At The Motley Fool, we know our readers like to be informed. We have scouted out today's most relevant news items and bring them to you all on one page. We hope you find this midday edition informative and useful.
GM seals the deal
General Motors (NYSE: GM ) has signed a four-year deal with the United Auto Workers that will increase the company's labor costs by only 1% annually and protect its strong balance sheet. The company said added expenses will amount to $175 million this year and $20 million in each of the following two years, to total $215 million. The company spent $5 billion on hourly labor in 2010.
The contract calls for GM to create 6,400 jobs at American plants, move some work to the U.S. from Mexico, and increase entry-level pay. The 48,500 GM workers covered by the contract will receive a $5,000 bonus this year and a $1,000 bonus every year starting in 2013. The deal will offer a retirement incentive of $75,000 for skilled-trade workers and of $10,000 for all others. The bonuses and the increase in pay will cost about $585 million through 2013, but the amount will be offset by saving $340 million with the elimination of free legal services for workers. Read more at The New York Times.
Kindle Fire turns up the heat
Companies may be pressured to slash prices on their tablet computers after Amazon (Nasdaq: AMZN ) introduced its Kindle Fire at the low price of $199. Companies from Samsung to Sony (NYSE: SNE ) have tried to go up against Apple's (Nasdaq: AAPL ) iPad, with little or no success, and most competitors' prices are closely priced to the iPad. These tablets, including Motorola's Xoom, run on Google's Android software. So does the Kindle Fire. But it is the combination of the software and Amazon's online store that gives the Kindle Fire an edge. But the new product lacks some of the basics of other tablets, from cameras to a 3G connection. Read more at Reuters.
Ford on a roll
Ford (NYSE: F ) announced that it would be adding 7,000 new jobs in the U.S. in the next two years. CEO Alan Mulally gave the announcement as Ford continues talks with the United Auto Workers for a new collective bargaining agreement. The company did not give details because terms of the contract are still being negotiated.
Mulally made the announcement during the unveiling of a new Ford pickup truck plant in Bangkok. He said the company will focus on growth in Thailand and will continue to expand in Asia despite signs of a slowdown in demand in China and India. Ford has invested $450 million in a new plant in Thailand's Rayong province with the capacity to build 150,000 units a year. Read more at The Wall Street Journal.
Nokia to cut jobs
Nokia (NYSE: NOK ) announced it will cut 3,500 jobs, shut down a mobile-phone plant in Romania, and inject -- along with Siemens (NYSE: SI ) -- a total of $1.4 billion into their unprofitable network-equipment venture. The closure of the plant, which began operation in 2008, along with adjustments with suppliers will take out 2,200 positions, the company said. Nokia will also reorganize its map business, cut 1,300 jobs, and review the future of its handset plants in Finland, Hungary, and Mexico.
The reductions come on top of 4,000 job cuts announced in April in the research and development area. The company is slimming down as it's lost considerable market share to Apple and companies like HTC, which have been able to bring the price of smartphones below $100. Read more at Bloomberg Businessweek.
So there you have it, the top financial stories for this afternoon. If you are interested in getting all the news and commentary on these stocks, sign up to My Watchlist here; it's free!
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