BUSINESS BRIEFS
American Air plan could lay off more than 6,800
Associated Press
DALLAS — Many more job cuts, likely totaling more than 6,000, are likely at American Airlines as the nation's biggest airline hunkers down and tries to survive record high fuel costs.
American notified its flight attendants union Wednesday that it will cut up to 900 jobs starting Aug. 31, but that appears to be the tip of the iceberg.
Although American has not given a total figure, the airline says it expects to shed 8 percent of its workforce. With about 85,500 workers, including those at sister airline American Eagle, that would represent more than 6,800 jobs.
"The mood is fairly glum," said Karl Schricker, an American pilot and union spokesman. "They brought back 30 furloughed pilots in June. Those guys quit other jobs to come back ... and now they wonder if they'll be out the door."
American plans to cut domestic capacity 11 percent to 12 percent this fall. Including international flying, that translates to a pullback of about 8 percent.
EX-HEAD OF REFCO GOING TO PRISON
NEW YORK — The former head of Refco Inc., blamed for the collapse of one of the world's largest commodities brokerages, was sentenced to 16 years in prison yesterday by a judge who decried the "staggeringly arrogant" greed of white-collar criminals.
Phillip Bennett, 59, a British citizen living in Gladstone, N.J., had previously pleaded guilty to conspiracy to commit securities fraud and other charges for the eight-year fraud.
Bennett said he didn't mean to hurt anyone. His voice cracked when he apologized to his family for their "unimaginable agony."
CHRYSLER FACED WITH BANKRUPTCY
DETROIT — Faced with soaring gas prices, a sputtering economy and a rapid U.S. market shift away from trucks, the U.S. auto industry's weakest player, Chrysler, may have to file for bankruptcy or sell its storied Jeep and Dodge Ram brands as early as next year, JPMorgan said yesterday.
But rivals GM and Ford are likely to get through the rough patch and turn a profit in 2010.
JPMorgan auto analyst Himanshu Patel dismissed the possibility of an imminent bankruptcy at GM, saying in a conference call with investors and media that such fears "are completely overblown." The day before, GM shares slid to a 54-year low after Merrill Lynch auto analyst John Murphy wrote in a note to investors that a GM bankruptcy "is not impossible if the market continues to deteriorate and significant incremental capital is not raised."
Patel said the situation at Chrysler LLC is far more perilous because it has limited assets to raise cash and is more heavily reliant on trucks and on the North American market. Chrysler sales fell 22 percent in the first six months of this year.
MISTRIAL RETURNS LAWYERS TO JAIL
COVINGTON, Ky. — Two lawyers accused of defrauding their clients in a diet-drug settlement of $65 million were sent back to jail yesterday after a jury deadlocked and a federal judge declared a mistrial.
The jury had considered the case against suspended lawyers William Gallion and Shirley Cunningham Jr. for eight days, and twice in two days sent out notes indicating it was stumped. A third defendant, Melbourne Mills Jr., was acquitted earlier this week. All faced a single charge of conspiracy to commit wire fraud.
ECB PRESIDENT UPS INTEREST RATE
FRANKFURT, Germany — Wary of higher energy and commodity prices, the European Central Bank raised its benchmark interest rate yesterday by a quarter percentage point to 4.25 percent, a move it hopes will help curtail rising inflation in the 15 countries that use the euro.
The move comes despite worries in some quarters that it could dampen growth, but ECB President Jean-Claude Trichet said the fundamentals of Europe's economy "are sound."
