Automakers reported a 3.4 percent increase in vehicle sales in May from the same month in 2003, as gas prices did not appear to dampen demand for pickups and sport-utility vehicles. General Motors said sales were up 6.8 percent, with truck sales soaring 11.4 percent. Ford saw sales of its Ford, Lincoln and Mercury brands rise 1 percent, with car sales falling 0.5 percent and truck sales up 1.7 percent. Chrysler Group reported that sales were 5.2 percent higher, with car sales down 2.9 percent and truck sales up 7.8 percent. The 10 Asian manufacturers that compete in the United States sold 567,266 vehicles, a 9.9 percent rise from a year earlier, led by a 24 percent increase for Nissan.
Ex-Adelphia Chief Limits Defense
Adelphia Communications founder John J. Rigas and his son Michael rested their defense after just two days, declining to rebut the 16 prosecution witnesses presented at their three-month-old fraud trial. John Rigas, 79, skipped the trial yesterday for a checkup of his cancerous bladder at the Mayo Clinic. John Rigas, his sons Michael and Timothy, and a fourth executive, Michael C. Mulcahey, are accused of hiding $2.3 billion in debt, stealing $100 million and lying about revenue and operations at the cable-television company. Mulcahey, 46, began testifying after Michael Rigas, 50, a former vice president of operations, declined to take the witness stand.
Kraft Foods abandoned its plan to limit portions of single-serve packages after its consumer research found that some shoppers prefer larger sizes. The food processor said that it plans to offer a broad range of portion-size choices.
Ford Motor must pay $122 million to a California woman paralyzed in an Explorer rollover accident, a San Diego jury ruled. The verdict is the first loss for Ford after 13 favorable verdicts at trial in Explorer rollover cases. The victim said the SUV was unstable and prone to rolling over during common evasive driving maneuvers, and its roof was too weak to protect her.
Viacom is losing another top executive. A day after its president and chief operating officer stepped down, the media conglomerate announced the departure of Jonathan Dolgan, chairman of the Viacom Entertainment Group, which oversees Paramount Pictures, Paramount TV and Simon & Schuster, the company said in a statement. On Tuesday, Mel Karmazin, Viacom Inc.'s No. 2 executive, resigned suddenly and was replaced by two senior Viacom executives, CBS head Leslie Moonves and MTV chief Tom Freston.
Top executives expect the U.S. economy to grow stronger the next six months with gains in employment, capital spending and sales, the Business Roundtable said. The 38 percent of the 116 chief executives who plan to add staff was the highest percentage since the business advocacy group began its quarterly survey in November 2002.
HealthSouth's former chief financial officer apologized before a federal judge sentenced him to house arrest and probation for his role in a $3.4 billion financial fraud. "I'll go forward. I'll bear the scarlet letter. It won't be an 'A,' it will be an 'F,' for fraud," said Malcolm McVay, who cooperated with the government in its investigation of the scheme.
United Airlines wants to make permanent reductions in retiree medical benefits over the objections of the beneficiaries. United has said it needs to make benefit cuts to facilitate its exit from bankruptcy court protection this year. The airline has already agreed with its mechanics union to cut retiree medical benefits. It now wants to impose benefit cuts on 27,000 other retirees, including former pilots and flight attendants. A trial on the issue is scheduled to begin June 11.
Verizon cut the price of digital subscriber line Internet access for businesses to $59.95 to $79.95 a month, a reduction of as much as 33 percent, as part of a strategy to win customers from cable operators. The company also tripled the speed at which users can send pictures and other information over the Internet.
General Motors continues to strengthen its finances and product lineup, but the world's largest automaker is not as profitable as it needs to be, chairman and chief executive G. Richard Wagoner Jr. told shareholders. The company said that pricing pressure, health care costs and unfair trade practices are hurting it and that it hopes a restructuring and new products will improve its finances. Also, GM's board was reelected, and all seven shareholder-presented proposals were voted down.
The Securities and Exchange Commission said mutual funds should be aware of potential conflicts of interest on the part of proxy-voting companies that provide advice on how to vote at annual meetings. The SEC said mutual funds must know who the advisers' clients are and how much they are being paid because some of the firms that offer advice also work as consultants to publicly held companies.
Bernard Ebbers's lead lawyer asked a federal judge to delay the former WorldCom chief executive's scheduled November fraud trial until at least January because of timing issues created by a separate case. Reid H. Weingarten also represents Mark A. Belnick, a former top lawyer for Tyco International, who is on trial in New York state court on charges of securities fraud and grand larceny.
Payless ShoeSource has recalled two types of pre-walk and toddler-size athletic shoes because the metal eyelet lace holder can come off and pose a choking hazard to young children. The chain sold the shoes from December 2003 through April under the names Smart Fit or Teeny Toes. A five-digit number -- 31056, 31057, 31219, 32264, 32265, 33060 or 33061 -- is written on the underside of each shoe's tongue.
Nortel Networks said its financial records are so complex that it can't say when it will complete a restatement for 2003 and prior periods. The Canadian telephone equipment manufacturer provided its first update on the accounting review since April 28, when it fired chief executive Frank A. Dunn and two top deputies. Nortel won't report audited second-quarter results until the restatement is finished, said William Owens, who succeeded Dunn.
The Federal Agricultural Mortgage Corp. needs stronger capital standards and other tougher regulation because of the risks in its investments, a General Accounting Office official said. Stricter regulation "is especially important given Farmer Mac's increasing risk portfolio" and its holdings of "non-mission-related assets," Davi D'Agostino, GAO's financial markets and community investment director, told the House Agriculture Committee. Farmer Mac executives said the company is doing what Congress intended and is "operating safely and soundly." Congress is considering creation of a stronger regulator for government-sponsored enterprises, which include Farmer Mac as well as the much larger mortgage finance companies Fannie Mae and Freddie Mac.
Albertson's fiscal first-quarter earnings fell 79 percent, to $36 million, as a Southern California labor dispute reduced sales and income for the grocery and drug chain. Revenue for the three months ended April 29 declined 2.5 percent, to $8.69 billion.
Neiman Marcus Group reported a 67 percent increase in fiscal third-quarter earnings, to $68.8 million, as the upscale department store chain registered its biggest sales gain in almost eight years and continued to control costs. Revenue for the three months ended May 1 rose 21 percent, to $877.6 million.
Compiled from reports by the Associated Press, Bloomberg News, Dow Jones News Service and Washington Post staff writers.