ECONOMY

Confidence drops in May

Americans’ confidence in the economy fell in May to its lowest level in eight months as consumers fretted about slow hiring, a big stock market drop and the global economy, says a private research group.

The Conference Board says its Consumer Confidence Index now stands at 64.9, down from a revised 68.7 in April. Economists were expecting a reading of 70, according to a FactSet poll of analysts. The current level is below February’s 71.6, which is the highest level it’s been in a year.

Consumer spending accounts for 70 percent of economic activity. The measure is significantly below the 90 reading that indicates a healthy economy. But the current level is well above the 40 it hit last October.

Dow posts gain of 126

The Dow Jones industrial average gained 125.86 points Tuesday to 12,580.69. Of 30 components, 28 traded higher, led by Bank of America Corp., up 4.1 percent.

The S&P 500 index rose 14.60 points, or 1.1 percent, to 1,332.42. The Nasdaq composite index advanced 33.46 points, or 1.2 percent, to 2,870.99.

Facebook Inc. shares ended down 9.6 percent to $28.84 as their first day of options trading began. Shares are now 25 percent below their IPO price.

AUTO INDUSTRY

Chrysler van ends

Chrysler Group LLC, the inventor of the minivan, plans to discontinue the Chrysler Town & Country minivan and keep the Dodge Caravan as its only minivan in 2014 and also plans to discontinue production of the Jeep Compass.

The news about the minivan plans was first reported by Automobile Magazine in the July issue now hitting newsstands and was confirmed by a person familiar with Chrysler’s plans.

Chrysler and Fiat SpA CEO Sergio Marchionne has previously said the company would offer just one minivan in the future, but most expected that the Town & Country would survive. Now, Marchionne has revealed that the Caravan will remain and the Town & Country will be replaced by a new crossover. It is unclear if the Town & Country name will continue.

Marchionne decided that Dodge should retain the minivan because the minivan was first introduced as a Dodge Caravan in 1983 by then-Chrysler CEO Lee Iacocca.

By having two minivans, Chrysler has been able to cover a wide price range for consumers. The Caravan sells for about $20,000 to $30,000 while the more upscale Town & Country sells for $30,000 to $40,000. With both models, Chrysler captured 50 percent of U.S. minivan sales in 2011. Through April, the Auburn Hills, Mich., automaker has sold 45,865 Dodge Caravans and 38,507 Chrysler Town & Country minivans. Both minivans are produced at Chrysler’s Windsor (Ontario) Assembly Plant. Both the Compass and Jeep Patriot are made at Chrysler’s Belvidere (Ill.) Assembly Plant from the same platform.

Small Fiat-Mazda project

Fiat SpA’s partnership with Mazda Motor Co. is now limited to developing the new Duetto model as the Japanese carmaker has specific skills in making roadsters, Chairman John Elkann said at the annual general meeting of Exor SpA, the Agnelli family holding company that controls the Italian carmaker. Fiat, which will increase its stake in U.S.-based Chrysler by an additional 3 percent to over 61 percent in the second half of this year, has “no interest” in buying a stake in Mazda, Elkann said.

Electric debate for cars

Nissan is supplying New York City with fuel-efficient cabs, including six electric cars for testing, but acknowledged uncertainties about an ongoing “debate” over charging standards for electric vehicles. The battle in fast-charging stations, the equivalent of gasoline stands for electric vehicles, is threatening to turn into a futuristic replay of other major platform wars like VHS of Panasonic vs. Sony’s Beta in video. Nissan Executive Vice President Andy Palmer said the debate was still going on, and it was unknown whether nations will adopt the system called CHAdeMo used by Nissan, or the competing one called Combo backed by General Motors and European automakers. The standards use different plugs and aren’t compatible. Palmer said Nissan as a leader in electric vehicles must convince others that its standard is the best.

Ad agency gets OK

General Motors said Pernilla Ammann, the wife of Chief Financial Officer Dan Ammann, is an officer and a partner in an advertising agency that received about $600,000 for services last year to a GM subsidiary. The transaction was “properly ratified” under the Detroit-based company’s policy covering related-party transactions, GM said.

Compiled from staff and wire reports