Airbus Wins China Order for 300 Jets as Xi Visits France

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Airbus signed a deal worth tens of billions of dollars on Monday to sell 300 aircraft to China as part of a trade package coinciding with a visit to Europe by Chinese President Xi Jinping and matching a China record held by rival Boeing.

The deal between Airbus and China’s state buying agency, China Aviation Supplies Holding Company, which regularly coordinates headline-grabbing deals during diplomatic visits, will include 290 A320-family jets and 10 A350 wide-body jets.

French officials said the deal was worth some 30 billion euros at catalogue prices. Planemakers usually grant significant discounts.

The larger-than-expected order, which matches an order for 300 Boeing planes when U.S. Donald Trump visited Beijing in 2017, follows a year-long vacuum of purchases in which China failed to place significant orders amid global trade tensions.

It also comes as the grounding of the Boeing 737 MAX has left uncertainty over Boeing’s immediate hopes for a major jet order as the result of any warming of U.S.-China trade ties.

There was no evidence of any direct connection between the Airbus deal and Sino-U.S. tensions or Boeing fleet problems, but China watchers say Beijing has a history of sending diplomatic signals or playing off suppliers through state aircraft deals.

“The conclusion of a big (aviation) contract … is an important step forward and an excellent signal in the current context,” French President Emmanuel Macron said in a joint address with his Chinese counterpart Xi Jinping.

The United States and China are edging towards a possible deal to ease a months-long tariff row and a deal involving as many as 200-300 Boeing jets had until recently been expected as part of the possible rapprochement.

Long-term relationship

China was also the first to ground the newest version of Boeing’s workhorse 737 model earlier this month following a deadly Ethiopian Airlines crash, touching off a series of regulatory actions worldwide.

Asked if negotiations had accelerated as a result of the Boeing grounding or other issues, Airbus planemaking chief and designated chief executive Guillaume Faury told reporters, “This is a long-term relationship with our Chinese partners that evolves over time; it is a strong sign of confidence.”

China has become a key hunting ground for Airbus and its leading rival Boeing, thanks to surging travel demand.

But whether Airbus or Boeing is involved, analysts say diplomatic deals frequently contain a mixture of new demand, repeats of older orders and credits against future deals, meaning the immediate impact is not always clear.

The outlook has also been complicated by Beijing’s desire to grow its own industrial champions and, more recently for Boeing, the U.S.-China trade war.

French President Macron unexpectedly failed to clinch an Airbus order for 184 planes during a trip to China in early 2018 and the two sides have been working to salvage it.

Industry sources have said the year’s delay in Airbus negotiations, as well as a buying freeze during the U.S. tariff row, created latent demand for jets to feed China’s growth.

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Chances of UN Banning Killer Robots Looking Increasingly Remote

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The Campaign to Stop Killer Robots warns chances of achieving a U.N. treaty banning the development, production and use of fully autonomous lethal weapons, also known as killer robots, are looking increasingly remote.  Experts from some 80 countries are attending a weeklong meeting to discuss the prospect of negotiating an international treaty. 

Representatives from about 80 countries have been meeting on lethal autonomous weapons systems since 2014.  They have to decide by November to begin negotiations on a new treaty to regulate killer robots. 

Nobel peace laureate Jody Williams says Russia has been in the forefront of a group of countries, including the United States and Australia, trying to block movement in this direction.  At the opening session, she tells VOA that Russia argued for drastically limiting discussions on the need for meaningful human control over lethal autonomous weapons.

“It is very unlikely as they finish up this year that there will be a mandate to meaningfully deal with meaningful human control, which is fundamental in our view to how you deploy such systems,” Williams said. “There would be no utility in continuing to come here and hear the same blah, blah, blah over and over again.” 

Williams said the Campaign to Stop Killer Robots may have to resort to civil activism to get an accord banning killer robots.  She said such tactics successfully achieved international treaties banning land mines and cluster munitions outside the United Nations framework.

But for now, the activists are not giving up on persuading U.N. member countries to take the right course.  They said delegating life-and death decisions to machines crosses what they call a moral red line and should not be allowed to happen.  

They said they have strong support for their stance from U.N. Secretary-General Antonio Guterres. In a statement to delegates attending the meeting, he warned of the dangers of giving machines the power and discretion to take lives without human involvement.

He called this morally repugnant and politically unacceptable.  He said these weapons should be prohibited by international law.

 

 

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Chairman of India’s Ailing Jet Airways Resigns

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The chairman of India’s private Jet Airways has quit amid mounting financial woes which have forced it to suspend 14 international routes and ground more than 80 planes.

A statement by the airline says its board on Monday accepted the resignations of Chairman Naresh Goyal, his wife and a nominee of Gulf carrier Etihad Airways from the board. It said Goyal will also cease to be chairman.

Goyal has been trying to obtain new funding from Etihad Airways, which holds a 24 percent stake in the airline, which was founded 27 years ago.

The statement said the airline will receive 15 billion rupees ($217 million) in immediate funding under a recovery plan formulated by its creditors.

 

 

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EU Fines Nike for Blocking Cross-border Sales of Soccer Merchandise

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U.S. sportswear maker Nike was hit with a 12.5 million euro ($14.14 million) fine on Monday for blocking cross-border sales of soccer merchandise of some of Europe’s best-known clubs, the latest EU sanction against such restrictions.

The European Commission said Nike’s illegal practices occurred between 2004 to 2017 and related to licensed merchandise for FC Barcelona, Manchester United, Juventus, Inter Milan, AS Roma and the French Football Federation.

The European Union case focused on Nike’s role as a licensor for making and distributing licensed merchandise featuring a soccer club’s brands and not its own trademarks.

The sanction came after a two-year investigation triggered by a sector inquiry into e-commerce in the 28-country bloc. The EU wants to boost online trade and economic growth.

European Competition Commissioner Margrethe Vestager said Nike’s actions deprived soccer fans in other countries of the opportunity to buy their clubs’ merchandise such as mugs, bags, bed sheets, stationery and toys.

“Nike prevented many of its licensees from selling these branded products in a different country leading to less choice and higher prices for consumers,” she said in a statement.

Nike’s practices included clauses in contracts prohibiting out-of-territory sales by licensees and threats to end agreements if licensees ignored the clauses. Its fine was cut by 40 percent after it cooperated with the EU enforcer.

($1 = 0.8839 euros)

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Apple Spotlights Services with TV, Gaming and Credit Card Offerings

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Apple attempted to reintroduce itself on Monday as an entertainment and financial services company that also makes iPhones as it launched a streaming television service, a credit card and an online gaming arcade.

The world’s second-most valuable technology company lifted the curtain on a television and movie service called Apple TV+ that will stream original television shows and movies to a television-watching app for users of its 1.4 billion gadgets worldwide, as well as owners of smart TVs and other devices.

But Apple, known in the tech industry for keeping its products secret until they are finished, left out key pricing details for several of its new services, unnerving investors and sending its shares down slightly.

The move could be seen as a first step to challenging streaming video leaders Netflix and Amazon, although Apple is taking a different approach by offering paid “channels” from HBO, Starz and Showtime alongside its own content.

Its revamped app for subscribing to channels from others will come out in May, but Apple’s own original shows will not arrive until autumn, with pricing not yet announced. Apple said both its TV+ shows and the new version of the TV app will be available in more than 100 countries.

Apple also introduced a credit card, a video game arcade, and added hundreds of magazines to its news app at an event at its Cupertino, California, headquarters.

As Apple struggles with saturated markets and sales of its iPhone fall, the company is turning more of its attention to services that provide regular subscription revenue.

Hollywood celebrities helped debut the revamped television offering. Apple has commissioned programming from Jennifer Aniston, Reese Witherspoon, Oprah Winfrey and Steven Spielberg.

Throughout the presentation, Apple executives stressed privacy protections for consumers as they shop and consume content across a range of Apple phones, iPads or other hardware.

They also emphasized content that would appeal to young audiences, potentially setting the stage for a rivalry with Walt Disney Co. Winfrey announced a global book club.

The company, second only to Microsoft in market value among tech giants, led off the event with an announcement that its free news app will now come in a paid-subscription version, called Apple News+, which curates a range of news articles and will include 300 magazines including National Geographic, People, Popular Science, Billboard and the New Yorker. Apple said it would cost $9.99 a month.

Apple also introduced a titanium, laser-etched Apple Card backed by Goldman Sachs Group and Mastercard that can track spending across devices and pay daily cash back on purchases.

Cook also said Apple Pay, its digital wallet, will soon be usable on public transit systems in Portland, Oregon, Chicago and New York City. Apple Pay will be available in more than 40 countries by the end of the year.

Crowded Field

With its new media push, Apple joins a crowded field where rivals such as Amazon.com’s Prime Video and Netflix have spent heavily to capture viewer attention and dollars with award-winning series and films.

The big tech war for viewers ignited a consolidation wave among traditional media companies preparing to join the fray.

Walt Disney Co., which bought 21st Century Fox, and AT&T, which purchased Time Warner Inc, plan to launch or test new streaming video services this year.

Revenue from its “services” segment – which includes the App Store, iCloud and content businesses such as Apple Music – grew 24 percent to $37.1 billion in fiscal 2018. The segment accounted for only about 14 percent of Apple’s overall $265.6 billion in revenue, but investors have pinned their hopes for growth on the segment.

The company also introduced Apple Arcade, a game subscription service that will work on phones, tablets and desktop computers and include games from a range of developers.

Apple said the gaming service will feature more than 100 exclusive titles from gaming partners such as Annapurna Interactive and that the service will arrive this autumn.

But as with its original content service, Apple did not say how much its gaming service will cost consumers. With details about the new services missing, Apple shares fell 1.7 percent on Monday.

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Ethiopian Airlines Chief: ‘Many Questions’ Remain About Boeing Aircraft

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The head of Ethiopian Airlines said “many questions on the B-737 MAX airplane remain without answers” and he pledged “full and transparent cooperation to discover what went wrong.”

“Until we have answers, putting one more life at risk is too much,” CEO Tewolde Gebremariam said Monday in a statement.

“Immediately after the crash and owing to the similarity with the Lion Air Accident, we grounded our fleet of Max 8s. Within days, the plane had been grounded around the world. I fully support this,” Gebremariam said.

A March 10 Ethiopian Airlines crash and Indonesia’s Lion Air crash in October were both Boeing 737 MAX 8 planes. Everyone on board the two flights was killed.

The Ethiopian Airlines flight data recorders revealed that there were “clear similarities” between the two doomed flights.

Gebremariam asserted that his crews were “well trained” on this aircraft.

“We are the the only airline in Africa, among the very few in the world, with the B-737 full flight Simulator,” he said. “Contrary to some media reports, our pilots who fly the new model were trained on all appropriate simulators.”

“In a nation that sometimes is saddled with negative stereotypes, accidents like this affect our sense of pride,” Gebremariam said. “Yet this tragedy won’t define us. We pledge to work with Boeing and our colleagues in all the airlines to make air travel even safer.”

 

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How US States Are Richer Than Some Foreign Nations

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The United States is an economic powerhouse.

As the largest economy in the world, the U.S. produced $20.5 trillion worth of goods and services — known as its Gross Domestic Product (GDP) — in 2018. That’s impressive when you consider that the total GDP for the entire world was about $80 trillion in 2017.

In fact, every U.S. state has a GDP that makes it as powerful, economically, as a foreign nation.

California is the state with the highest GDP in the country. Its $2.97 trillion economy is on par with Britain, which has a GDP of $2.81 trillion. The UK needed 14.5 million workers — 75 percent more than California used — to produce the same economic output. On its own, California is the fifth-largest economy in the world.

The GDP of Texas ($1.78 trillion) is equivalent to the economy of Canada ($1.73 trillion), while New York’s GDP ($1.70 trillion) matches up to South Korea ($1.66 trillion).

Even the smaller U.S. states can hold their own. Wyoming, the smallest U.S. state population-wise, with fewer than 600,000 residents, has a GDP of $41 billion, which is about the same as Jordan’s, a country of 9 million people.

Mark J. Perry, an economics and finance professor at the University of Michigan, and a scholar at the American Enterprise Institute, used data from the U.S. Department of Commerce and the International Monetary Fund for his analysis comparing the GDP’s of U.S. states to entire countries.

He says those numbers are a testament to the “world-class productivity of the American workforce,” and a reminder of “how much wealth, output and prosperity is being created every day in the largest economic engine there has ever been in human history.”

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US Government Posts $234 Billion Deficit in February

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The U.S. federal government posted a $234 billion budget deficit in February, according to data released Friday by the Treasury Department.

Analysts polled by Reuters had expected a $227 billion deficit for the month.

The Treasury said federal spending in February was $401 billion, up 8 percent from the same month in 2018, while receipts were $167 billion, up 7 percent compared to February 2018.

The deficit for the fiscal year to date was $544 billion, compared with $391 billion in the comparable period the year earlier.

When adjusted for calendar effects, the deficit was $547 billion for the fiscal year to date versus $439 billion in the comparable prior period.

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US Official: China’s Race to 5G Raises Global Security Concerns

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Michael R. Wessel is a commissioner of the U.S.-China Economic and Security Review Commission, a U.S. government organization that investigates the national security implications of trade and economic relationship between the U.S. and China.

He recently discussed with VOA his concerns about China’s race to 5G, the next generation of wireless connectivity being built worldwide. With a 5G network, users will be able to send and receive more data in less time, which could have implications for self-driving cars, smart cities and other technologies.  

 

Q: How much does it matter which country is first to fully functioning 5G?

 

Wessel: It does matter. First mover advantage is crucial in any new technology, but it is particularly important in 5G because it is foundational for cutting-edge innovation and applications including smart cities, network manufacturing, and integrated warfighting capability.

When standards are created, controlled, and sold by other countries, there is enhanced pressure on the U.S. to adopt those standards, which would have significant economic and national security costs.

For example, U.S. 4G leadership contributed to around $125 billion in U.S. company revenue from abroad and more than $40 billion in U.S. application and content developer revenue, and created 2.1 million new jobs from 2011-2014. And, from a national security perspective, the “control” of technologies raises unacceptable risks.

Q: How far ahead is Huawei or China on 5G?

 

Wessel: China’s leadership in 5G depends on how we define competition. Some U.S. companies are already offering 5G devices and are running pilot projects in select cities, so they have beat China to the punch. However, Chinese investment into 5G is vast.

 

As of early February 2019, Huawei owned 1,529 “standard-essential” 5G patents, the most of any company, according to data-analytics firm IPlytics. By comparison, Qualcomm, a U.S. company, owned 787 standard-essential patents. All Chinese companies together own 36 percent of all 5G standard-essential patents, while U.S. companies (Intel and Qualcomm) own 14 percent.

 

In terms of 5G network build out, China is also racing ahead: China Tower, a monopoly created by the Chinese government to build the country’s 5G infrastructure, said it would likely cover the country by 2023. One estimate said China Tower built more sites in 3 months than U.S. did in 3 years. In the United States, the process is likely to take much longer, with each company handling its own networks, and will need to negotiate with local governments for tower locations.

Q: The U.S. is urging its allies to not work with Huawei in building their 5G networks out of concern that the Chinese technology giant could give the Chinese government access to the new network for spying. Some countries such as Germany say they won’t rule out working with Huawei. Why is this a problem for the U.S.?

Wessel: We tend to focus on the economic cost and not consider the national security cost of something as significant as a nationwide 5G network rollout.

Huawei products, services and activities have already raised significant concerns and our allies have to consider how much more investment they are willing to make into their technology.  

No amount of risk mitigation or false attempts at transparency are adequate. The problem is Germany and other allies have already incorporated some Huawei equipment into their tech infrastructure. Much like a virus, our allies can choose to inoculate themselves against this danger now, or run the risk of painful and costly treatment later. Unfortunately, this is a great risk to intelligence-sharing among allies and partners.  

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GM Announces Jobs, Electric Vehicle After Trump Criticism

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Less than a week after a series of critical tweets from the president over an Ohio plant closure, General Motors is announcing plans to add 400 jobs and build a new electric vehicle at a factory north of Detroit.

The company says it will spend $300 million at its plant in Orion Township, Michigan, to manufacture a Chevrolet vehicle based on the battery-powered Bolt.

GM wouldn’t say when the new workers will start or when the new vehicle will go on sale, nor would it say if the workers will be new hires or come from a pool of laid-off workers from the planned closings of four U.S. factories by January.

The company also announced plans Friday to spend about another $1.4 billion at U.S. factories with 300 more jobs but did not release a time frame or details.

The moves come after last weekend’s string of venomous tweets by President Donald Trump condemning GM for shutting its small-car factory in Lordstown, Ohio, east of Cleveland. During the weekend, Trump demanded that GM reopen the plant or sell it, criticized the local union leader and expressed frustration with CEO Mary Barra.

GM spokesman Dan Flores would not answer questions about Trump but said the investment has been in the works for weeks. Indeed, GM has said it planned to build more vehicles off the underpinnings of the Bolt, which can go an estimated 238 miles on a single electric charge. The company has promised to introduce 20 new all-electric vehicles globally by 2023.

In November, GM announced plans to shut the four U.S. factories and one in Canada. About 3,300 workers in the U.S. would lose their jobs, as well as 2,600 in Canada. Another 8,000 white-collar workers were targeted for layoff. The company said the moves are necessary to stay financially healthy as GM faces large capital expenditures to shift to electric and autonomous vehicles.

Plants slated for closure include Lordstown; Detroit-Hamtramck, Michigan; Warren, Michigan; White Marsh, Maryland, near Baltimore and Oshawa, Ontario near Toronto. The factories largely make cars or components for them, and cars aren’t selling well these days with a dramatic consumer shift to trucks and SUVs. With the closures, GM is canceling multiple car models due to slumping sales, including the Chevrolet Volt plug-in gas-electric hybrid.

GM has said it can place about 2,700 of the laid-off U.S. workers at other factories, but it’s unclear how many will uproot and take those positions. More than 1,100 have already transferred, and others are retiring.

The United Auto Workers has sued GM over the closings, which still must be negotiated with the union.

Trump’s latest GM tweet on Monday said GM should: “Close a plant in China or Mexico, where you invested so heavily pre-Trump,” and “Bring jobs home!”

Ohio and the area around the Lordstown plant are important to Trump’s 2020 re-election bid. The state helped push him to victory in 2016, and Trump has focused on Lordstown, seldom mentioning the other U.S. factories that GM is slated to close.

Barra has said that she sees no further layoffs or plant closures through the end of 2020.

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