Business & Finance
American Airlines appeared to have staved off bankruptcy, announcing last-minute tentative agreements with its pilots', mechanics', and flight attendants' unions on $1.8 billion in pay and benefits give-backs. The deals still require the approval of rank-and-file members of all three unions, however - a ratification process that was expected to begin immediately. American, the world's largest carrier, has lost almost $5.3 billion over the past two years.Skip to next paragraph
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In other key airline industry developments:
• US Airways received a $900 million loan guarantee from the federal Air Transportation Stabilization Board. In exchange, the ATSB will be given a 10 percent equity stake in the company. The seventh-largest US carrier emerged from bankruptcy reorganization Monday.
• Transportation Department regulators dropped their objections to a plan by Delta, Northwest, and Continental to sell seats on each other's flights. But the agency said it would monitor the new system closely to ensure that it doesn't limit competition.
General Motors announced interest-free financing for up to five years on almost all new vehicles and cash rebates up to $3,000 on many models. The incentives are the latest in a series as the world's leading automaker, and its main rivals, try to boost sluggish sales.
HealthSouth Corp. fired chief executive Richard Scrushy and said it was replacing auditor Ernst & Young amid an accounting scandal. Meanwhile, another HealthSouth executive, the third to date, pleaded guilty to fraud as a federal inquiry continued into allegations that the rehabilitation-center operator had inflated profits by $1.4 billion since 1999.
Reliant Resources Inc., the troubled Houston energy services provider, said it reached agreement with lenders on a $6.2 billion financing package, averting possible default on a $2.9 billion debt payment.
Semiconductor rivals Advanced Micro Devices Inc. and Fujitsu Ltd. agreed to combine their flash-memory operations. The joint venture is to be based in Sunnyvale, Calif., and is projected to begin operations this summer with 7,000 employees. Flash memory, which is used in such devices as cellphones and digital cameras, has been one of the few growth areas for the chip industry in the past year.