Business Digest: U.S. industrial production jumps in March


ECONOMY

U.S. industrial production jumps in March

WASHINGTON — U.S. industrial production posted a solid gain in March, reflecting a record rebound in utility output. But a closely watched gauge of manufacturing posted its first setback in seven months as auto production dropped sharply.

The Federal Reserve said Tuesday that industrial production rose 0.5 percent, propelled by an 8.6 percent surge in utility output, the largest on records dating to 1939. The utility gain reflected a return to normal demand for heating in March after an unusually warm February had cut demand.

Manufacturing output fell 0.4 percent last month, the first decline since August. The manufacturing decline was led by a 3 percent drop in the production of motor vehicles and parts.

Output in the mining sector was up a slight 0.1 percent after a 2.9 percent February gain.

Industrial production, which covers manufacturing, utilities and mining, had produced a scant 0.1 percent increase in February. Output in February was held back by the sharp drop in utility production.

AUTOMAKERS

VW profit jumps on new vehicles, cost controls

FRANKFURT, Germany — German automaker Volkswagen has reported better-than-expected earnings for the first quarter thanks to cost controls and a stronger contribution from its core brand, which was boosted by new models including the Tiguan SUV.

The company said Tuesday that it made 4.4 billion euros ($4.7 billion) in operating earnings in the January-March period, up from 3.4 billion euros a year earlier. The figure excludes financial items such as interest and taxes.

The company said e that the namesake brand contributed 0.9 billion euros. The statement credited success in holding down fixed costs as well as the successful launch of new vehicles including the Tiguan.

Volkswagen’s sales have risen despite a scandal over cars rigged to cheat on diesel emissions tests. It passed Toyota last year to become the world sales leader with 10.3 million vehicles sold.

The company pleaded guilty to criminal charges in the United States and faces investor lawsuits in Germany. It has set aside more than 18 billion euros ($19 billion) to cover the costs of the scandal. Those include settlements with environmental authorities as well as the costs of fixing or buying back cars with software that enabled the cheating.

RECALLS

Subaru isues recall for engine stalling problem

DETROIT — Subaru is recalling more than 33,000 compact cars in the U.S. because a fuel problem can make the engines can stall without warning.

The recall covers Impreza cars from the 2017 model year.

Subaru says in documents filed with the government that a winter blend of fuel can turn to vapor in the fuel line, causing the engine to run rough and stall. Drivers may not be able to immediately restart the cars, increasing the risk of a crash.

The company began investigating in January after getting several reports of stalling. No crashes or injuries have been reported.

Dealers will update the engine control software so the engine cooling fan comes on at a lower temperature. The company has not yet posted a date for the recall to begin.

FOOD INDUSTRY

Fruity Pebbles owner Post Holdings to buy Weetabix

Post Holdings, the company behind Fruity Pebbles, Honey Bunches of Oats and other cereals, said Tuesday that it is buying the maker of British breakfast brand Weetabix as it seeks to expand overseas.

It is paying 1.4 billion pounds, or about $1.8 billion, to buy Weetabix from its owners, Shanghai-based Bright Food Group and Baring Private Equity Asia.

St. Louis-based Post Holdings Inc. said that the deal will allow it to grow its U.S. brands internationally and expand Weetabix in North America.

The deal is expected to close by September.



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