Headlines

The global airline industry on Monday nearly doubled its forecast for losses this year to $9 billion, amid what it said were the worst conditions it has ever faced, The New York Times reported. The International Air Transport Association said it now expected revenues across the industry to fall 15 percent to $448 billion this year and its new loss forecast was nearly twice the $4.7 billion it had projected in March. “There is no modern precedent for today’s economic meltdown. The ground has shifted.

Labour talks between Air Canada and the Canadian Auto Workers have broken off until early next week after the parties hit an impasse over management's request for a moratorium on its pension payments this year, The Calgary Herald reported on a Financial Post story. "It's not the only sticking point, but it's the key sticking point," said Leslie Dias, CAW Local 2002 president. The CAW represents 4,500 sales and service agents at the airline and its current contract is set to expire on Sunday. But Ms. Dias said the talks will continue next week.

The federal government has appointed the judge who oversaw Air Canada's insolvency filing six years ago to mediate the latest pension dispute between the company and its unionized employees, The Canadian Press reported. Finance Minister Jim Flaherty, acting on his own initiative, asked James Farley to devise a sustainable path for the airline's pension plan that is acceptable to Air Canada, its unions and its retiree association. Farley, currently in private practice for McCarthy Tetrault, presided over Air Canada's bankruptcy restructuring that began in April 2003 and lasted 18 months.

Arcandor AG, the German owner of the Karstadt department-store chain, applied for €437 million ($620 million) in public rescue aid from the state-owned development bank KfW Group to avoid insolvency, Bloomberg reported. The loan from KfW would last for six months, according to a subsequent statement from the Essen-based retailer. Arcandor needs to refinance €650 million ($924 million) of loans by June 12 to avoid insolvency.

Privately-owned German alumina products manufacturer Almatis and its lenders have begun debt restructuring talks, three sources close to the talks said on Thursday. The group, which is headquartered in Frankfurt, has meanwhile secured a waiver on requirements to provide audited accounts for this year, the sources added. Almatis was acquired by Dubai International Capital (DIC) in 2007, backed by a $970 million loan arranged by UBS and Arab Banking Corporation, according to Thomson Reuters LPC data.

Italian automaker Fiat SpA is still interested in Germany's Opel despite losing a bid to take over the General Motors Corp unit, Chief Executive Sergio Marchionne said on Friday, Reuters reported. Fiat lost out last week to Canadian car parts maker Magna International Inc in a bid for Opel, but Marchionne's comments suggested Fiat might yet be a factor in the deal. "The deal technically is not closed, we will see," Marchionne said, adding that Fiat had not yet used a €1 billion ($1.42 billion) line of credit from banks.

General Motors Corp. sold more cars in Britain than anywhere else in Europe last year. But it was Germany, and not Britain, that agreed to rescue GM’s European Opel unit with bridge loans last week to ease a sale to Magna International Inc. Prime Minister Gordon Brown hasn’t committed money to a bailout, raising concern U.K. employees will be cut after the deal as more Germans are spared. Opel sold almost 350,000 vehicles in the U.K. last year under the Vauxhall brand, the No. 2 seller in the market behind Ford Motor Co.

The biggest hurdle to the sale of General Motors Corp.'s Hummer brand to a little-known Chinese manufacturer of dump trucks and industrial machinery may be receiving Beijing's seal of approval, The Wall Street Journal reported. But before it can buy Hummer, Tengzhong Heavy Industrial Machinery Co., based in Sichuan province, needs support from three different Chinese government agencies governing overseas investment, economic planning and China's tight controls on foreign exchange.

Publicis Groupe, the French owner of advertising agency networks including Saatchi & Saatchi, has estimated that it will take a €55 million (£49 million) hit due to its client General Motors filing for bankruptcy, The Guardian reported. Publicis, which is the world's fourth largest advertising company, said late yesterday that it has asked the GM bankruptcy court to grant it "essential vendor" status, which allows for advertising work and payments to continue while the stricken car manufacturer goes through its Chapter 11 restructuring.

Russian President Dmitry Medvedev, opening the St Petersburg International Economic Forum, said on Friday the global economy had avoided the worst but warned participants it was too early to celebrate recovery, Reuters reported. The global financial crisis has hit Russia harder than any other big emerging market but Medvedev said in generally sober remarks that the country had stabilized its financial system and followed appropriate policies.