Qantas Airways to cut 1,500 Jobs Worldwide

Qantas Airways Ltd., Australia's flagship carrier, said Friday it will slash 1,500 jobs worldwide and abandon plans to create 1,200 more as it tries to deal with skyrocketing fuel costs.

Chief executive Geoff Dixon said the cuts represent 4 percent of the airline's total work force and include closing call centers in Tucson, Arizona and London, causing the loss of 99 jobs. About 1,300 jobs will be lost in Australia and the rest overseas.

Qantas is also scrapping plans to increase its capacity by 8 percent in the 12 months to mid-2009, with no growth now expected in that period, Dixon said. Also, 22 older planes in Qantas' 228-strong fleet will be retired.

Qantas' budget subsidiary Jetstar will also be hit by the cuts, with its hiring program suspended, including pilots. A Jetstar cabin crew and pilot base in the southern city of Adelaide will be shut by September.

"The jobs to be cut will be principally concentrated in non-operational areas, although operational positions will also go," Dixon told reporters. "Over 20 per cent of our management and head office support jobs will be cut."

Dixon said the cuts were necessary to ensure that Qantas survives what he described as a crisis in the aviation industry caused by big rises in the price of fuel. Other major airlines have announced job and capacity cuts while raising fares and fees to offset higher spending on fuel.

Fuel accounts for about 35 percent of Qantas' expenses, and rising fuel costs are expected to add more than $1.95 billion to the company's fuel bills to the year ending mid-2009.

The first step in the job shedding plan would be to ask for voluntary redundancies, Dixon said.

Asian Stocks Tumble on US Financial woes

Asian stock markets fell sharply Tuesday as investor confidence in the U.S. financial system eroded even further despite a government-backed plan to help beleaguered mortgage financiers Fannie May and Freddie Mac.

Every major index suffered declines, with Hong Kong's Hang Seng Index dropping more than 4 percent and Taiwan's benchmark losing over 4.5 percent.

In Tokyo, the Nikkei 225 index dropped nearly 2 percent to close at 12,754.56.

While losses spread across most sectors, banks were hit particularly hard as investors worried that trouble in the U.S. financial markets would spillover to Asia. Japanese traders, for instance, were rattled by a local business newspaper report that the country's top three banks hold a combined 4.7 trillion yen ($44 billion) in Fannie May and Freddie Mac debt.

Those two government-chartered companies received a boost Sunday when the U.S. central bank and Treasury Department promised to step in with short-term funding and other aid should mortgage losses mount. Together, the companies hold or back about half the outstanding mortgages in the United States.

A sell-off of regional banks overnight on Wall Street, as well as fears that other American banks might face difficulties ahead, only added to the unease. On Monday, the Dow Jones industrial average fell 45.35, or 0.41 percent, to 11,055.19 after spiking nearly 140 points in early trading.

"Investors are quite concerned we could be heading toward a meltdown in the equities market if there's no rebuilding in confidence, especially in the U.S.," said Alex Tang, head of research at Core Pacific-Yamaichi in Hong Kong.

In Japan, banking giant Mizuho Financial Group Inc.'s shares dipped 3.5 percent in afternoon trade and Mitsubishi UFJ Financial Group Inc. was down nearly 4 percent.

Meanwhile, China's biggest lender, ICBC, dropped almost 5.2 percent in Hong Kong trading. China Construction Bank was off 5.4 percent.

China's most-watched index in Shanghai was off 3.4 percent. Elsewhere, South Korea's benchmark slid 3.2 percent, India's Sensex lost 3.7 percent and Australia's main index slipped 2.1 percent.

In currency trading, the dollar declined against the yen to 105.59. The greenback was flat against the euro.

Coca-Cola Agrees to $137.5 mln Settlement in Case

Coca-Cola Co., agreed to pay $137.5 million to settle a shareholder lawsuit that claimed the world's largest soft drink maker artificially inflated sales to boost its stock price, according to court documents.

The lawsuit, filed in October 2000, claimed that in 1999 Coca-Cola had forced some bottlers to purchase hundreds of millions of dollars of unnecessary beverage concentrate in an effort to make its sales seem higher.

Bottlers use the beverage concentrate to make soft drinks.

Institutional investors, led by Carpenters Health & Welface Fund of Philadelphia & Vicinity, said the practice, known as "channel stuffing," artificially inflated Coca-Cola's results and gave investors a false picture of the company's health.

The investors claimed that Coca-Cola had failed to disclose material facts about its business and these omissions and misrepresentations harmed investors.

Without admitting any wrongdoing, Coca-Cola agreed to the settlement on June 26, according to court documents obtained by Reuters. The settlement was filed with the court on July 3.

Coca-Cola had previously denied any wrongdoing or liability, but agreed to settle the case to avoid lengthy and uncertain litigation, the settlement said.

The settlement applies to anyone who acquired Coca-Cola common stock from Oct 21, 1999 through March 6, 2000, according to the settlement agreement, which was filed with the U.S. District Court for the Northern District of Georgia.

In 2005, Coca-Cola settled a similar issue over the sale of excess beverage concentrate to bottlers in Japan between 1997 and 1999.

"Coca-Cola misled investors by failing to disclose end-of-period practices that impacted the company's likely future operating results," the U.S. Securities and Exchange Commission said at the time.

Coca-Cola admitted no wrongdoing and paid no fines in that settlement pact, but agreed to cease and desist from future securities violations and maintain tight internal controls on sales to bottlers and customers. The U.S. Department of Justice had closed an investigation without filing charges against the company.

Siemens Reportedly to cut 17,200 Jobs

Mostly white-collar and administrative positions being let go

Conglomerate Siemens AG, wracked by a wide-ranging corruption scandal, will cut up to 4 percent of its work force worldwide, or about 17,200 jobs, a pair of newspapers reported Saturday.

The Sueddeutsche Zeitung reported that the Munich-based company was set to shed the jobs — mostly white-collar and administrative — without citing any sources. The Wall Street Journal also reported a similar figure, citing a person who was familiar with the matter.

Siemens did not comment on either report, only to say that it did not comment on market rumors.

The German paper said that of the cuts to the company's global work force of approximately 435,000 staffers, some 6,400 could come in Germany, where it employs around 136,000 people.

Both papers said the company cited the rough economic conditions worldwide as one reason for the cuts, but Siemens CEO Peter Loescher warned earlier this year that the company faced a bumpy road.

In March, Siemens issued a profit warning saying that weaker-than-expected performance in its major business projects this quarter was going to pull earnings down by approximately $1.41 billion.

The warning was a surprise for the conglomerate, whose diverse products include trams, turbines and telecommunications equipment, given that it had said in January that sales were expected to double the pace of the global economy.

It had a second-quarter profit of $648.82 million in the January-March period, down 67 percent compared with a year earlier.

In February, Siemens said it would reorganize its corporate telecom unit as it prepares to get out of the business, eliminating 3,800 jobs while another 3,000 will be transferred to partners or other units — its biggest cuts in years.

The new figures reported Saturday were on top of the previously disclosed cuts.

Shares of Siemens were down 0.17 percent to close at $111.64 in Frankfurt trading Friday.