More good news for Boeing (BA) CEO Harry Stonecipher. A month after winning a key defense contract, Boeing got some unexpected lift from its commercial airplane unit. On July 7, it announced the first European customers for its new, fuel-sipping 7e7 jetliner. Two charter carriers -- Blue Panorama of Italy and First Choice Airways of Britain -- ordered a total of 10 of the 230-passenger jets, worth about $1.2 billion. That boosts the tally to 62 new 7e7 orders since Boeing launched the program in December.
Since taking the controls at Boeing in December after his predecessor resigned in the wake of an ethics scandal, Stonecipher has been working overtime. His goal: to get the nation's No. 2 defense contractor out of the penalty box. And he's getting results: The U.S. Navy in June awarded Boeing a $3.9 billion development contract to build a submarine-hunting airplane. If the Navy takes all 109 modified 737s as planned, it will mean $15 billion in sales. Stonecipher's turnaround of Boeing is clearly gaining altitude.
After a month of stalled car sales, General Motors (GM) and Ford Motor (F) are hoping that new incentives will lure buyers back. GM, whose sales fell 15.5% in June, is offering a $5,000 rebate on most trucks and $4,000 on cars. Ford is playing a similar card, hoping to reverse its 8% June sales slide with 0% financing deals on many models. This is sure to keep margins thin. In June, auto makers were already offering big deals to car buyers. GM led the industry with an average incentive of $4,091 per vehicle, says Merrill Lynch (MER). Ford was second, with incentives averaging $3,679. Those are sweet deals, considering that the average incentive in June for all carmakers was just under $3,000 a vehicle.
Bradley Blum won't be having it his way at Burger King anymore. The former Olive Garden (DRI) executive handed in his resignation as CEO on July 2, citing "strategic differences" with the company's board. His departure -- the ninth Burger King chief to exit in the last 15 years -- complicates efforts of the ailing burger chain's new owners, led by buyout firm Texas Pacific Group, to fix its Whopper-sized problems. While same-store sales ticked up 7.2% in May, total U.S. sales have declined for five years in a row, and seven Burger King franchisees controlling more than 600 restaurants have filed for bankruptcy in the last two years. Soggy sales and shrinking franchises mean Wendy's International (WEN) could soon supplant Burger King as the nation's second-largest hamburger chain, behind McDonald's (MCD).
The stress of fending off a hostile takeover by rival Oracle (ORCL) may finally be taking a toll on PeopleSoft (PSFT). The Pleasanton (Calif.) maker of business software on July 7 said second-quarter sales were between $655 million and $665 million, with a net profit in the range of $10 million to $18 million. Both fell short of Wall Street's expectations. PeopleSoft blamed customer hesitance in the face of Oracle's takeover bid. The fight moved into high gear in June when the Justice Dept. argued in federal court that Oracle's bid should be blocked on antitrust grounds. A decision is expected in a month.
It's not quite Subscribergate, but the Securities & Exchange Commission has sent letters to the nation's cable, telephone, and now satellite companies. The SEC wants to determine if the companies are accurately reporting numbers of subscribers, a key measure of performance. Satellite operators DirecTV (DTV) and EchoStar (DISH) Communications have received letters, joining more than 20 companies, including cable giant Charter Communications (CHTR) and phone companies AT&T (T), BellSouth (BLS), and Cingular Wireless. All said they would cooperate with the inquiry. The letters come after Verizon Communications (VZ) acknowledged that it overstated the number of its long-distance customers.
-- The government did not renew a contract with defense contractor Titan (TTN).
-- The FTC began a formal probe of a Shell (RD) refinery closing in California.
-- The SEC began probing mutual-fund payments to retirement plans.
IseBay (EBAY) nodding off? After rising 48% this year, its shares fell 6% from a June 28 high to $86.87 on July 7. Some of the decline came after Prudential Equity Group (PRU) cut its rating to "neutral." The Web marketplace's typically slow summer is unlikely to ignite the stock, Pru says.