U.S.-Mexico-Canada trade deal will help stave off U.S. recession: U.S. Chamber CEO

By Andrea Shalal and Jonas Ekblom

WASHINGTON (Reuters) – Approval and implementation of the U.S.-Mexico-Canada (USMCA) trade agreement will provide a major boost to the U.S. economy and help stave off a recession, Thomas Donohue, chief executive of the U.S. Chamber of Commerce, said on Thursday.

Donohue, whose organization is spearheading a major campaign to win passage of the trade agreement, said moving ahead with the USMCA would also help pave the way for trade agreements with China, the European Union, Japan and other countries.

“It is a major component in keeping us out of a recession,” Donohue told Reuters after a news conference with other trade associations pushing the U.S. Congress to ratify the replacement for the current North American Free Trade Agreement (NAFTA).

He said the timing was critical given other drags on the U.S. economy, including troubles at top U.S. exporter Boeing Co, which this week reported its biggest-ever quarterly loss due to the spiraling cost of resolving issues with its 737 MAX.

Boeing has reduced production of the grounded jet and suspended deliveries, but on Wednesday warned it might have to shut production completely if it runs into new hurdles with global regulators.

The single-aisle plane was grounded worldwide in March after two fatal crashes in Ethiopia and Indonesia.

“A reduction in our economic growth and our trade is taking place with the Boeing problem,” Donohue said. “They’ll survive this, they’ll move forward.”

House of Representatives Republican Leader Kevin McCarthy on Thursday criticized House Speaker Nancy Pelosi and other House Democrats, who control the chamber, for not bringing the USMCA up for a vote before lawmakers leave for their summer recess.

“What will this do? Only make our country stronger, more prosperous, create more jobs, make the debate with China even in a stronger position for America and make the future better than it is today. But they didn’t do anything about it,” McCarthy told reporters at a news conference.

Donohue and other business leaders cited growing bipartisan support for the USMCA and expressed optimism that the House would move to ratify the agreement in September.

Nearly 600 trade and commerce groups sent a letter urging lawmakers to approve the deal as soon as possible.

“If we don’t move positively on Canada and Mexico, it will be very, very difficult for us to muster the goodwill in other places to get agreements with China, with Japan and the EU,” Donohue told a news conference.

Leaders from the United States, Mexico and Canada signed the agreement in November, but it must be ratified by lawmakers in all three countries.

House Democrats have promised to block the deal until their concerns over environmental, labor and pharmaceutical aspects of the agreement are met, but Donohue and others said they were upbeat those issues could be resolved.

White House officials say the agreement would add about half a percentage point of economic growth to the U.S. economy, creating several hundred thousand jobs and sparking up to $100 billion in new investments in the United States.

U.S. Trade Representative Robert Lighthizer is due to meet with Democratic lawmakers about the agreement again this week, with a focus on enforcement issues.

Industry leaders said moving forward would reduce uncertainty and free businesses to make new investments.

“The thing we hear most about the need to move forward with this agreement is the need to provide certainty,” said Matthew Shay, president of the National Retail Federation.

The group said it would use state fairs and events in local districts in coming weeks to pressure lawmakers to back passage of the deal while campaigning against its opponents.

“We will be activating our grassroots network and targeting key districts,” Donohue said. “You can’t be pro-jobs and anti-USCMA.”

(Additional reporting by Susan Cornwell; editing by Chizu Nomiyama and Jonathan Oatis)

Southwest Airlines extends 737 MAX cancellations through October 1

FILE PHOTO: A number of grounded Southwest Airlines Boeing 737 MAX 8 aircraft are shown parked at Victorville Airport in Victorville, California, U.S., March 26, 2019. REUTERS/Mike Blake/File Photo

(Reuters) – Southwest Airlines Co on Thursday said it was extending the cancellation of Boeing’s 737 MAX planes from its flying schedule until Oct. 1, a day after the Federal Aviation Administration warned it had uncovered a new issue that must be resolved before the plane can be ungrounded.

The airline had previously planned to keep the jet off its flying schedule through Sept. 2. Boeing Co’s MAX fleet has been grounded since March, following a second fatal crash in five months.

Southwest, the world’s largest MAX operator with 34 jets, said the delay will result in removing about 150 flights out of its total peak daily schedule of 4,000.

The FAA on Wednesday said it had identified a new potential risk that Boeing must address on the planes.

Reuters reported on Wednesday that Boeing will not conduct a certification test flight until July 8, under a best-case scenario. The test is a necessary step before Boeing can submit a formal request for approval of a software upgrade for the planes.

Southwest said it “made this decision before any developments of the past few days.”

Once the FAA approves the MAX for flight, Southwest has said it would take about 30 days to get the jets up and running again.

American Airlines said on Thursday it did not “have any schedule announcement to make at this time.” United Airlines on Wednesday said it was extending cancellations into September.

Boeing shares were down 2.5% at $365.48 on Thursday.

(Reporting by David Shepardson in Washington and Ankit Ajmera in Bengaluru; Editing by Saumyadeb Chakrabarty and Bill Berkrot)

Ethiopian Airlines flight crashes, killing 157

Members of the search and rescue mission carry dead bodies at the scene of the Ethiopian Airlines Flight ET 302 plane crash, near the town of Bishoftu, southeast of Addis Ababa, Ethiopia March 10, 2019. REUTERS/Tiksa Negeri

By Duncan Miriri, Maggie Fick and Aaron Maasho

NAIROBI/ADDIS ABABA (Reuters) – An Ethiopian Airlines passenger jet bound for Nairobi crashed minutes after take-off on Sunday, killing all 157 people on board and raising questions about the safety of the Boeing 737 MAX 8, a new model that also crashed in Indonesia in October.

Sunday’s flight left Bole airport in Addis Ababa at 8:38 a.m. (0538 GMT), before losing contact with the control tower just a few minutes later at 8:44 a.m.

A relative reacts as he leaves the information centre following the Ethiopian Airlines Flight ET 302 plane crash, at the Jomo Kenyatta International Airport (JKIA) in Nairobi, Kenya March 10, 2019. REUTERS/Baz Ratner

A relative reacts as he leaves the information centre following the Ethiopian Airlines Flight ET 302 plane crash, at the Jomo Kenyatta International Airport (JKIA) in Nairobi, Kenya March 10, 2019. REUTERS/Baz Ratner

“There are no survivors,” the airline tweeted alongside a picture of Chief Executive Tewolde GebreMariam holding up a piece of debris inside a large crater at the crash site.

“The pilot mentioned that he had difficulties and that he wanted to return,” Tewolde told a news conference.

Passengers from 33 countries were aboard, said Tewolde.

The dead included Kenyan, Ethiopian, American, Canadian, French, Chinese, Egyptian, Swedish, British, Dutch, Indian, Slovakian, Austrian, Swedish, Russian, Moroccan, Spanish, Polish, and Israeli citizens.

At least four worked for the United Nations, the airline said, and the U.N.’s World Food Program director confirmed his organization had lost staff in the accident.

Weeping relatives begged for information at airports in Nairobi and Addis Ababa.

“We’re just waiting for my mum. We’re just hoping she took a different flight or was delayed. She’s not picking up her phone,” said Wendy Otieno, clutching her phone and weeping.

The aircraft, a 737 MAX 8, is the same model that crashed into the Java Sea shortly after take-off from Jakarta on Oct 29, killing all 189 people on board the Lion Air flight.

The cause of that crash is still under investigation.

People walk at the scene of the Ethiopian Airlines Flight ET 302 plane crash, near the town of Bishoftu, southeast of Addis Ababa, Ethiopia March 10, 2019. REUTERS/Tiksa Negeri

People walk at the scene of the Ethiopian Airlines Flight ET 302 plane crash, near the town of Bishoftu, southeast of Addis Ababa, Ethiopia March 10, 2019. REUTERS/Tiksa Negeri

A senior U.S. government official said it was too early to tell if there was any direct connection between the two accidents, but that reviewing the issue would be among the top priorities for investigators.

The 737 is the world’s best selling modern passenger aircraft and is seen as one of the industry’s most reliable.

A preliminary report into the October crash focused on airline maintenance and training and technical questions about the response of a Boeing anti-stall system to a recently replaced sensor.

Boeing is working on a software patch on the system, while insisting cockpit procedures were already in place to deal safely with problems the Lion Air crew experienced.

Ethiopian’s new aircraft had no recorded technical problems and the pilot had an “excellent” flying record, Tewolde said.

“We received the airplane on November 15, 2018. It has flown more than 1,200 hours. It had flown from Johannesburg earlier this morning,” he said.

“UNSTABLE SPEED”

Flight ET 302, registration number ET-AVJ, crashed near the town of Bishoftu, 62 km (38 miles) southeast of the capital Addis Ababa, with 149 passengers and eight crew aboard, the airline said.

The flight had unstable vertical speed after take off, the flight tracking website Flightradar24 tweeted.

Data released by the Sweden-based service suggested the aircraft had climbed almost 1,000 feet after taking off from Addis Ababa, a hot and high-altitude airport whose thinner air requires extra effort from an aircraft’s engines.

It dipped about 450 feet before rapidly climbing another 900 feet until the point where satellite tracking data was lost.

The aircraft had shattered into many pieces and was severely burnt, a Reuters reporter at the scene of the crash said. Clothing and personal effects were scattered widely over the field where the plane came down.

There was no immediate indication of what caused the crash and safety experts said it was too early to speculate, adding most accidents are caused by a cocktail of factors.

They said investigators would examine the wreckage and bodies for any signs of burns or unusual forces and study the shape and size of the wreckage field. An urgent priority will be to find the two crash-protected cockpit recorders – one for data and the other for pilots’ voice recordings.

Boeing said it was sending a technical team to help with the Ethiopian-led investigation.

ANGUISHED RELATIVES

At Nairobi airport, many relatives were left waiting at the gate for hours, with no information from airport authorities. Some learned of the crash from journalists.

Robert Mutanda, 46, was waiting for his brother-in-law, a Canadian citizen.

“No, we haven’t seen anyone from the airline or the airport,” he told Reuters at 1pm, more than three hours after the flight was lost. “Nobody has told us anything, we are just standing here hoping for the best.”

Kenyan officials did not arrive at the airport until 1:30 p.m.

James Macharia, the cabinet secretary for transport, said he heard about the crash via Twitter.

Nineteen staff from at least five U.N. and affiliated organizations died, including the World Food Program, the U.N. refugee agency UNHCR, the International Telecommunications Union, the U.N. Environment Program, the World Bank and the International Organisation on Migration, the IOM said.

ETHIOPIAN AIRLINES

Under international rules, responsibility for leading the crash investigation lies with Ethiopia but the U.S. National Transportation Safety Board (NTSB) will also participate because the plane was designed and built in the United States.

Representatives of Boeing and Cincinnati-based engine-maker CFM International, a joint venture between General Electric and General Electric Co and France’s Safran SA, were expected to advise the NTSB.

Ethiopian is one of the biggest carriers on the continent by fleet size. The plane was among six of 30 Boeing 737 MAX 8 jets the rapidly expanding carrier has ordered.

The fleet will continue flying since the cause of the crash is not clear, the CEO said.

Its last major crash was in January 2010, when a flight from Beirut went down shortly after take-off, killing all 90 people onboard. The Lebanese blamed pilot error, which was disputed by the airline.

North American airlines that operate the 737 MAX 8 said they were monitoring the investigation. Southwest Airlines flies 31 MAX 8 jets while American Airlines and Air Canada each have 24 in their fleet. Southwest said it remained confident in the safety of its more than 750 Boeing jets.

(Additional reporting by Hereward Holland, Omar Mohammed and Katharine Houreld in Nairobi; Tiksa Negeri in Bishoftu; Tim Hepher in Paris, Jamie Freed in Singapore, Allison Lampert in Montreal and David Shephardson in Washington; Writing by Katharine Houreld; Editing by Elaine Hardcastle and Jane Merriman)

Indonesian divers find crashed Lion Air jet’s second black box

FILE PHOTO - Wreckage recovered from Lion Air flight JT610, that crashed into the sea, lies at Tanjung Priok port in Jakarta, Indonesia, October 29, 2018. REUTERS/Willy Kurniawan/File Photo

By Cindy Silviana

JAKARTA (Reuters) – Indonesian authorities on Monday said they will immediately begin to download contents of a cockpit voice recorder (CVR) from a Lion Air jet that crashed into the sea near Jakarta more than two months ago, killing all 189 people on board.

The crash was the world’s first of a Boeing Co 737 MAX jet and the deadliest of 2018, and the recovery of the aircraft’s second black box from the Java Sea north of Jakarta on Monday may provide an account of the last actions of the doomed jet’s pilots.

“We have our own laboratory and personnel to do it,” Haryo Satmiko, deputy chief of the transportation safety committee, told Reuters.

Satmiko said it had in the past taken up to three months to download, analyze and transcribe the contents of recorders.

Contact with flight JT610 was lost 13 minutes after it took off on Oct. 29 from the capital, Jakarta, heading north to the tin-mining town of Pangkal Pinang.

A preliminary report by Indonesia’s transport safety commission focused on airline maintenance and training, as well as the response of a Boeing anti-stall system and a recently replaced sensor, but did not give a cause for the crash.

A group of relatives of victims urged the transportation safety committee to reveal “everything that was recorded” and to work independently.

Navy Lieutenant Colonel Agung Nugroho told Reuters a weak signal from the recorder was detected several days ago and it was found buried deep in soft mud on the seafloor in water about 30 meters (98 ft) deep.

“We don’t know what damage there is but it has obvious scratches on it,” Nugroho said.

Pictures supplied by an official from the transportation agency showed chipped bright orange paint on the CVR memory unit, but no major dents.

Nurcahyo Utomo, an investigator at the safety committee, told reporters it should take no more than five days to download the data, but if there was a problem the CVR would be sent to the manufacturer.

“We hope it can be done as soon as possible because all the Boeing operators are waiting,” said Utomo, adding that investigators hoped to complete the full report within a year of the crash.

With the recovery of the CVR, officials said there was no plan to continue searching for other parts of the wrecked plane, including an angle of attack sensor that was suspected to have been faulty.

The navy’s Nugroho said human remains had been found near the location of the CVR, about 50 meters from where the crashed jet’s other black box, the flight data recorder (FDR), was found three days after the crash.

Investigators brought in a navy ship last week after a 10-day, 38 billion rupiah ($2.70 million), an effort funded by Lion Air failed to find the recorder. Bureaucratic wrangling and funding problems hampered the initial search.

The L3 Technologies Inc CVR was designed to send acoustic pings for 90 days after a crash in water, according to an online brochure from the manufacturer.

That would mean that after Jan. 27, investigators could have faced a far bigger problem in finding the CVR buried along with much of the wreckage deep in mud on the sea floor..

Boeing said in a statement on Monday that it was taking “every measure” to fully support this investigation.

“As the investigation continues, Boeing is working closely with the U.S. National Transportation Safety Board as a technical advisor to support Indonesia’s National Transportation Safety Committee,” the planemaker said in a statement.

Since the crash, Lion Air has faced scrutiny over its maintenance and training standards, and relatives of victims have filed at least three lawsuits against Boeing.

(Additional reporting by Agustinus Beo Da Costa; Writing by Fergus Jensen and Tabita Diela; Editing by Robert Birsel and Darren Schuettler)

Walmart uses lower U.S. tax bill to raise minimum wage to $11 an hour

: A customer pushes a shopping cart at a Walmart store in Chicago, Illinois, U.S. November 23, 2016.

By Nandita Bose

NEW YORK (Reuters) – Walmart Stores Inc said on Thursday it would raise entry-level wages for hourly employees to $11 an hour as it benefits from the biggest overhaul of the U.S. tax code in 30 years.

The world’s largest retailer said the increase would take effect in February and that it would also expand maternity and parental leave benefits and offer a one-time cash bonus, based on length of service, of up to $1,000.

The pay increase and bonus will benefit more than 1 million U.S. hourly workers, it said.

Walmart’s announcement follows companies like AT&T Inc, Wells Fargo Co and Boeing Co, which have all promised more pay for workers after the Republican-controlled U.S. Congress passed a tax bill last month that cut the corporate tax rate to 21 percent from 35 percent.

A Walmart employee helps a customer navigate a flyer at the store in Broomfield, Colorado November 28, 2014.

FILE PHOTO: A Walmart employee helps a customer navigate a flyer at the store in Broomfield, Colorado November 28, 2014. REUTERS/Rick Wilking/File Photo

President Donald Trump and his fellow Republicans have argued that the big corporate tax cut will benefit workers and lead to more investment by U.S. companies.

“We are in the early stages of assessing the opportunities tax reform creates for us,” President and Chief Executive Officer Doug McMillon said in a statement. The tax law gives the retailer an opportunity to be more competitive globally and to accelerate investment plans for the United States, he said.

The increase in wages will cost approximately $300 million on top of wage hike plans that had been included in next fiscal year’s plans, the company said.

The company is offering a one-time bonus to all full and part-time employees based on their length of service, rising to $1000 for employees with 20 years of service. The one-time bonus will amount to $400 million in the current fiscal year.

The company raised its minimum wage to $9 an hour in 2015. In 2016, it said employees who finished an internal training program would be eligible for $10 an hour. The retailer has spent about $2.7 billion to increase wages over the past few years.

(Reporting by Nandita Bose; Editing by Lisa Von Ahn and Frances Kerry)

Unmanned U.S. Air Force space plane lands after secret, two-year mission

The U.S. Airforce's X-37B Orbital Test Vehicle mission 4 after landing at NASA's Kennedy Space Center Shuttle Landing Facility in Cape Canaveral, Florida, U.S.,

By Irene Klotz

CAPE CANAVERAL, Fla. (Reuters) – The U.S. military’s experimental X-37B space plane landed on Sunday at NASA’s Kennedy Space Center in Florida, completing a classified mission that lasted nearly two years, the Air Force said.

The unmanned X-37B, which resembles a miniature space shuttle, touched down at 7:47 a.m. EDT (1147 GMT) on a runway formerly used for landings of the now-mothballed space shuttles, the Air Force said in an email.

The Boeing-built space plane blasted off in May 2015 from nearby Cape Canaveral Air Force Station aboard an Atlas 5 rocket built by United Launch Alliance, a partnership between Lockheed Martin and Boeing.

The X-37B, one of two in the Air Force fleet, conducted unspecified experiments for more than 700 days while in orbit. It was the fourth and lengthiest mission so far for the secretive program, managed by the Air Force Rapid Capabilities Office.

The orbiters “perform risk reduction, experimentation and concept-of-operations development for reusable space vehicle technologies,” the Air Force has said without providing details. The cost of the program is also classified.

Personnel in self-contained atmospheric protective ensemble suits conduct initial checks on the X-37B Orbital Test Vehicle 1.

Personnel in self-contained atmospheric protective ensemble suits conduct initial checks on the X-37B Orbital Test Vehicle 1. REUTERS/U.S. Air Force/Michael Stonecypher

The Secure World Foundation, a nonprofit group promoting the peaceful exploration of space, says the secrecy surrounding the X-37B suggests the presence of intelligence-related hardware being tested or evaluated aboard the craft.

The vehicles are 29 feet (9 meters) long and have a wingspan of 15 feet, making them about one quarter of the size of the National Aeronautics and Space Administration’s now-retired space shuttles.

The X-37B, also known as Orbital Test Vehicle, or OTV, first flew in April 2010 and returned after eight months. A second mission launched in March 2011 and lasted 15 months, while a third took flight in December 2012 and returned after 22 months.

Sunday’s landing was the X-37B’s first in Florida. The three previous landings took place at Vandenberg Air Force Base in California. The Air Force relocated the program in 2014, taking over two of NASA’s former shuttle-processing hangars.

The Air Force intends to launch the fifth X-37B mission from Cape Canaveral Air Force Station, located just south of the Kennedy Space Center, later this year.

(Reporting by Irene Klotz; Editing by Phil Berlowitz)

Boeing CEO sees ‘near term’ plane deal after Trump meeting

Dennis Muilenburg, CEO of The Boeing Company, arrives at Trump Tower in New York City, U.S. January 17, 2017.

By Alwyn Scott and Doina Chiacu

(Reuters) – Boeing Co’s chief executive said on Tuesday that he and President-elect Donald Trump “made progress” on lowering the cost of the Air Force One presidential aircraft fleet and on a potential sale of Boeing fighter aircraft, and suggesting a deal could be struck soon.

Boeing CEO Dennis Muilenburg’s visit to Trump Tower on Tuesday marked another step in Trump’s efforts to use his bully pulpit to cut better deals with defense contractors. It also showed Boeing’s adroit use of the meetings to pursue its own sales and herald its importance to the U.S. manufacturing economy.

Trump has been pressuring defense companies on prices through Twitter posts and meetings. Last month he said a $4 billion contract for Air Force One was too expensive and should be canceled. Boeing has said it so far has a $170 million contract for design work on the heavily modified Boeing 747 planes and that no final figure for the fleet of planes had been established.

Trump also last month asked the Chicago-based aerospace and defense company to price a contract for Boeing’s F/A-18 Super Hornet fighter jet to compete with Lockheed Martin’s F-35 fighter, which is famously over budget.

While not offering details, Muilenburg said the “excellent conversation” with Trump could lead to a deal “in the very near term.”

“We made some great progress on simplifying requirements for Air Force One, streamlining the process, streamlining certification by using commercial practices,” Muilenburg told reporters after the hour-long meeting. “That’s going to lead to substantial cost reductions.”

On fighter jets, he said, “we were able to talk about options for the country and capabilities that will, again, provide the best capability for our war fighters most affordably.”

Muilenburg praised Trump’s approach to negotiations.

“I think Mr. Trump is doing a great job of engaging business,” he said, noting that as the U.S.’ top exporter, Boeing supports 1.5 million U.S. manufacturing jobs and 13,000 small and mid-sized supplier companies.

“If you want manufacturing jobs, aerospace is the place to invest,” he said. “We’re proud to take on that mission and I think Mr Trump’s engagement with industry is going to help us grow manufacturing jobs in this country.”

“I appreciate the teamwork approach on this – I think it’s the right way to do business.”

Boeing’s stock was down 0.6 percent at $157.87 in afternoon trade.

(Reporting by Alwyn Scott in Seattle and Doina Chiacu in Washington; Editing by Meredith Mazzilli and Marguerita Choy)