Businesses Reel from Hurricane Sandy
Northrop Grumman closed facilities in Suffolk, Va., Columbia, Md., Pleasantville, N.J., J Street, N.Y., and Middletown, R.I., Industry Week reports. Lockheed Martin also closed several facilities on Monday and Tuesday.
GM said its Maryland transmission plant was closed yesterday, and its vehicle sales in the northeast will be hurt by the storm, although it declined to put a dollar amount on Sandy’s effects, according to Reuters. Ford said its sales would also be affected, but all plants were operating normally.
Predictions for Sandy’s total impact on the US economy vary widely – some economists say it could cost up to $45bn in damage and lost production, with the losses from closed businesses and drops in consumption possibly outweighing the cost of physical damage, the Guardian reports. So far the storm has caused over 18,000 flight cancellations, and the major New York City airports remain closed, the Christian Science Monitor says – with flooding at LaGuardia (pictured) making it unclear when that airport will re-open.
But long-term the storm is unlikely to have a big effect on the economy, ABC said. Airlines, insurance companies and many retailers will suffer, but home improvement stores and construction companies could benefit. Local, state and federal rules could force many homeowners to rebuild to higher standards. The storm forced about 70 percent of oil refineries on the east coast to shut down, which could push gasoline prices up – but prices could also fall, as many roads remain impassable.
With most of lower Manhattan still in the dark, the New York Stock Exchange re-opened this morning using a generator for power. The planned resumption of trading helped push up markets in Europe and Asia today, the Washington Post reported. But trading could be erratic. A number of companies postponed earnings reports over the last two days, leading to a backlog. Today is also the last day of the trading month, when many investors try to improve their accounts.
The storm also forced Danaher Corp. to push back the deadline for its tender offer to buy IRIS International, Industry Week said.
Meanwhile American Apparel launched a “Sandy Sale,” offering 20 percent off all items to customers in the affected states. Similarly, an Urban Outfitters email advertised: “This Storm Blows, But Free Shipping on All Orders Doesn’t.”
Some customers took to Twitter to brand the American Apparel campaign tasteless, but a company spokesman told ABC News, “We would never try to offend anyone or capitalize on a natural disaster. This was simply an effort to mitigate some of the effects of the storm on our business.” He said the weather had forced American Apparel stores to shut and its factory to sit idle.
Photo: LaGuardia Airport under water. Posted by JetBlue.
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