The daily business briefing: February 8, 2017
The Army moves to grant final Dakota Access Pipeline permit, trade deficit narrows as exports rise, and more
Army to grant easement to complete Dakota Access Pipeline
The Army said in a Tuesday court filing that it would grant the final permit necessary to complete the Dakota Access Pipeline. The move would reverse a decision by the Obama administration to have the Army Corps of Engineers study alternative routes for the final stretch of the pipeline, which passes near the Standing Rock Sioux Reservation in North Dakota, under a tribal water source. The tribe and its supporters have been protesting the construction for months, saying it threatens the tribe's water supply and sacred Native American sites. The Seattle City Council on Tuesday voted to stop using Wells Fargo for financial services because it is an investor in the pipeline.
Trade deficit drops as U.S. exports rise
The U.S. trade deficit dropped in December, causing the trade gap to drop by 3.2 percent to $44.3 billion, the Commerce Department reported Tuesday. Exports rose to their highest level in more than 18 months as shipments of American technology products hit record levels. The Commerce Department also reported that last year's trade deficit was the largest since 2012. The news came as President Trump vows to reverse the loss of U.S. factory jobs with sweeping changes to U.S. trade policy, starting with his decision to scrap the Trans-Pacific Partnership, a 12-nation free trade deal.
VW launches subsidiary to handle electric car push
Volkswagen said Tuesday that it had launched a subsidiary called Electrify America to manage the $2 billion it is required to spend on zero-emission and electric vehicles as part of the settlement over its diesel-emissions scandal. VW said the new company would use the money on research, as well as construction and maintenance of infrastructure, such as charging stations. The spending on zero-emission vehicles is part of a $14.7 billion settlement with U.S. regulators over the company's use of software installed in hundreds of thousands of diesel vehicles to cheat on emissions tests.
German central bank leader rejects U.S. currency-deflation allegation
German central bank chief Jens Weidmann on Tuesday rejected a Trump administration allegation that Germany was helping its companies by keeping currency values low. Germany is the leading economy of the euro zone, and no longer has its own currency that it directly controls, but Trump trade council head Peter Navarro said the euro was "grossly undervalued" and functioned as an "implicit deutsche mark." Weidmann said that German exporters are doing well "because they are well positioned in world markets and convince people with innovative products."
GM profits beat expectations but quarterly earnings fall
General Motors reported Tuesday that its fourth quarter earnings and profit margins declined, although its profits beat Wall Street's expectations. The U.S. automaker's quarterly profits in North America fell by 5.5 percent, and its operating margin fell to 8.4 percent from 10 percent in the same period of 2015. GM's stock dropped by 4.7 percent on the news. GM CFO Chuck Stevens said the company would have "another strong year," although with the U.S. market expected to get tougher, that could mean production cuts to avoid having to offer big discounts on models that sell slowly.