GM settles hundreds of ignition switch lawsuits
NEW YORK General Motors Co has agreed to settle federal lawsuits by as many as 203 plaintiffs over defective ignition switches in its vehicles, a Friday court filing shows.
FRANKFURT German utility RWE (RWEG.DE) may cut more jobs than planned and sell assets to bring down costs as it battles sluggish demand for energy in a struggling European economy, its chief executive said.
"We will have to make do with fewer workers in the future," German daily Die Welt cited Peter Terium as saying in an interview published on Saturday.
His comments come two days after RWE announced plans to halve its 2013 dividend to 1 euro per share, sending the company's stock lower.
Separately, Essen-based RWE is mulling to sell unprofitable coal power stations to financial investors to cut debt, magazine Wirtschaftswoche reported on Saturday, citing a company insider.
A spokesman for the company couldn't immediately be reached for comment.
Terium told Die Welt that investors should consider whether it still makes sense to pay out high dividends as long as the company is laden with 33 billion euros ($45 billion) in debt and its power generation business is suffering.
"Dividends have to be earned and financed sustainably. If the company is doing its part through de-investments, spending cuts and lower costs, and if employees shoulder a major part of the burden, then the capital market has to contribute, too."
Terium told Die Welt he could not yet say how many jobs would go in the end.
That will depend on how much headcount can be cut via early retirements, how quickly new businesses such as energy services take off and how many jobs it moves to nearby lower-cost countries.
Earlier this week, industry sources said RWE planned to axe 3,000 jobs and freeze pay for three years as part of an efficiency drive dubbed "Neo".
Along with peers E.ON (EONGn.DE) and EnBW (EBKG.DE), RWE has come under intense pressure from falling wholesale power prices in Europe, its core market.
In addition, the strong expansion of renewables has hurt the profitability of gas plants, as power from solar and wind sources takes priority in being fed into the electricity grid, reducing the hours gas plants can run. ($1 = 0.7402 euros)
(Reporting by Maria Sheahan. Additional reporting by Andreas Cremer.; Editing by Ron Askew.)
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