Fiat Gets Going with Google; April Showers Bring Great Car Sales; Building-A-Profitable-Bear

Behind the wheel…

ID-100323966

Image courtesy of atibodyphoto/FreeDigitalPhotos.net

It might just have been a bit of good luck that car company Fiat gets to team up with Google to engineer some self-driving cars. The company will supply Google with 100 Chrysler Pacifica hybrid minivans and it will mark the first time that Google shares its inside information with outside entities. If you’re thinking of saving up to buy one, don’t bother. They won’t be for sale. Besides, they’re minivans. Google has dealt with other car companies, like Toyota, except Google did the work on the cares rather than working together with Toyota. This collaboration is a sweet deal for Fiat, which has a lot of catching up to do in the way of technological advancements in their vehicles. Besides, the company is kind of low on cash and wouldn’t have had enough of it to make a meaningful investment towards tech upgrades. But with this new collaboration in the works, it doesn’t have to worry about raising money for that. How very convenient.

New car smell…

ID-100166798

Image courtesy of atibodyphoto/FreeDigitalPhotos.net

Speaking of Fiat, global sales of the company sank around 2%, keeping up with the rest of the grim state of the global economy. But all was not lost as sales in the U.S. picked up 5%, selling 200,000 cars and trucks while dealing a minor blow to analysts’ estimates of a paltry 4.6% increase. Sales of Jeep also scored big compared to the same time last year as it increased 17%. But that’s minor compared to sales of Compass and Renegade automobiles which more than doubled. Sales of automobile in the U.S. in April were so good that it just might be coming off of the best April. Ever. Car sales are considered a fairly accurate barometer of consumer spending and last months’ numbers indicate that the economy, the U.S. economy, that is, is looking good and healthy. Individual sales of cars throughout the industry was up 3%, with a lot of help from SUV and pick-up truck sales. Unfortunately I did not contribute to any sales growth. The volume of cars sold told a very different and unpleasant story by dropping 3.5%. Some companies have also lopped off major chunks from their incentive programs seeing as how they tend to eat the bottom line. Not that this should come as any great shock but VW was down 9.7% as it continues its brutal journey back from its emissions scandal. Some analysts thinks the car industry is about to hit a peak. But apparently it’s just a cyclical issue and nothing that should cause you to lose sleep. Unless of course you’re in the business of selling cars.

Bear market…

ID-100226881

Image courtesy of atibodyphoto/FreeDigitalPhotos.net

Build-A-Bear just released its earnings – yes, it is a publicly traded company – and the results didn’t exactly leave investors feeling…warm and fuzzy. Ya dig? The DIY stuffed animal biz that boasts some 400 stores picked up $3.53 million in profit, adding 22 cents per share. Too bad the company missed expectations of 37 cents per share and didn’t perform nearly as well as last year at this time when the company scored a profit of $6.82 million with 40 cents per share added. Revenue was up 1.7% to $95 million for the quarter compared to last year, but again, the workshops missed estimates of $96.6 million, fuzzy ears and all. To be fair, however, it will probably still get a fourth straight year of profitability, even if the numbers don’t wow investors. In the fiscal blame game, the company pointed the finger at some expenses tied to store remodeling, international expansion and the ever-pesky high tax rate. The board announced that it hired advisers to come up with “a full range of strategic alternatives.” Which is basically code for trying to figure out a bunch of ways to make more money. Investor J. Carlo Cannell, who happens to own an 8% stake in the company, feels that the board is the real problem and called them and their actions “financially unsophisticated, lacking in proper corporate governance and shareholder unfriendly.” Don’t hold back now, J. Carlo.

Walmart’s Court-ing Big Problems; What’s in a Name? Ask Chrysler, If You Can Still Call It That; Stuyvesant High Schooler Fails in Lying;

 Hitting a Wal…mart…

Image courtesy of nirots/FreeDigitalPhotos.net

Image courtesy of nirots/FreeDigitalPhotos.net

Walmart’s lawyers have been especially busy this year. But not to Walmart’s advantage, it would seem. The retailer just got word that a Pennsylvania supreme court upheld a lower court’s ruling from 2007 that it has to pay over $150 million to approximately 187,000 employees who sued the the company in a class action suit. According to the lawsuit, Walmart stiffed employees by not compensating them for rest/meal breaks, or actually making them work through those breaks and then not paying the unrested, hungry employees for that time. Of course, Walmart is considering appealing the ruling, whose amount is sure to put a major dent in its quarterly earnings. I’m guessing you’re not as choked about that as Walmart execs are. Then there was last weeks’ decision by a National Labor Relations Board administrative law judge who found that the US’s largest employer also threatened employees in California because they tried to organize. Back to today, the lawyers and family of John Crawford, who was shot inside a Beavercreek, Ohio Walmart , named the corporation in a lawsuit. The lawsuit alleges that Walmart did not provide a “reasonable place to shop” because a bb gun involved in the shooting was left unpackaged in the store for two days.

What’s your name again?

Image courtesy of olovedog/FreeDigitalPhotos.net

Image courtesy of olovedog/FreeDigitalPhotos.net

Chrysler Group LLC it isn’t. Well, it was. Up until Tuesday morning when the automobile manufacturer announced it was changing its name  to “FCA US LLC.” Got that? Neither did I. But apparently this name fits in better, globally, anyway, with its parent company Fiat Chrysler Automobile NV. But it’s okay if you forget and call a Chrysler a Chrysler, because those cars will still be made and be called Chryslers, along with Jeeps, Dodge and Fiats, who are all also keeping their names. The company – and name – which originated in 1925, with some vision and assistance from the very industrious Walter P. Chrysler, employs 77,000 people all over the world and has 36 manufacturing facilities, with 23 in the United States alone.

He lied! He lied!

Image courtesy of africa/FreeDigitalPhotos.net

Image courtesy of africa/FreeDigitalPhotos.net

Looks like Mohammed “Mo” Islam is not such a whiz kid after all. After a story appeared in New York magazine about a 17 year old Stuyvesant High Schooler who was rumored to have pocketed $72 million in the stock market, it turns out none of it was true.  The story was picked up by just about everybody, including this blog, and the young man and a friend were even scheduled to do an interview on CNBC to discuss their non-existent success.  However, New York Observer’s Ken Kurson, and a team of media and legal professionals uncovered the hoax, after noticing how so many many people questioned the story, which first picked up steam inside the hallowed halls of Stuyvesant High. Apparently the only trades Mohammed ever made were simulated ones and his fortune is more akin to the fake kind you might find in a board game. New York magazine did issue an official apology, but it seems that it’s the wrath and disappointment of Mohammed’s parents who will make Mohammed come to rue his dubious actions. According to Mohammed, his dad, “wanted to disown me. My mom basically said she’d never talk to me.” And who can blame them.

 

Southwest Goes Global (Almost), Chrysler Goes Up and Hormel Goes For More Protein

Going (more) places…

Image courtesy of ping phuket/FreeDigitalPhotos.net

Image courtesy of ping phuket/FreeDigitalPhotos.net

Southwest is headed even more south…and west. The airline made its first flights today to Jamaica, the Bahamas and Aruba, as part of its new venture to go international. Plans for flights to Mexico and the Dominican Republic are also in the works. This was all part of the plan when the airline bought AirTran back in 2011 to expand and take over its routes. Southwest has been struggling to compete with other airlines like JetBlue. Its traffic grew a very miniscule 1.4% this year. Even though Southwest is the largest carrier of passengers within the United States, it’s but a blip compared to its fellow carriers who soar high above international waters. If you’re looking to book your next trip across the pond with Southwest, you’re going to have to wait a while…a really long while as Europe, Asia and South America have yet to become amongst its destinations.

Increasing-ly popular…

Image courtesy of sattva/FreeDigitalPhotos.net

Image courtesy of sattva/FreeDigitalPhotos.net

Chrysler is having better luck (and sales) than GM these days (but then again, who isn’t?). The third largest US automaker just came out with earnings and reported a 9% increase in sales. In fact, it was the auto company’s best June since 2007, which is a mighty feat considering the company had filed for chapter 11 back in 2009. The company, which is a subsidiary of Fiat, saw a particularly nice 28% sales increase from its Jeep brand and an even nicer 113% sales increase from its Fiat 500L. Unfortunately, Chrysler’s own brand dropped 12%. But at least it’s not experiencing issues like GM, who once again, announced yet another recall of 8 million vehicles and barely broke even in its earnings.

Rich in protein…

Image courtesy of lamnee/FreeDigitalPhotos.net

Image courtesy of lamnee/FreeDigitalPhotos.net

Nothing says hip, cool protein like Spam and milk. That’s just what you were thinking, right? With a winning combo like that it’s no wonder Hormel Foods (HRL) just plunked down $450 million to buy CytoSport, maker of the very muscular Muscle Milk. Hormel, which in addition to its Spam line also makes foods like chili and Skippy Peanut Butter, feels it wants to attract a younger demographic that’s like totally into its protein consumption and well…Spam just wasn’t doing the trick. Apparently, the younger generation wants their protein through a straw. With Muscle Milk, Hormel will have a cool hip brand that younger people can totally dig. Wall Street will dig the purchase as well since CytoSports, which also makes powders and bars, is expected to pull in a very wholesome and hearty $370 million.

Hey Big Spenders, You Auto know and Why’d You Leggo of Your Eggo?

Score one for the consumers…

Image courtesy of anankkml/FreeDigitalPhotos.net

Image courtesy of anankkml/FreeDigitalPhotos.net

People have been shopping lately – a lot – as evidenced by a big jump in consumer spending for March. In fact it was the most spent money in five years. People bought cars, furniture and lots of other merchandise. Household purchases account for 70% of the economy and consumers helped to stimulate the economy with a .9% increase. Go consumers! That’s especially good news since the release of that dismal report showing the economy only grew by a teeny tiny .1%. But alas, jobless claims were up for the third straight week when 344,000 filed people filed unemployment claims. That number was up by 14,000.

Vroom vroom vroom…

Image courtesy of sattva/FreeDigitalPhotos.net

Image courtesy of sattva/FreeDigitalPhotos.net

The auto industry has been bombarding Wall Street with its earnings today. Ford missed the mark with sales that were down by .8%. Analysts predicted it would have a 3.1% gain. Chrysler was up 14% over the same period last year but missed their estimates by 2%. However, they probably weren’t terribly distraught since its Jeep brand had its best monthly sales ever. Ever. But the biggest head scratcher was scandal-wracked GM. It was up 7% despite the fact that its recent recall debacle just about destroyed its quarterly profits. According to CEO Mary Barra, the recall debacle had “no meaningful impact on sales.” Coincidentally, GM is helping to put together “the first shipping container homestead.” It’s exactly what it sounds like. The project will be made primarily from scraps from one of its plants. One company’s scraps is another man’s shipping container homestead.

Snap crackle drop…

Image courtesy of Serge Bertasius Photography/FreeDigitalPhotos.net

Image courtesy of Serge Bertasius Photography/FreeDigitalPhotos.net

Apparently you don’t gotta have your Pops. Kellogg’s, the maker of such iconic products as Eggo Waffles, Pop Tarts and Apple Jacks (my personal favorite) is watching its revenue crumble this quarter by 3%. It pulled in $3.74 billion when Wall Street was hoping it would pull in $3.81 billion. Increased competition, particularly from allegedly healthier alternatives (think Greek yogurt and breakfast sandwiches) has caused first quarter revenues to go soggy. Then there’s that whole McDonalds/Taco Bell breakfast war where the two fast-food chains want you to forego breakfast at home entirely. But Kellogg refuses to refuses to go down without a food fight and is rolling out…are your ready for this? A drinkable cereal. BOOM! Then it plans to further tackle those pesky healthy obstacles showcasing the finer nutritional points of a bowl of cereal swimming in milk. However, I suspect they wont be using Fruit Loops for that campaign.