American Airlines: Going for Great or Going for Racial Insensitivity?; Congress Lets Banks Off the Hook. For Now; Things Aren’t Looking Sunny at Tesla Lately

Something racially insensitive in the air…

ID-100303427

Image courtesy of khunaspix/FreeDigitalPhotos.net

Some say there’s no such thing as bad publicity but I’m skeptical about that. Take for example American Airlines. The NAACP just issued an advisory cautioning African Americans about traveling on American Airlines because the organization found an alarming pattern of “disturbing incidents” by the airline where black passengers were removed from flights. And the NAACP might just be onto something since it listed four distinct incidents where African American passengers were either taken off flights or moved to other sections of the aircraft despite holding tickets for higher class cabins. The NAACP said that the incidents “suggest a corporate culture of racial insensitivity” which I am pretty certain counts as bad publicity no matter how you slice it. Of course, American Airlines is “disappointed” about the advisory, and not just because it looks sooooooo bad. However, it still plans to reach out to the NAACP and invite representatives to its corporate offices in Texas to discuss the situation. Of course, just like with any bad publicity, American Airlines shares are down over 2%. Rightfully so, I suppose.

Don’t bank on it…

ID-100206984

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

You might not remember when, during President Obama’s presidency, a regulation was passed that allowed consumers to file class-action suits against banks.  But Congress remembered and today duly killed the regulation from the Consumer Financial Protection Bureau that was established back in July. Just. Like. That.  The rule went like so: If a consumer was unhappy with a financial product or service, think of Wells Fargo or Equifax, and wanted action and accountability from the institution, the said financial institutions could not force a consumer into mandatory arbitration. And if a consumer wanted to participate in a class-action lawsuit, they could. Financial institutions had to nix clauses in their contracts that effectively forced consumers into arbitration. Before that rule came about, consumers could not sue. Could. Not. Sue. There was no option to settle lawsuits. Dems are hopping mad because they wanted that rule to stay put arguing that it allowed consumers to hold banks and financial institutions accountable and that arbitration always seemed to go more in favor of the banks. Republicans argued that class-action suits do not benefit the consumers anyway and have the potential to greatly harm businesses that ultimately and adversely affect the economy. Consumers are no better off, they argued, whether they go through arbitration or are part of a class-action lawsuit. Republicans even cited information from a Treasury report supporting those claims.  Of course, the recent scandals at Wells Fargo and Equifax didn’t exactly help the Republicans argument. Yet miraculously, Congress still managed to put the kibosh on the rule. Consumer advocates are all over this and insist that the war is not over. Except that a key battle was just lost.

Rolling heads…

ID-100300187

Image courtesy of Ppiboon/FreeDigitalPhotos.net

While the ranks at Tesla continue to get smaller by the hundreds following an ugly recall of 11,000 Model X SUV’s, employees at Tesla-owned SolarCity are starting to smell the stench of unemployment too.  Over 200 employees were dismissed from their jobs at SolarCity with the dismissed being told that they lost their jobs for performance reasons, or lack thereof. However,  that proved to be an awfully strange excuse considering that several of the aforementioned employees said they hadn’t even received performance reviews since Tesla acquired SolarCity last November for $2.6 billion. Things that make you go hmmm.Tesla did announce it would be firing employees from SolarCity’s Roseville, California office. And it did. Except the carnage didn’t stop there. Apparently, SolarCity employees all over the country were also fired.  As for the Roseville office, some say the office will stay open with 50 employees while others insist that the whole office is being shut down.  In any case, I’m guessing the holidays are going to be awkward this year for Elon Musk and his family since SolarCity was founded by his cousins Lyndon and Peter Rive back in 2006. Critics of Musk’s plan to buy the solar company felt that it would distract the CEO from making great cars.  Maybe. Maybe not. But one thing is for sure: A lot of people are wondering how much longer it is going to be until Elon Musk finally rolls out the super-hyped but affordable Model 3.

 

Advertisements