Business Briefs – May 9, 2016

Small-Car Deals Abound as U.S. Buyers Go Crazy for SUVs

DETROIT (AP) — With many Americans rushing to buy trucks and SUVs, there are good deals to be had on cars, especially smaller models.

In April, supplies of small cars on dealer lots grew to the highest level in seven years. Automakers are resorting to discounts and sweetened lease deals to sell — especially with models that haven’t been updated in a few years.

So far this year, about 54 percent of U.S. vehicle sales have been trucks and SUVs. Just two years ago, cars ruled the market at 51 percent.

Krispy Kreme Shares Soar on Sweet Takeover Offer

NEW YORK (AP) — Krispy Kreme is being taken private by JAB Beech for about $1.35 billion.

It adds a doughnut chain to the investment firm’s coffee holdings. JAB Beech owns Keurig Green Mountain, Peet’s Coffee & Tea and Caribou Coffee. JAB Holdings, which is predominantly owned by the Reimann family in Europe, also has stakes in Jacobs Douwe Egberts, the company behind Gevalia, Tassio and other brands.

The companies said Krispy Kreme will continue to be independently operated from its headquarters in Winston-Salem, N.C.

Gap Sales Slide in April, Retailer Gives Downbeat Outlook

SAN FRANCISCO (AP) – Gap shares tumbled in after-hours trading Monday after the struggling retailer reported worse-than-expected sales, issued a profit warning for the first quarter, and announced that it is mulling options for its business outside North America.

The San Francisco-based retailer said that sales in April at stores open at least a year — a key metric of a retailer’s health — fell 7 percent. That fell short of analyst expectations for growth of 0.5 percent, according to Thomson Reuters.

LendingClub CEO Resigns After Internal Probe of Loan Sale

NEW YORK (AP) – The chairman and CEO of the online lending company LendingClub stepped down after an internal review determined that the company’s business practices were violated with the sale of $22 million in loans to people with sketchy credit scores to a single investor.

The departure of Renaud Laplanche, along with the firing or resignation of three senior managers involved in the sale, sent shares of the company plunging Monday.

It’s not immediately clear what role Laplanche played, but the company said that the transaction “failed to conform to the investor’s express instructions.”

Penney to Expand Major Appliances to Half of Its Stores

NEW YORK (AP) – J.C. Penney says it will start to sell major appliances online and expand its rollout of the category to nearly 500 stores, or almost half of its stores, this summer.

The move comes after a successful test of offering major appliances such as washing machines and refrigerators in 22 markets in February. Penney got out of the major appliance business more than 30 years ago.

Penney also said Monday that it exceeded its own goal for one measure of profit. Its shares edged up in midday trading Monday.

Takata Expects to Sink Into Loss, Instead of Posting Profit

TOKYO (AP) – Japanese auto parts maker Takata Corp. is expecting a loss for its fiscal year because of ballooning costs from a massive global air-bag recall.

Takata said Monday it is projecting an annual net loss of 13 billion yen ($120 million). The Japanese manufacturer had earlier forecast a profit of 5 billion yen ($46 million).

The company’s products are part of the largest recall in U.S. history. Inflators inside the air bags can explode with too much force and spew shrapnel they are responsible for at least 11 deaths worldwide and more than 100 injuries.

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