Boeing Dreamliner cleared to fix battery, start flying again

The Federal Aviation Administration cleared Boeing to make fixes to the battery system of the 787 Dreamliner. That paves the way for the aircraft to start flying again.

WASHINGTON (CNNMoney)

Nearly 50 Dreamliners have been grounded for the last four months, after two fires on Japanese jets prompted the FAA to order the planes grounded on Jan. 16.

Since then, Boeing (BA, Fortune 500) has redesigned the battery system. Next week, all airlines that have the 787 aircraft will start to install the new systems with the help of special teams deployed by Boeing, said spokesman Marc Birtel. He couldn't say when the 787 Dreamliners would begin flying again.

Boeing basically revamped the internal battery components to minimize the chances of a short circuit. It also improved the insulation of the battery cells, and created a new "containment and venting" system that is supposed to prevent overheating from affecting the plane.

"Safety of the traveling public is our number one priority. These changes to the 787 battery will ensure the safety of the aircraft and its passengers," said Transportation Secretary Ray LaHood.

The move to approve the planes for flight has been expected. FAA Administrator Michael P. Huerta predicted at a Senate hearing on Tuesday that it would happen soon.

Boeing has already completed 20 tests with the new battery technology, Huerta said during that hearing.

United Airlines (UAL, Fortune 500), which has six of the jets, is the only U.S. airline to take delivery of the Dreamliners so far. Boeing's customers are eager to get them into service, since they use lightweight composite materials that greatly improve fuel economy.

The Dreamliner has sold well in Asia and the Middle East, where airlines depend on long-range flights for much of their business, and can benefit most from the improvements in fuel economy.

The problems with the new battery technology have already prompted Boeing's European rival Airbus to revert to standard nickel-cadmium batteries in its A350 plane. The A350 had been designed to compete with the Dreamliner, and is due to make its first test flight in the middle of this year.

The approval for the battery fix comes just a few days before the National Transportation Safety Board, which investigates traffic and aircraft incidents, will convene for a two-day investigation into the fires.

Boeing's shares were up 2% Friday afternoon.

-- CNN's Mike Ahlers contributed to this report.

First Published: April 19, 2013: 4:02 PM ET

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AB InBev and Modelo merger set to move forward

Anheuser-Busch InBev and Grupo Modelo are currently the number-one and -three brewers in the U.S. market, respectively.

NEW YORK (CNNMoney)

The Justice Department announced Friday that it had reached a settlement with Anheuser-Busch InBev and Grupo Modelo to resolve the anti-trust suit it filed earlier this year in response to their proposed merger.

Under the agreement, Anheuser-Busch InBev (BUD) can move ahead with plans to acquire the 50% of Grupo Modelo (GPMCF) it does not already own for $20.1 billion, but it must sell Modelo's U.S. business in order to preserve competition in the American beer market. It must also sell one of Modelo's brewing facilities in Mexico.

The proposed buyer is Constellation Brands -- a wine and liquor producer whose brands include Robert Mondavi and SVEDKA Vodka -- which will acquire the assets for roughly $4.75 billion. Constellation will then have the exclusive right to sell Modelo products in the U.S.

The settlement is subject to a 60-day comment period before it goes before a judge for approval.

The Justice Department's Bill Baer called the agreement "a win for the $80 billion U.S. beer market and consumers."

"Before the merger, there were two competitors -- Modelo and ABI -- and ABI owned a substantial stake in Modelo. The companies' proposed merger would have reduced those two competitors to one -- ABI," Baer said in a statement. "The proposed settlement announced today will create an independent, fully integrated and economically viable competitor to ABI."

ABI was created in 2008 when Belguim's InBev took over Anheuser-Busch in a $52 billion transaction. It currently leads all brewers with a 39% share of the U.S. beer market, producing more than 200 brands including Budweiser, Busch, Michelob and Stella Artois.

Modelo, based in Mexico, is number three in the U.S. market with a 7% share. It produces Corona Extra, the top-selling import in the U.S., as well brands like Modelo Especial and Pacifico.

Related: Small craft breweries hit it big

The two companies originally announced ABI's planned takeover last year, but the Justice Department sued to block the transaction. The companies announced a revised deal in February that was largely similar to the agreement announced Friday.

ABI said that once a judge signs off on the agreement, it will "move swiftly to complete the pending transactions" with Modelo and Constellation.

The Modelo merger "has always been about Mexico and making Corona more global in all markets other than the U.S.," ABI spokeswoman Laura Vallis said in an email. The combination, she added, will create "a significant growth opportunity worldwide from combining two leading brand portfolios and distribution networks."

As part of the new agreement, Constellation must expand production of current Modelo products for the U.S. market in order to help preserve competition. Constellation CEO Rob Sands called the deal "a significant milestone for Constellation as the most transformational event in the history of our 68-year-old company."

"Overall, this transaction will nearly double the sales of our company, significantly enhance our earnings and free cash flow, diversify our profit stream and provide new avenues for growth," Sands said in a statement.

Modelo did not immediately respond to a request for comment.

Constellation (STZ) shares closed up 2.5% Friday following the announcement, while Anheuser-Busch InBev rose 1.7%.

First Published: April 19, 2013: 6:02 PM ET

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Netflix hopes for 'House of Cards' boost

Netflix is hoping its investment in original programming, including Kevin Spacey's "House of Cards," pays off in the form of new subscribers.

NEW YORK (CNNMoney)

The streaming video company will report first-quarter earnings on Monday, and the first question on many investors' minds will be about how the splashy Kevin Spacey political thriller "House of Cards" performed.

Netflix's biggest original series to date reportedly cost an eye-popping $100 million to produce and shoot two seasons. The company hopes that investment pays off in the form of new subscribers.

Netflix (NFLX) first announced the original programming scheme in late 2011, and since then, executives and spokespeople have repeated the party line: "We want to become HBO faster than HBO can become Netflix."

To do that, Netflix is rolling out a long list of original series this year in addition to "House of Cards." The slate also includes a second season of "Lilyhammer," an upcoming new season of the canceled show "Arrested Development," a new series from horror-flick master Eli Roth, one from comedian Ricky Gervais and another from "Weeds" creator Jenji Kohan.

The price tags might be high, but Netflix spokesman Joris Evers insisted to CNNMoney in February that the company spent about the same amount on "Cards" as it would have on an exclusive streaming deal with an outside studio.

Those expensive licensing deals are precisely why Netflix is branching out. Studios have demanded more for their valuable content in the past two years, as they can now shop their shows around to other services: Hulu, Redbox (CSTR), Amazon (AMZN, Fortune 500) and more. HBO (owned by CNNMoney parent company Time Warner (TWX, Fortune 500)) and CBS (CBS, Fortune 500)' Showtime are also expanding their streaming offerings.

Related story: New Netflix Facebook app lets users share viewing history

The content licensing bills weighed significantly on Netflix's profit last year, as the company earned just $17 million for all of 2012. Plus, Netflix is on the hook for at least $5.6 billion over the next few years to pay for its licensing deals.

That's a hefty bill, but some analysts have also expressed concern about the costs of the original series. Others have dinged Netflix's choice to release all episodes at once, pointing out that someone could sign up for a month to watch "Arrested Development" and promptly cancel.

But CEO Reed Hastings is convinced original programming is the way to set Netflix on the right path for the long term. In February, Netflix said it's considering issuing debt in order to raise capital and fund more series.

Investors appear optimistic. After a massive sell-off that lasted from late 2011 through all of 2012 -- which some industry watchers deemed an overreaction to Netflix's troubles -- the stock is up an incredible 80% so far in 2013.

Netflix isn't the only company with its eye on original content, however. Amazon posted 14 new TV pilots online on Friday, letting users watch for free and asking them to provide feedback on which should become full series.

First Published: April 21, 2013: 10:32 AM ET

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Another Honda recall: 225,000 SUV's and minivans affected

The 2012 CRV is among the vehicles affected by the Honda recall.

NEW YORK (CNNMoney)

In the U.S., the recall affects roughly 128,000 Honda CR-V's and 59,000 Odysseys from model years 2012 and 2013, as well as 17,500 Acura RDX's from 2013, Honda said in a statement. Some 14,000 CR-V's, 4,500 Odysseys and 2,300 RDX's in Canada are also being recalled.

Honda said that in sub-freezing temperatures, these vehicles may be shifted out of park even with the brake pedal isn't depressed. There haven't been any complaints, crashes or injuries reported in connection with this issue, the Japanese automaker said.

Honda (HMC) will notify vehicle owners of the problem and direct them to dealerships where the issue will be resolved free of charge. Owners can check if their vehicle needs to be repaired at www.recalls.honda.com and www.recalls.acura.com.

This week's recall follows several similar headaches in the past few months.

In January, the company announced the recall of 748,000 Odyssey minivans and Pilot SUVs because of problems with their airbags. In March, the automaker ordered the recall of 180,000 vehicles in the United States, and almost 250,000 worldwide, because of a defect that could potentially cause the brakes to be applied inadvertently.

Just last week, Honda announced the recall of 1.1 million vehicles in order to replace their passenger airbag inflators.

In all cases, the company said it was not aware of any injuries resulting from the problems.

First Published: April 19, 2013: 12:53 PM ET

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Boeing Dreamliner cleared to fix battery, start flying again

The Federal Aviation Administration cleared Boeing to make fixes to the battery system of the 787 Dreamliner. That paves the way for the aircraft to start flying again.

WASHINGTON (CNNMoney)

Nearly 50 Dreamliners have been grounded for the last four months, after two fires on Japanese jets prompted the FAA to order the planes grounded on Jan. 16.

Since then, Boeing (BA, Fortune 500) has redesigned the battery system. Next week, all airlines that have the 787 aircraft will start to install the new systems with the help of special teams deployed by Boeing, said spokesman Marc Birtel. He couldn't say when the 787 Dreamliners would begin flying again.

Boeing basically revamped the internal battery components to minimize the chances of a short circuit. It also improved the insulation of the battery cells, and created a new "containment and venting" system that is supposed to prevent overheating from affecting the plane.

"Safety of the traveling public is our number one priority. These changes to the 787 battery will ensure the safety of the aircraft and its passengers," said Transportation Secretary Ray LaHood.

The move to approve the planes for flight has been expected. FAA Administrator Michael P. Huerta predicted at a Senate hearing on Tuesday that it would happen soon.

Boeing has already completed 20 tests with the new battery technology, Huerta said during that hearing.

United Airlines (UAL, Fortune 500), which has six of the jets, is the only U.S. airline to take delivery of the Dreamliners so far. Boeing's customers are eager to get them into service, since they use lightweight composite materials that greatly improve fuel economy.

The Dreamliner has sold well in Asia and the Middle East, where airlines depend on long-range flights for much of their business, and can benefit most from the improvements in fuel economy.

The problems with the new battery technology have already prompted Boeing's European rival Airbus to revert to standard nickel-cadmium batteries in its A350 plane. The A350 had been designed to compete with the Dreamliner, and is due to make its first test flight in the middle of this year.

The approval for the battery fix comes just a few days before the National Transportation Safety Board, which investigates traffic and aircraft incidents, will convene for a two-day investigation into the fires.

Boeing's shares were up 2% Friday afternoon.

-- CNN's Mike Ahlers contributed to this report.

First Published: April 19, 2013: 4:02 PM ET

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AB InBev and Modelo merger set to move forward

Anheuser-Busch InBev and Grupo Modelo are currently the number-one and -three brewers in the U.S. market, respectively.

NEW YORK (CNNMoney)

The Justice Department announced Friday that it had reached a settlement with Anheuser-Busch InBev and Grupo Modelo to resolve the anti-trust suit it filed earlier this year in response to their proposed merger.

Under the agreement, Anheuser-Busch InBev (BUD) can move ahead with plans to acquire the 50% of Grupo Modelo (GPMCF) it does not already own for $20.1 billion, but it must sell Modelo's U.S. business in order to preserve competition in the American beer market. It must also sell one of Modelo's brewing facilities in Mexico.

The proposed buyer is Constellation Brands -- a wine and liquor producer whose brands include Robert Mondavi and SVEDKA Vodka -- which will acquire the assets for roughly $4.75 billion. Constellation will then have the exclusive right to sell Modelo products in the U.S.

The settlement is subject to a 60-day comment period before it goes before a judge for approval.

The Justice Department's Bill Baer called the agreement "a win for the $80 billion U.S. beer market and consumers."

"Before the merger, there were two competitors -- Modelo and ABI -- and ABI owned a substantial stake in Modelo. The companies' proposed merger would have reduced those two competitors to one -- ABI," Baer said in a statement. "The proposed settlement announced today will create an independent, fully integrated and economically viable competitor to ABI."

ABI was created in 2008 when Belguim's InBev took over Anheuser-Busch in a $52 billion transaction. It currently leads all brewers with a 39% share of the U.S. beer market, producing more than 200 brands including Budweiser, Busch, Michelob and Stella Artois.

Modelo, based in Mexico, is number three in the U.S. market with a 7% share. It produces Corona Extra, the top-selling import in the U.S., as well brands like Modelo Especial and Pacifico.

Related: Small craft breweries hit it big

The two companies originally announced ABI's planned takeover last year, but the Justice Department sued to block the transaction. The companies announced a revised deal in February that was largely similar to the agreement announced Friday.

ABI said that once a judge signs off on the agreement, it will "move swiftly to complete the pending transactions" with Modelo and Constellation.

The Modelo merger "has always been about Mexico and making Corona more global in all markets other than the U.S.," ABI spokeswoman Laura Vallis said in an email. The combination, she added, will create "a significant growth opportunity worldwide from combining two leading brand portfolios and distribution networks."

As part of the new agreement, Constellation must expand production of current Modelo products for the U.S. market in order to help preserve competition. Constellation CEO Rob Sands called the deal "a significant milestone for Constellation as the most transformational event in the history of our 68-year-old company."

"Overall, this transaction will nearly double the sales of our company, significantly enhance our earnings and free cash flow, diversify our profit stream and provide new avenues for growth," Sands said in a statement.

Modelo did not immediately respond to a request for comment.

Constellation (STZ) shares closed up 2.5% Friday following the announcement, while Anheuser-Busch InBev rose 1.7%.

First Published: April 19, 2013: 6:02 PM ET

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Toyota to bring 750 jobs to Kentucky

Toyota Motor president Akio Toyoda, shown here in an image from 2010, announced Friday that the company is bringing Lexus production to Kentucky, adding 750 jobs.

NEW YORK (CNNMoney)

Toyota Motor (TM) President Akio Toyoda announced that the company would build the Lexus ES sedan at the Kentucky plant where Toyota currently builds Camry, Camry Hybrid, Avalon Hybrid and Venza models.

"Lexus was founded in the United States, so it is only fitting that we are bringing the production of luxury sedans for our U.S. customers back to where the brand was born," said Toyoda, in a press conference.

Related: Car makers take Silicon Valley

The company does not currently build any Lexus models in the United States. It plans to begin making Lexus cars at the plant in 2015, adding 50,000 vehicles per year to the factory's production.

In a bid for the expansion, Kentucky gave Toyota nearly $150 million in state and local tax incentives, according to state documents.

The company said it is investing $360 million in into the factory.

Related: Remington jobs rule the Rust Belt

The state unemployment rate currently stands at 7.9%, slightly higher than the national average of 7.7%. Scott County, where the plant is located, has an unemployment rate of 7%.

The plant is located on a 1,300-acre plot, and has a capacity to build 500,000 vehicles and engines, making it Toyota's first and largest factory in North America, according to state documents.

First Published: April 19, 2013: 10:10 AM ET

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