly 300 people filed solar-related complaints with the state last year, an increase of 25 percent, according to the California Contractors State Licensing Board, which pledged to step up enforcement.

BIGGEST COMPANIES HARDEST HIT

    The slowdown is having the greatest impact on the industry’s biggest installers.

A drop in installations in regions served by SCE and PGE between the first and second quarters of this year mostly involved U.S. installer SolarCity, a GTM Research analysis of installation data showed. Sunrun installations were flat, while local and regional installers, on average, showed growth.

SolarCity spokesman Jonathan Bass blamed lackluster performance in the second quarter on the fact that it was leasing installations to customers rather than offering a loan to purchase. Demand for a loan option introduced in the second quarter has increased every month, Bass said, adding that California sales, which includes leased and purchased systems, rose in the third quarter compared with the second quarter.

Sunrun Chief Executive Lynn Jurich would not comment on her company’s third quarter performance but said in an emailed statement that the industry “does face some headwinds from time to time that can include anything from seasonality to uncertainty created in consumers’ minds when we go through regulatory change.”

Sunrun believes there are five times as many “solar-ready homes” in California than have gone solar, Jurich added.

Both SolarCity and Sunrun have said new products, such as energy storage and the “solar roofs” SolarCity is expected to unveil later this week, will create new growth.

(Reporting by Nichola Groom; Editing by Sue Horton and Lisa Girion)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/r6gZbRwmkhw/us-usa-solar-rooftop-idUSKCN12Q0C1

Toyota to recall 5.8 million cars in Japan, China, Europe over Takata airbags


TOKYO Toyota Motor Corp (7203.T) on Wednesday said it was recalling about 5.8 million cars at home and abroad over potentially faulty air bag inflators made by Takata Corp. (7312.T), including those used as replacement parts following a 2010 recall.

Automakers worldwide are ramping up the industry’s biggest-ever recall after parts supplier Takata, under pressure from U.S. authorities, agreed earlier this year to declare more of its air bags as defective in the United States and other countries.

The air bag inflators in question use a chemical compound which can explode with excessive force after prolonged exposure to hot conditions, and have been linked to at least 16 deaths globally, mainly in the United States.

Toyota’s latest recall includes the Corolla, one of the world’s best-selling models, and the Vitz or Yaris subcompact hatchback model. It covers driver-side and passenger-side airbags installed in cars produced between May 2000 and November 2001, and April 2006 and December 2014, the company said in an email.

It affects about 1.16 million vehicles sold in Japan, about 820,000 cars sold in China and around 1.47 million cars in the European market.

The recall extends to Central and South America, Africa, the Near and Middle East and Singapore, and also includes the Hilux pick-up truck and the Etios line of sedans and hatchbacks.

The move shows the complicated nature of the inflator recall, which began around 2008 and continues to expand.

The latest recall includes about 20,000 cars which were fitted with replacement Takata inflators following an initial 2010 recall, as the replacement parts are also seen to be at risk of exploding as they do not contain a drying agent.

Transport authorities around the world now consider inflators without a drying agent to be unsafe, and have ordered all of them to be withdrawn.

Since global transportation authorities expanded their recall from May, about 100 million Takata air bag inflators have been classified as defective worldwide.

Takata is seeking a financial investor to help pay for huge liabilities from the recall, and has been meeting with potential sponsors and automaker clients to discuss its survival options.

(Reporting by Naomi Tajitsu and Maki Shiraki; Editing by Stephen Coates)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/Ji54Tt1Vtq4/us-toyota-recall-idUSKCN12Q0DB

Vodafone UK fined a record 4.6 million pounds for failing customers


LONDON Britain has fined Vodafone (VOD.L) a record 4.6 million pounds ($5.60 million) for “serious and sustained” customer failures, including not updating accounts when mobile phone users topped up their credit to make calls.

Vodafone, the world’s second-largest mobile operator, also failed to act quickly enough to identify or address the problems, the regulator said, which stemmed from a move to a new billing system.

Some 10,452 of the mobile phone giant’s pay-as-you-go customers collectively lost 150,000 pounds over a 17-month period between the end of 2013 and April 2015.

Vodafone said it deeply regretted the system and process failures and had refunded the vast majority of the affected customers.

Ofcom’s Lindsey Fussell said the failings were “serious and unacceptable” and the fines, which are the highest ever imposed by the regulator, sent a clear warning to all telecoms companies.

“Phone services are a vital part of people’s lives, and we expect all customers to be treated fairly and in good faith,” she said on Wednesday.

Vodafone said all but 30 customers had been fully refunded or re-credited, with an average refund of 14.35 pounds, and it donated 100,000 pounds to charity to ensure it did not profit from the 30 customers it could not track down.

“This has been an unhappy episode for all of us at Vodafone: we know we let our customers down,” the company said. “We are determined to put everything right.”

Vodafone said it was confident its customers were already beginning to see the benefits of its investment in its new systems.

Britain’s regulators have stepped up the pressure in recent years to make sure customers are being protected. Ofcom said in September that Sky (SKYB.L), Britain’s biggest pay-TV group, may have violated consumer rules by making it too difficult for customers to cancel or switch providers.

(Reporting by Paul Sandle; editing by Kate Holton)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/_v3yorhOues/us-vodafone-group-britain-fine-idUSKCN12Q0HC

Lighten up: tech firms take on economy-class flight challenge


SINGAPORE Some start-ups are taking on one of air travel’s last undisrupted bastions – the economy-class cabin. While first and business class travelers have long enjoyed comfort upgrades, there’s been less attention to innovation at the rear of the plane. “We want to make travel memorable and comfortable for all of us, not just the top 1 percent,” Alireza Yaghoubi, founder of Singapore-based AirGo, told a recent start-up conference to pitch his superlight economy-class seat. He’s not alone. Half a dozen firms are pitching something similar, wanting to make seats more comfortable, improve cabin lighting, make it easier to use and charge mobile devices on flights, and even upgrade the humble food trolley.

They are trying to penetrate an industry eyeing significant growth on the back of strong jetliner demand, illustrated by this week’s $6.4 billion deal for Rockwell Collins (COL.N) to take over B/E Aerospace (BEAV.O), an interiors manufacturer.

Persuading the airline industry to upgrade, however, is a tough ask. In a fiercely competitive market and with single-digit margins, carriers have gone as far as they can with economy-class innovation, says Anthony Harcup of Acumen, a UK design house that works with planemakers and airlines. “Right now, we’ve designed ourselves into a corner with the current economy format,” he says. “It’s about as tight and tiny as you’re going to get it. So something has to give, and it’s difficult to see what that is.” Acumen, which designed the world’s first flat bed for British Airways (ICAG.L) 20 years ago, has had only two of its in-cabin concepts lie unused: both involved re-thinking the form and layout of economy-class seats. But that’s not stopping a new generation of outsiders working with new materials and technologies to make economy class, if not luxurious, at least more bearable.

FLAX SEED TROLLEY

AirGo’s Yaghoubi, for example, vowed to do something about airline seats when he flew back to his native Iran on its national airline and noticed the seats hadn’t been replaced since the plane was bought 40 years ago. “Actually, they were quite a lot more comfortable” than today’s seats, he said.

The latest prototype of his seats, he says, offers a wider back rest by having smaller elbow rests that fold down rather than up, and has better head support. Extra leg room is created by moving the literature pocket and improving the seat posture to have people sit more upright.

But these firms realize they can’t just pitch their seats on comfort alone.

UK-based Rebel.Aero, for example, promises to speed up boarding and integrate a child seat by letting the seat slide upwards, like an inverted cinema seat. This frees up space for passengers to move in and out and stretch their legs. Founder Gareth Burks says he’s halfway through getting certification and has delivered sample seats to some aircraft manufacturers.

AirGo is counting on airlines liking that its seats are made of carbon fiber composites, where fibers are braided like hair, creating a hollow structure that halves their weight.

Others are experimenting with other materials. France-based Expliseat has announced Air Tahiti as the first customer for its titanium seats, freeing up the equivalent weight of up to four passengers.

And UK-based FlightWeight has redesigned the food trolley, ditching the usual aluminum casing for mostly flax seed waste, volcanic rock, sugar and water – making it almost a third lighter.

OBSTACLES, GRUMBLES

Changing consumer habits also offer airlines a chance to shed weight.

Most passengers would prefer to use their own mobile device, says Fred Cleveland, former vice president at American Airlines and now an adviser to PricewaterhouseCoopers. This allows some airlines to ditch some expensive and heavy wiring and hardware, and convert seats into charging stations.

Cobalt Aerospace, another UK-based design firm, offers ways to customize seats, including wireless charging in tray tables and arm rests.

This could be bad news for suppliers of in-flight entertainment systems such as Thales (TCFP.PA) and Panasonic (6752.T). Singapore Airlines’ (SIAL.SI) budget subsidiary Scoot has already abandoned traditional seat-back consoles in favor of pre-loaded iPads.

But there are obstacles for start-ups.

A lot has already been spent by companies such as Germany’s Recaro and France’s Zodiac Aerospace (ZODC.PA) on making seats as light as possible by using advanced materials. Many leading airlines are already installing them.

But production bottlenecks in the interiors industry highlight the challenges it faces in keeping up with demand, and may make airlines wary of gambling on untested suppliers.

Persuading airlines to spend more isn’t easy, says Martin Darbyshire of UK-based Tangerine, which customized the head rests in Cathay Pacific’s (0293.HK) A350 economy seats. Cathay was willing to make the changes, he said, because it makes money from economy. “But for most other airlines the costs are prohibitive.”

Maybe the biggest hurdle is certification.

There are strict rules about what can and can’t be done, and any tweaks require approval. When one airframe maker reduced the weight of the tracks where seats slot in, it found itself having to restore all the saved weight to ensure the design met certification requirements, said Darbyshire. “It becomes a vicious circle.”

Part of the problem is that while passengers grumble about economy-class travel, they are sensitive to price and don’t differentiate much on features, says Acumen’s Harcup. Unlike booking a hotel, he says, where cost is just one of many metrics a customer looks at – internet access, parking, a pool – when it comes to the airline seat “the passenger is confronted with one metric and that’s cost. So it’s no wonder we’re in the situation we’re in.”

(Reporting by Jeremy Wagstaff, with additional reporting by Tim Hepher; Editing by Ian Geoghegan)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/T7BXudIZoUQ/us-tech-airlines-economy-idUSKCN12P324

Exclusive: Slim in talks with Spanish firms for bid on $3.5 billion Mexico airport terminal


MEXICO CITY/MADRID Tycoon Carlos Slim’s construction arm is in talks with his majority-owned construction firm FCC and rival Spanish builder Acciona to jointly bid on a coveted $3.5 billion (2.87 billion pounds) Mexico City airport terminal project, five people familiar with the matter said.

Carso Infraestructura y Construccion, part of Slim’s Grupo Carso, is hashing out a deal to form the consortium, which would include three other Mexican companies – all its partners from a winning bid for one of the airport’s runways, four of the people said in recent days, speaking on condition of anonymity.

The bid for the terminal, hot on the heels of Carso’s runway bid, shows how Slim, Mexico’s wealthiest man, is aggressively moving to boost his construction business as his telecoms arm America Movil is squeezed by increased competition and regulation.

The futuristic airport building was designed by Slim’s son-in-law Fernando Romero and British architect Norman Foster.

It would anchor a $13 billion airport aimed at turning Mexico City into a regional hub, expected to serve 68 million passengers a year when it begins operating in 2020.

Carso, together with the construction unit of Mexico’s Grupo Hermes and builders Constructora Y Edificadora GIA+A (GIA), and Promotora y Desarrolladora Mexicana, S.A. de C.V. (Prodemex), clinched the runway project last month with a bid worth 7.36 billion pesos ($396 million).

One of the sources said the Carso-led bidding consortium was close to being finalised. Proposals are due next month. Another source said that the companies were eyeing equal stakes for the members of the consortium.

An Acciona spokesman said the Spanish builder was analyzing the operation, adding that the bidding consortiums were still being formed.

FCC and Carso declined to comment.

Hermes, Prodemex, GIA did not respond to requests for comment.

In June, Spanish regulators approved Slim’s takeover of FCC, which has been dealing with high debts following a 2008 property market crash that sent thousands of the country’s developers to the wall and brought the firm close to bankruptcy.

Clinching the project is far from certain. Reuters reported in August that debt-laden Mexican builder ICA is in final talks to bid with Spanish firms Ferrovial, Dragados, a unit of Spain’s Grupo ACS and GP Construccion, a Monterrey-based company, to build the terminal.

Ferrovial is well placed to make the winning bid after clinching a 2010 contract to build a terminal at London’s Heathrow Airport for around 800 million pounds.

Ferrovial’s Spanish rivals also have experience; Sacyr, FCC, Acciona, Ferrovial and Dragados completed construction of the Madrid-Barajas Airport Terminal 4 in 2006 for more than 4 billion euros.

The bidding groups remain in flux, with two sources saying ICA could join the Carso-led consortium in a decision that could be reached by next week.

The Mexican airport project has survived steep budget cuts to confront declining oil revenues, including the cancellation of two passenger train projects last year.

One of the train projects, won by a Chinese-led consortium that included Gia and Prodemex, became a major scandal for Pena Nieto after it emerged that another consortium member, Grupo Higa, owned a luxury home the first lady was acquiring.

(Additional reporting by Robert Hetz in Madrid; Editing by Christian Plumb and Lisa Shumaker)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/P0WOe7HQnYc/us-mexico-slim-exclusive-idUSKCN12P31J

White House urges ban on non-compete agreements for many workers


The Obama administration on Tuesday called on U.S. states to ban agreements prohibiting many workers from moving to their employers’ rivals, saying it would lead to a more competitive labor market and faster wage growth.

The administration said so-called non-compete agreements interfere with worker mobility and states should consider barring companies from requiring low-wage workers and other employees who are not privy to trade secrets or other special circumstances to sign them.

Vice President Joe Biden in a statement said he had heard from a teacher in Nebraska who was barred from taking a summer job selling pet food to earn extra money. Among others, Biden also mentioned a salesman in Connecticut who was laid off and forced to spend his retirement savings because he was prohibited from accepting other sales jobs.

“(Workers) can’t reach their true potential without freedom to negotiate for a higher wage with a new company, or to find another job after they’ve been laid off,” Biden said.

Nearly every state allows non-compete agreements, and legal battles over their validity are common. Courts in determining whether the agreements are lawful generally focus on the length of time they are in effect, their geographical limits and whether employees had access to trade secrets.

The issue drew attention from some lawmakers and advocacy groups in June when the attorney general of Illinois filed a lawsuit claiming non-compete agreements signed by employees of fast-food franchise Jimmy John’s were unlawful. The company said it would stop using the agreements in order to settle the case.

The Obama administration on Tuesday also urged states to ban non-compete agreements that are not proposed before a job offer or promotion is accepted and said employers should not be able to enforce the agreements when workers are laid off.

The White House said 20 percent of U.S. workers are bound by non-compete agreements, including 14 percent of those earning less than $40,000 per year.

But many businesses have legitimate reasons for requiring workers to sign the agreements, and states should not simply ban them for wide swaths of the work force, Beth Milito, senior legal counsel at the National Federation of Independent Business, said in an interview on Tuesday.

“There need to be individualized assessments of the agreements that consider the industry and the geographical location,” she said.

(Reporting by Daniel Wiessner in Albany, New York; Editing by Tom Brown)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/TrYO-wGaoks/us-usa-noncompetes-idUSKCN12P2YP

Wall Street slips on earnings; Apple falls late after results


NEW YORK U.S. stocks slipped from two-week highs on Tuesday as results and forecasts from companies in sectors including housing and consumer products failed to live up to expectations.

Apple (AAPL.O), the largest U.S. company by market capitalization, posted after the bell better-than-expected iPhone sales that however continued a declining trend and shares fell about 2 percent, briefly dragging SP 500 futures ESc1 to session lows.

During the regular session, Whirlpool (WHR.N), down 10.8 percent to $152.09, cited soft demand as it posted lower-than-expected earnings and gave an underwhelming forecast. Sherwin Williams’ (SHW.N) outlook also disappointed Wall Street and shares fell 10.9 percent to $247.61.

Both were an indication to some analysts that the housing sector may be cooling.

“Lackluster results from Whirlpool and Sherwin Williams may indicate a slowing in the housing cycle,” said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.

She said those results could be weighing on Home Depot (HD.N), which was down 3.5 percent at $123.34 as the largest points decliner on the SP 500. Lowes Cos (LOW.N) fell 3.5 percent to $68.47.

Consumer products company Procter Gamble (PG.N) rose 3.4 percent to $86.97 after reporting a better-than-expected quarterly profit, while sportswear maker Under Armour (UA.N) fell 13.2 percent to $32.89 after it reported its slowest quarterly sales growth in six years.

“We had a rally (Monday) and haven’t been able to sustain it, due to weaker-than-expected numbers from some names,” said Peter Jankovskis, co-chief investment officer at OakBrook Investments in Lisle, Illinois, calling the day’s earnings a “mixed bag.”

Overall, annualized third-quarter earnings from SP 500 companies are expected to have risen 1.7 percent, effectively putting an end to an earnings recession, according to Thomson Reuters I/B/E/S.

Of the 150 companies that have reported so far, 75.3 percent have beaten analyst expectations, above the long-term average of 63.5 percent.

The Dow Jones industrial average .DJI fell 53.76 points, or 0.3 percent, to 18,169.27, the SP 500 .SPX lost 8.17 points, or 0.38 percent, to 2,143.16 and the Nasdaq Composite .IXIC dropped 26.43 points, or 0.5 percent, to 5,283.40.

Futures were also pressured after the bell by a late decline in oil prices CLc1 LCOc1 after data showed a bigger-than-expected build in U.S. crude inventories.

3M (MMM.N) fell 2.9 percent to $166.23 after the maker of Scotch tape and Post-it notes trimmed its full-year revenue and earnings forecasts for the second time.

Caterpillar (CAT.N) lost 1.8 percent after a downbeat forecast, while General Motors (GM.N) fell 4.2 percent amid fears regarding future profits.

Declining issues outnumbered advancing ones on the NYSE by a 1.53-to-1 ratio; on Nasdaq, a 2.17-to-1 ratio favored decliners.

The SP 500 posted 11 new 52-week highs and nine new lows; the Nasdaq Composite recorded 67 new highs and 73 new lows.

About 6.39 billion shares changed hands in U.S. exchanges, in line with the 6.4 billion daily average over the last 20 sessions.

(Reporting by Rodrigo Campos; Editing by Nick Zieminski and James Dalgleish)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/FJtJKzHsIOA/us-usa-stocks-idUSKCN12P1FU

U.S. judge approves $14.7 billion deal in VW diesel scandal


WASHINGTON A U.S. judge on Tuesday approved one of the biggest corporate settlements on record, Volkswagen AG’s (VOWG_p.DE) $14.7 billion deal arising from its diesel emissions cheating scandal, and the German automaker said it would begin buying back polluting cars in mid-November.

U.S. District Judge Charles Breyer in San Francisco signed off on VW’s settlement with federal and California regulators and the owners of the 475,000 polluting diesel vehicles in a pivotal moment for the world’s No. 2 automaker as it tries to move past a scandal that has engulfed it for more than a year.

VW admitted in September 2015 to installing secret software in its diesel cars to cheat exhaust emissions tests and make them appear cleaner in testing than they really were. In reality, the vehicles emitted up to 40 times the legally allowable pollution levels.

Volkswagen CEO Matthias Mueller told reporters in Berlin that Breyer’s approval was “an important milestone for us on the way towards clearing up the problem that we caused some time ago.” Hinrich Woebcken, president and CEO of Volkswagen Group of America, pledged to carry out the terms “as seamlessly as possible.”

Breyer turned away objections from car owners who thought the settlement did not provide enough money, saying it “adequately and fairly compensates” them. Owners will get the pre-scandal “trade in” value of the vehicle and $5,100 to $10,000 in additional compensation.

“Given the risks of prolonged litigation, the immediate settlement of this matter is far preferable,” Breyer wrote.

Volkswagen agreed to spend up to $10.033 billion on the buybacks and owner compensation and $4.7 billion on programs to offset excess emissions and boost clean-vehicle projects.

The settlement was reached with the U.S. Justice Department, Federal Trade Commission, the state of California and vehicle owners who had filed a class action lawsuit against VW. Volkswagen has admitted to misleading regulators and still faces an ongoing criminal investigation.

It represented the largest civil settlement worldwide ever reached with an automaker accused of misconduct.

While huge, the approved deal was still smaller than the $246 billion settlement reached by cigarette makers with 46 U.S. states in 1998 and the $53 billion by BP to address costs and penalties arising from the 2010 Gulf of Mexico oil spill.

In total, Volkswagen has agreed to date to spend up to $16.5 billion in connection with the scandal, including payments to dealers, states and attorneys for owners. The scandal rattled VW’s global business, harmed its reputation and prompted the ouster of its CEO.

The settlement covers 2.0-liter polluting diesel Beetle, Golf, Jetta, Passat and Audi A3 cars from the 2009 through 2015 model years. Up to 490,000 people will take part in the settlement because some vehicles had multiple owners.

Volkswagen spokeswoman Jeannine Ginivan said the automaker expects to begin buying back vehicles in mid-November. VW has hired 900 people, including one to be stationed at each dealership, to handle buybacks.

MORE COSTS FOR AUTOMAKER

VW still faces billions more in costs to address 85,000 polluting 3.0-liter vehicles and Justice Department fines for violating clean air laws. It also faces lawsuits from at least 16 U.S. states for additional claims that could hike the company’s overall costs.

Last month, a Volkswagen engineer pleaded guilty in Detroit to helping the company evade U.S. emission standards. His lawyer said he would cooperate with federal authorities in their criminal probe.

Kathryn Phillips, California director for the Sierra Club environmental group, said Volkswagen broke the law and that “Judge Breyer is making them pay the price. Volkswagen chose to poison our families with dangerous pollution just to pad its pocketbook.”

“Today is a landmark day, when this innovative settlement can be put into action, investing billions of dollars into public health protections to remedy these serious violations,” added Cynthia Giles, U.S. Environmental Protection Agency assistant administrator.

VW will provide $2 billion over 10 years to fund programs to promote electric vehicle charging infrastructure, development of zero-emission ride-sharing fleets and other efforts to boost sales of cars that do not burn petroleum.

Volkswagen has been in intensive talks over how much compensation it may offer owners of the larger 3.0-liter diesel Porsche, Audi and Volkswagen vehicles that emit up to nine times legally allowable emissions and whether it will offer buybacks for some of the polluting SUVs. No final agreement has been reached. Volkswagen faces a Nov. 3 court hearing to update the court on those vehicles’ status.

Volkswagen agreed to make up to $1.21 billion in payments to 652 U.S. VW brand dealers and $600 million to 44 U.S. states to address some state claims.

Nearly 340,000 owners have registered to take part in the settlement. About 3,500 owners have opted out. Volkswagen must fix or buy back 85 percent of the 475,000 vehicles under the agreement by June 2019 or face additional costs.

Owners have until September 2018 to submit paperwork to sell back vehicles. VW will have to destroy repurchased vehicles unless it wins approval for fixes.

(Reporting by David Shepardson in Washington and Andreas Cremer in Berlin; Editing by Will Dunham)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/vGKJcKABAe0/us-volkswagen-emissions-idUSKCN12P22F

Target to offer more deals, extend free shipping until January


NEW YORK Target Corp (TGT.N) will offer more deal-driven promotions and extend its free shipping window to January this holiday season as it looks to turn around performance in what has so far been a lackluster year for the retailer.

Target also expects consumer spending to remain robust in November and December despite uncertainty around the U.S. presidential elections. The holiday shopping season is an important time for retailers during which they earn an outsized portion of their annual profits and sales.

“We are looking at very low unemployment, fuel prices remain low, the commodity pressure on food is down,” Chief Executive Officer Brian Cornell told reporters in a meeting on Tuesday. “The overall approach for the consumer is going to be positive this season.”

Improving performance during the holiday months is crucial for Target. After a slow first half of the year, the retailer has warned of flat or slightly lower same-store sales for the second half of 2016, as shoppers turn to the internet and spend on big-ticket items like cars and home renovations, rather than small, discretionary purchases that make up the bulk of Target’s offerings.

The Minneapolis-based retailer said it will offer more deals this year under its program “Ten Days of Deals.”

Target will also extend its free shipping offer until Jan. 1 this year from Dec. 25 last year and drop shipping fees for all online orders for a third year in a row. The retailer currently requires a minimum online order of $25 to qualify for free shipping.

Free shipping boosted Target’s digital sales growth to over 30 percent during the fourth quarter last year and is a key strategy that allows it to better compete with rivals like Amazon.com Inc (AMZN.O).

Target expects its ship-from-store program, which it has expanded to 1,000 stores from over 400 last year, to speed up delivery times.

The retailer also said it would increase its holiday advertising budget for television, with a special focus on Spanish-language programs, as it looks to bring in more Hispanic shoppers, a traditionally strong consumer demographic for Target.

It expects growth to be strong in the home decor, toy and apparel categories. Target will also focus on selling electronic items like the new Apple Watch. In August, the retailer said low demand for Apple Inc (AAPL.O) products hurt electronics sales during the second quarter and that it was working with the iPhone maker to capitalize on new product launches.

(Reporting by Nandita Bose in New York; Editing by Andrew Hay and Jonathan Oatis)

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