France, Feb 14 (AP/UNB) — European aviation giant Airbus said Thursday it will stop making its superjumbo A380 in 2021 for lack of customers, abandoning the world's biggest passenger jet and one of the aviation industry's most ambitious and most troubled endeavors.
Barely a decade after the 500-plus-seat plane started carrying passengers, Airbus said in a statement that key client Emirates is cutting back its orders for the plane, and as a result, "we have no substantial A380 backlog and hence no basis to sustain production."
The decision could hurt up to 3,500 jobs and already cost the plane maker 463 million euros in losses in 2018, Airbus said.
The end of the young yet iconic jet is a boon for rival Boeing and an embarrassing blow for Airbus, a European economic powerhouse. A pall of mourning hung in the atmosphere Thursday at its headquarters in the southern French city of Toulouse.
It's also sad news for Emirates, which had the A380 as the backbone of its fleet, based out of Dubai, the world's busiest airport for international travel.
Still, Airbus announced Thursday a 29-percent jump in overall profits last year, and analysts said global demand is high enough for Airbus to weather the loss of its iconic superjumbo.
The plane maker reported net profit of 3.1 billion euros over last year, up from 2.4 billion euros in 2017. In addition to the A380 loss, Airbus reported a charge of 436 million euros on the A400M, used by several European militaries.
Airbus said it forecasts similar profits in 2019, in line with growth in the world economy and air traffic.
Emirates announced Thursday that it had struck a deal valued at $21.4 billion with Airbus to replace some A380s with A350 wide-bodies and smaller A330 planes.
"While we are disappointed to have to give up our order, and sad that the program could not be sustained, we accept that this is the reality of the situation," Sheikh Ahmed bin Saeed Al Maktoum, the chairman and CEO of Emirates, said in a statement. "For us, the A380 is a wonderful aircraft loved by our customers and our crew. It is a differentiator for Emirates. We have shown how people can truly fly better on the A380."
Emirates long has been the largest operator of the A380. Before Thursday's announcement, it had 162 of the jumbo jets on order.
The A380 has been a favorite of Emirates' passengers, especially those in business and first class, which encompassed the entire upper deck of the airplane and was complete with a bar in the back.
Airbus had hoped the A380 would squeeze out Boeing's 747 and revolutionize air travel as more people take to the skies.
Instead, airlines have been cautious about committing to the costly plane, so huge that airports had to build new runways and modify terminals to accommodate it. The double-decker planes started flying in 2008 and seated more than 500 passengers.
The A380 had troubles from the start, including tensions between Airbus' French and German management and protracted production delays and cost overruns. Those prompted a company restructuring that cost thousands of jobs.
Industry experts initially expected A380s to long outlast the 747, which is celebrating its 50th birthday this year.
When it started taking on passengers in 2008, the A380 was hailed for its roominess, large windows, high ceilings and quieter engines. Some carriers put in showers, lounges, duty free shops and bars on both decks.
Beijing, Feb 13 (AP/UNB) — U.S. and Chinese negotiators are meeting this week for their final trade talks before President Donald Trump decides whether to escalate a dispute over technology with a March 2 tariff hike on $200 billion of imports from China.
The two days of talks starting Thursday allow too little time to resolve the tariff war over Beijing's technology ambitions that threatens to drag on weakening global economic growth, businesspeople and economists say. They believe China's goal is to make enough progress to persuade Trump to extend his deadline.
There are few signs of movement on their thorniest issue: Washington's demand that Beijing scale back plans for government-led creation of global champions in robotics and other technology. China's trading partners say those violate its market-opening obligations and some in America worry they might erode U.S. industrial leadership.
This week, Beijing wants "to see the threat of additional tariff imposition being removed for as long as possible," with minimal conditions attached, said Louis Kuijs of Oxford Economics.
Trump's December agreement to postpone more tariff hikes while the two sides negotiate expires March 1. The following day, a 10 percent tariff imposed in July on $200 billion of Chinese imports would rise to 25 percent.
Companies on both sides have been battered by Washington's tariffs and retaliatory duties imposed by Beijing. The stakes are rising as global economic growth cools.
Trump hiked tariffs on Chinese goods in July over complaints Beijing steals or pressures companies to hand over technology. The dispute spread to include Chinese technology plans, cyberspying and the countries' lopsided trade balance.
Chinese leaders have offered to narrow their multibillion-dollar trade surplus with the United States. But they have balked at making major changes in development plans they see as a path to prosperity and more global influence.
"China will continue resisting U.S. demands in certain areas, such as changes to its industrial strategy and the role of the state in its economy," said Eswar Prasad, a Cornell University economist who was head of the China division at the International Monetary Fund.
Chinese officials reject complaints that foreign companies are required to hand over technology. But business groups and foreign governments point to rules they say compel companies to share technology with state-owned local partners or disclose trade secrets.
Chinese officials also are balking at U.S. pressure to accept a mechanism to monitor whether Beijing carries out its promises, said Kuijs.
"They feel that it is humiliating for China if another country does this," he said.
The U.S. delegation is led by Trade Representative Robert Lighthizer, who has said his priority is Chinese industrial policy, not the trade gap. He is accompanied by Treasury Secretary Steven Mnuchin.
The Chinese side by Vice Premier Liu He, President Xi Jinping's top economic adviser. It will be his second meeting with Lighthizer following last month's talks in Washington.
Business groups and economists say the decision by the top trade envoys to participate suggests the talks might be making enough progress to require higher-level political decisions.
Their deputies have met since Monday to make preparations. On the American side, that includes Jeffrey Gerrish, a deputy trade representative, and David Malpass, a Treasury undersecretary who is Trump's nominee for World Bank president.
Even if negotiators produce an agreement, it run might into opposition from within the Trump administration, said Prasad.
"The hardliners seem loath to settle for a deal that represents anything less than total capitulation by China on all U.S. demands," he said.
Beijing has tried to deflect pressure by emphasizing China's growth as an export market. It has announced a series of changes over the past year to open finance and other fields, including allowing full foreign ownership in its auto industry for the first time.
Regulators have announced plans to improve protection of foreign patents and copyrights. But it is unclear whether that will satisfy Washington and other governments that complain the system is designed to extract technology from foreign companies and to use official industrial standards to shield Chinese enterprises from competition.
"There's been notably less progress" around such issues, said Jeremie Waterman, president of the U.S. Chamber of Commerce's China Center and a former U.S. trade official.
Negotiators have said any final agreement will have to be made by Trump and his Chinese counterpart, Xi Jinping. Trump said last week they plan to meet, but not before the March 1 deadline.
"When the time is right, the hope would be that the personal chemistry that exists (between Trump and Xi) will pay dividends," said Erin Ennis, senior vice president at the U.S.-China Business Council.
The Hong Kong newspaper The South China Morning Post reported Monday that the meeting could take place in late March on the southern Chinese island of Hainan.
Other possible sites include Beijing or Trump's Mar-a-Lago estate in Florida, where the two met in April 2017, the U.S. news website Axios reported, citing Trump administration officials.
And what if Trump goes ahead with a March 2 tariff hike to step up pressure on Beijing?
"We certainly hope not," said Waterman. "It would be a terrible cost for American consumers and a terrible hit to the global economy."
Geneva, Feb 13 (AP/UNB) — Forty countries led by Japan and the European Union — but not the U.S. or China — have agreed to require new cars and light commercial vehicles to be equipped with automated braking systems starting as soon as next year, a U.N. agency said Tuesday.
The regulation will require all vehicles sold to come equipped with the technology by which sensors monitor how close a pedestrian or object might be. The system can trigger the brakes automatically if a collision is deemed imminent and if the driver doesn't appear set to respond in time.
The measure will apply to vehicles at "low speeds": 60 kilometers per hour (42 mph) or less, and only affects new cars sold in the markets of signatory countries — so vehicle owners won't be required to retrofit their cars and trucks already on the roads today.
The United States, China and India are members of the U.N. forum that adopted the new regulations. However, they did not take part in the negotiations because they want to ensure that their national regulations keep precedence over U.N. rules when it comes to the auto industry.
In 2016, 20 automakers reached an agreement with the U.S. government to put automatic emergency braking on all new vehicles by September of 2022, but compliance is voluntary. In the most recent report on the safety technology from 2017, the National Highway Traffic Safety Administration said that four of the 20 automakers — Tesla, Mercedes-Benz, Toyota and Volvo — had made automatic braking standard on more than half their models.
Data from the insurance industry's Highway Loss Data Institute show that 28 percent of 2019 U.S. models have standard automatic emergency braking. Another 36 percent have it as an option.
Jason Levine, executive director of the nonprofit Center for Auto Safety, said lack of U.S. participation in the U.N. group is embarrassing for a country that once led in auto safety.
"It is yet another indication of the auto industry in the United States and the Trump administration's complete lack of leadership when it comes to the safety of everyone on the road," Levine said Tuesday.
A message was left Tuesday seeking comment from NHTSA, the U.S. highway safety agency.
The requirement will start taking effect next year first in Japan, where 4 million cars and light commercial vehicles were sold in 2018, said Jean Rodriguez, the spokesman for the agency, called United Nations Economic Commission for Europe, or UNECE. The European Union, and some of its closest neighbors, is expected to follow suit in 2022.
UNECE says the countries that agreed to the deal want to be more pro-active in fighting roadway accidents, particularly in urban settings where obstacles like pedestrians, scooters, bicycles and other cars in close proximity abound. The agency pointed to more than 9,500 roadway deaths in the EU in 2016, and EU Commission estimates that the braking systems could help save over 1,000 lives a year in the bloc.
Apparently wary that the regulations might be seen as a step toward giving artificial intelligence precedence over humans, the drafters put in clear language in their resolution: A driver can take control and override these automated braking systems at any time, such as through "a steering action or an accelerator kick-down."
UNECE says the new rules build on existing U.N. rules on the braking system for trucks and buses, mainly for safety in higher-speed motorway conditions.
Beijing, Feb 12 (AP/UNB) — Asian stocks rose Tuesday following a listless day on Wall Street as investors looked ahead to U.S.-Chinese trade talks.
KEEPING SCORE: Tokyo's Nikkei 225 rose 2 percent to 20,745.28 and the Shanghai Composite Exchange added 0.3 percent to 2,661.89. Hong Kong's Hang Seng was 1.5 points higher at 28,122.41 and Seoul's Kospi gained 0.3 percent to 2,188.32. Sydney's S&P-ASX 200 advanced 0.2 percent to 6,073.60 and New Zealand, Taiwan and Malaysia also rose. Manila and Jakarta declined.
WALL STREET: Gains for industrial companies, banks and energy stocks outweighed losses elsewhere. Small-company stocks fared better as investors shifted focus away from the tail end of a strong corporate earnings season to U.S.-Chinese trade talks. The Dow Jones Industrial Average fell 0.2 percent to 25,053.11. The Standard & Poor's 500 index rose 0.1 percent to 2,709.80. The Nasdaq composite added 0.1 percent to 7,307.90.
U.S.-CHINA TALKS: Treasury Secretary Stephen Mnuchin leads a delegation to Beijing on Thursday for talks aimed at resolving a tariff war over American complaints about Chinese technology ambitions. The dispute threatens to chill global economic growth. The talks are the last scheduled high-level meeting before an agreement by both sides to suspend further punitive action against each other's goods expires March 1.
U.S. GOVERNMENT SHUTDOWN: Traders were watching negotiations in Washington aimed at averting another government shutdown. Democrats and the GOP disagree over how much to spend on President Donald Trump's promised border wall. A Friday midnight deadline is looming to prevent a second partial government shutdown.
ANALYST'S TAKE: "U.S. equities struggled to establish clear direction as concerns about progress of trade talk and U.S. government shutdown looms in the background," said Zhu Huani of Mizuho Bank in a report. "Investor sentiment remains cautious despite report suggesting that President Trump's advisers are discussing a potential summit with his Chinese counterpart Xi Jinping next month."
GLOBAL ECONOMY: Fears of a global slowdown were given additional fuel from a report showing Britain's economy had its slowest economic growth since the aftermath of the global financial crisis. Both Europe overall and China are contending with slower growth.
ENERGY: Benchmark U.S. crude gained 40 cents to $52.81 per barrel in electronic trading on the New York Mercantile Exchange. The contract lost 31 cents on Monday to close at $52.41. Brent crude, used to price international oils, rose 49 cents in London to $62.00. It shed 59 cents the previous session to $61.51.
CURRENCY: The dollar gained to 110.47 yen from Monday's 110.36 yen. The euro edged up to $1.1283 from $1.1279.
Taipei, Feb 10 (AP/UNB) — A strike among pilots at Taiwan's flag carrier China Airlines dragged into a third day Sunday, resulting in further flight cancellations.
There was no immediate word of a settlement as the pilots' union remained firm in its demands for an additional backup pilot on flights lasting eight hours or more, a more transparent system of promotion, a year-end bonus and other concessions.
The official Central News Agency said a total of 47 flights will have been canceled by Sunday.
The strike came in the middle of the Lunar New Year travel rush. About 70 percent of the carrier's 1,300 pilots belong to the union, which has accused management of insincerity and mistreating its workforce to keep costs down.
CAL crews went on strike for 24 hours in 2016 for better conditions.
The airline has said it is willing to continue negotiations but that the union's demands in talks are different from those it makes in public.
Flights canceled included those bound for Hong Kong, Bangkok, Los Angeles, Manila and Tokyo. Most of those were departing from Taiwan's main international airport at Taoyuan, just south of the capital Taipei.
Founded in 1959, China Airlines is one of the island's two largest carriers with a fleet of 88 aircraft.