FTC seeks to block Kate Spade, Michael Kors merger
(NEW YORK) — The Federal Trade Commission is asking a federal judge in New York to block the $8.5 billion merger of Tapestry, the company behind Coach, Kate Spade, and Capri, which controls Michael Kors.
In April, the FTC sued to block the sale, arguing that these brands dominate what’s known as the “accessible luxury” market and that if they combined, consumers would suffer by paying higher prices.
“This has to be the first time the focus of a federal court hearing turned to a $279 Kate Spade tote described as ‘colorful, joyful, feminine, green and white seen on Emily in Paris,” ABC News senior investigative reporter and correspondent Aaron Katersky said on Good Morning America Tuesday.
Tapestry argues the FTC is ignoring the reality of a marketplace, in which consumers have a lot of choices, suggesting it takes a mere stroll through Bloomingdale’s or Macy’s to see Gucci, Kors and Calvin Klein bags fighting for attention.
Michael Kors himself testified last month during a hearing, telling the judge there’s already plenty of competition for handbags, noting that he learned about one brand when he saw a photo of pop superstar Taylor Swift wearing an Aupen bag similar to those made by Kate Spade.
Kors also testified his handbags have “reached a point of brand fatigue” and a lawyer arguing in favor of the merger said it would revitalize the Michael Kors brand, so consumers have yet another choice. The goal, he said, is to sell more handbags to consumers.
The judge took these arguments under advisement and could rule at any time.
(NEW YORK) — United Airlines flight attendants, represented by the Association of Flight Attendants, moved closer to a strike Wednesday after the union announced that 99.99% of service members voted in favor of strike authorization.
The vote included 90% of the United Airlines flight attendant staff.
Among the strike requests, flight attendants are demanding significant double-digit base pay increases, being compensated for time at work outside of flights, schedule flexibility and work rule improvements, job security, retirement and more, according to the union.
The historic vote marked the first time in 20 years that United flight attendants have authorized a strike, since the airline’s 2005 bankruptcy negotiations.
However, a strike will not occur immediately and despite the vote, there will be no immediate disruptions to airline operations.
Experts say it’s highly unlikely United flight attendants will actually walk off the job. There are a number of steps that must happen before a strike can take place and the president and Congress have the power to stall or stop an airline strike.
“To be clear, there is no work stoppage or labor disruption,” United told ABC News in a statement Wednesday. “Off-duty flight attendants are simply exercising their right to conduct an informational picket.”
The results of the strike authorization vote were announced as nearly 20 informational picket lines were seen at airports across the country.
“We deserve an industry-leading contract. Our strike vote shows we’re ready to do whatever it takes to reach the contract we deserve,” Ken Diaz, president of the United chapter of the Association of Flight Attendants, said in a statement Wednesday.
“We are the face of United Airlines and planes don’t take off without us. As Labor Day travel begins, United management is reminded what’s at stake if we don’t get this done,” he added.
After this week, the union walked away from federally mandated negotiations. The union will now ask the National Mediation Board to release them into a 30-day “cooling-off” period, which would set a potential strike deadline.
“The United management team gives themselves massive compensation increases while Flight Attendants struggle to pay basic bills,” Diaz continued. “The 99.99% yes vote is a clear reminder that we are unified in the fight against corporate greed and ready to fight for our fair share of the profits we create.”
Similar strike authorization votes have been cast at competing airlines including American, Alaska, Southwest, and more.
(NEW YORK) — Amazon is expanding its grocery footprint, simplifying online shopping and launching a “new no-frills brand” to help consumers stretch their dollar, while taking aim at rival retail competitor Walmart.
On Wednesday, the retail tech giant, which owns Whole Foods as well as its own grocery service Amazon Fresh, announced expanded Prime member savings both in-store and online, the launch of a new private label brand, Amazon Saver, and enhancements to the online user experience.
“We’re always looking to make grocery shopping easier, faster, and more affordable for our customers,” Claire Peters, worldwide vice president of Amazon Fresh, said in a statement. “With expanded Prime member savings, the introduction of the new Amazon Saver brand, and simplified online shopping, it’s now easier than ever to get your weekly grocery shopping done on a budget with Amazon Fresh — whether you’re browsing the aisles or filling your online cart.”
What is Amazon Saver?
Amazon’s new private label brand, Amazon Saver, will offer an array of grocery staples from crackers and cookies to canned fruit and condiments.
Most Amazon Saver items will be priced under $5, and Prime members will get an additional 10% off these products.
“Amazon Saver complements our selection of private-label brands, designed to provide the best value for a wide range of grocery products,” the company said in a press release. “We’ve just started to roll this new private label out with several products, and will add more than 100 items to the Amazon Saver selection over time.”
As of time of publication, some items include a 42-ounce can of oats for $3.99, several flavors of 15-ounce coffee creamers for $3.49 each, and a 15-ounce can of traditional pizza sauce for $1.09.
Hitha Herzog, retail expert and chief research officer of H Squared Research, told ABC News’ Good Morning America that as a parent company, “Amazon has several different brands and grocery silos within the grocery umbrella — and with Amazon Saver, we are talking just basics.”
“What is different about Amazon is that the logistics of them handling the product to the customer is at the top. They are able to get this product very quickly,” Herzog said.
The new line from Amazon takes on other budget-friendly private labels like Great Value from Walmart, Good & Gather from Target, and Bowl & Basket from ShopRite.
Food prices post-pandemic continue to rise
Food prices have been volatile for both the at-home and away from home categories, with two of the six major grocery indexes — meats, eggs and produce, as well as dairy — on the rise, even as inflation cooled, according to August Consumer Price Index data from the Bureau of Labor Statistics.
While there are some signs of stabilization after rapid increases during the last three years out of the COVID-19 pandemic — which resulted in massive supply chain issues with labor shortages from farms and producers to manufacturing and distribution — the cost of food is still a considerable expense.
According to the United States Department of Agriculture, families spent more than 11% of their disposable income on food in 2023, with a little over 5% of that going to groceries.
(NEW YORK) — Shares in former President Donald Trump’s social media company fell to a record low Wednesday on the heels of Tuesday’s presidential debate, which a CNN poll indicated was won by Vice President Kamala Harris.
Shares of Trump Media & Technology Group, the parent company of Truth Social, closed down 10.5% Wednesday to end the day at a record low.
Shared dipped as much as 17% Wednesday before slightly improving at the close of trading.
For some investors, Trump Media serves as a bellwether for the former president’s odds in the upcoming presidential election. When Trump was convicted on 34 felony counts in New York in May, the company’s stock price tumbled — but the stock surged in the days following the July presidential debate and the assassination attempt on the former president.
Analysts have said that the company’s stock performance is removed from the financial outlook of the company, which reported losing more than $16 million over a three-month period ending in June during which it only brought in $836,000 in revenue.
The stock price has been buoyed by a number of passionate individual investors who bought shares in the company to support Trump or because they believe in the company’s mission.
Next week, Trump faces a pivotal choice about his investment in the company. The lockup provision that barred him from selling his shares for the first six months since the company went public expires next week, meaning that Trump could begin selling his shares in the company as early as Sept. 19.
According to filings with the Securities and Exchange Commission, Trump owns approximately 115 million shares of the company, which are worth nearly $2 billion based on Wednesday’s stock price.
On paper, Trump has lost more than $4 billion in his stake over the last six months as the company’s stock price has declined.
A representative for Trump Media & Technology Group did not immediately respond to a request for comment from ABC News.