By David Rosenberg, for The Media Line. Reproduced with permission by Iraq Business News . It was just another day in Iraq on July 15. In the city of.
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In a July 28 story about the NAACP convention, The Associated Press incorrectly quoted a comment by Judith A. Browne-Dianis, co-director of the Advancement Project in Washington D.C. due to typographical error.
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LONDON -(Dow Jones)- MyCelx Technologies Corporation, a technology company incorporated in Georgia, U.S., Friday said it will seek listing on London’s junior AIM market and will raise GBP12.2 million.
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Chevron Corp. said Friday that profit jumped 43 percent in the second quarter as higher oil and gasoline prices made up for a decline in oil production.
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Dear Driving for Dollars, My ex-husband bought our son a car. The title is in my name, with my ex-husband listed as the lien holder.
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WHY has the job picture been so bleak in the current recovery?
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Whether you’re a recent high school graduate or an adult hoping to pick up a new trade, attending college can — and will — put a major strain on your finances.
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DETROIT — Four years ago, the American auto industry was so opposed to higher fuel economy standards that executives of Detroit camped out in Washington in an unsuccessful bid to undercut them.
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A federal judge ruled on Thursday that the bankruptcy trustee trying to recover billions for those who lost money in Bernard L. Madoffs enormous Ponzi scheme did not have the right to sue banks and other third parties on …
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Among the companies whose shares are expected to actively trade in Friday’s session are Starbucks Corp. (SBUX), Motorola Mobility Holdings Inc.
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Executives from the country’s biggest banks met with U.S. Treasury officials Friday to discuss how debt auctions will be handled if Congress fails to raise the borrowing limit before Tuesday’s deadline.
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A prepaid car maintenance plan might save you money, if you do your homework.
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SAN FRANCISCO — Technology stocks slipped early Friday as the broader market declined on news of weaker-than-expected U.S. economic growth and a possible U.S. debt default.
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Techs Slide On Econ News, But Yahoo, Expedia Rise
An El Segundo company aims to help the nation’s busiest seaport complex advance its green technology efforts by providing zero-emission trucks for heavy-duty hauling.
Executives from Vision Motor Corp. delivered a heavy-duty hauling truck Friday to one of the port complex’s most important cargo haulers, Total Transportation Services Inc. of Rancho Dominguez.
The Tyrano class 8 rig looks like any other big rig, but a hydrogen fuel cell powers an electric drive, emitting only water from the tailpipe. The ports of Los Angeles and Long Beach are billing it as the world’s first zero-emission heavy-duty hydrogen rig. If it performs to expectations during an 18-month test, Total Transportation plans to order at least 100 more.
Experts said the venture could set the stage for a new era in green cargo movement.
Fleets of zero-emission trucks with the range to deliver cargo to the Inland Empire’s warehouses and distribution centers would “eliminate one of the principal objections neighbors and governments have when freight and logistics are a major part of the local economy — that’s the problem of diesel emissions,” said economist John Husing, whose firm, Economics Politics Inc., tracks international trade.
The Tyrano uses a combination of technologies to operate with an expected range of 200 miles, said Rudy Tapia, vice president for business development for Vision Motor. The power flows through electric batteries, which are kept charged by a hydrogen fuel cell. No fossil fuels are used in the truck.
“Up and above the benefit of zero emissions, we at TTSI feel that this fuel format is the only true way to break our dependence on imported fuel. Hydrogen is the most abundant resource on the planet,” said Vic La Rosa, president of Total Transportation , a hauling and logistics company that moves freight and provides warehousing and rail service and handles shipments through seaports in Los Angeles, Long Beach, San Diego, Seattle, Tacoma, Wash., and Norfolk, Va.
Getting Total Transportation onboard for the test was a big boost, said Martin Schuermann, chief executive of Vision Motor.
“It underlines our assumptions that there are multiple commercial applications for our hydrogen powered zero-emission big rigs in today’s trucking industry,” Schuermann said.
Officials at the ports of Los Angeles and Long Beach have a lot riding on the outcome. The nation’s largest and second largest cargo container ports, respectively, put up $425,000 in seed money for the development of the Vision Motor truck through their joint Technology Assistance Program, which has an annual budget of $1.5 million. The program has funded several projects, including a hybrid diesel tugboat from Seattle-based Foss Maritime Co.
“We really want to see the truck put through the paces to see how durable the fuel cell system is,” said Heather Tomley, director of environmental planning for the Port of Long Beach. “We’re hoping that it works as well as they think it will.”
In addition to the on-road Tyrano, Total Transportation will test a Vision Motor truck more like the common terminal tractor, designed to move containers inside the ports.
Kevin Maggay, air quality supervisor for the Port of Los Angeles, said its green technology efforts so far, including the introduction of fuels that pollute less than earlier versions, were just the beginning.
“We have made great strides in reducing emissions, but we need to go further and we have to find new technologies to get us there,” Maggay said. “Clean diesel does not get us there.”
Vision Motor’s business plan may have tapped into a way to avoid the problem all small start-ups face — the inability to rapidly scale up to major factory production levels. It’s not building the trucks. It’s using Freightliner to provide the chassis and cab. It’s not building the electric motor, which is made by Siemens. The fuel cell is made by Hydrogenics Canada. Vision Motor will deliver the proprietary software to make the systems work together, Tapia said.
“We go with best of breed for the components for the best performance and durability and for the lowest costs,” Tapia said. “It’s the most capital efficient way to go.”
ron.white@latimes.com
California employers are hiring again, swelling payrolls by nearly 29,000 positions in June and allowing the state to outpace the nation in job growth as its start-and-stop recovery appears to have gotten back on track.
The state has added 110,000 jobs in the first half of the year, compared with just 83,000 positions for all of 2010.
Still, it’s an uneven recovery, with growth concentrated in affluent areas such as Silicon Valley and in high-paying fields such as professional services. Blue-collar trades such as construction and trucking continued to shed workers.
The divide suggests that as the recovery progresses, two economies are developing within California: one for more highly educated workers living on the coast, and one for inland workers with less schooling.
“Silicon Valley is not far from the San Joaquin Valley, but in economic terms, it may as well be on the other side of the ocean,” said Jeffrey Michael, director of the Business Forecasting Center at the University of the Pacific in Stockton. “The tech industry just does not spill over here.”
California added a total of 28,800 net jobs in June, the state Employment Development Department reported Friday, compared with a loss of a revised 21,100 jobs in May. The unemployment rate rose slightly, to 11.8%, from an adjusted 11.7% in May, as more formerly self-employed workers declared themselves out of work.
The San Francisco statistical area, which includes Marin, San Francisco and San Mateo counties, added 4,800 jobs in June.
Silicon Valley did even better, with Santa Clara and San Benito counties adding a combined 8,300 jobs. A tech boom is lighting up the area, where venture capitalists are pouring money into start-ups, office rents are rising and more new cars are popping up in employee parking lots.
In stark contrast, the Inland Empire, which includes Riverside and San Bernardino counties, lost 3,000 jobs in June. Fresno County alone shed 2,000. The signs are evident in the half-finished housing developments that dot the inland areas, and in the stores and businesses that are continuing to close, even as the recovery continues.
“I’m going out of business. It’s the economy. I don’t even break even,” said Jim Larson, who recently closed his collectibles store in Northern California’s Lake County, where the unemployment rate is a woeful 17.3%.
Pain is spread through inland areas up and down the state: Fresno’s St. Agnes Medical Center announced in June that it would cut 150 of about 2,800 positions, citing “a weakened economy and declining reimbursement.” Salinas-based Ramco Enterprises, which does staffing for food processing companies, said it plans to eliminate 357 jobs, according to a WARN Act notice, which requires businesses to give notice of large-scale layoffs.
But few places are harder hit than Southern California’s Inland Empire, which can’t seem to catch a break. The region encompassing Riverside and San Bernardino counties has jettisoned 11,400 jobs since June 2010; the state has added 156,800 over the same time period. Unemployment rates in many of its cities top 20%.
The region suffers from a falloff in construction, from sporadic trade activity and from cuts in the government sector, which is a big employer there.
Some Riverside County communities, including Beaumont and Murrieta, have seen the number of vacant units double from 2000 to 2010, according to census data.
Depressed housing values and tepid demand means that many of those homes could remain vacant for years, said Jerry Nickelsburg, a senior economist with the UCLA Anderson Forecast.
“It’s going to take awhile for the population to grow, to fill up all those homes and boost home prices to the point where it pays to build again,” he said. “The building that you’re seeing is multifamily housing in coastal communities.”
Nickelsburg released a forecast last month suggesting that rising fuel prices will encourage people to live in multifamily homes on the coast, abandoning exurbs further inland. Construction employment won’t return to pre-recession levels until 2021, he predicted.
In San Bernardino County, the volume of home sales dropped 18.3% from last June, and in Riverside the volume of sales fell 14.7%, according to DataQuick.
Job losses cut across almost all sectors in the Inland Empire. Leisure and hospitality shed 3,200 jobs in June, and educational and health services declined by 1,300 positions. Financial activities accounted for 1,000 job losses.
The region has shed 3,900 construction jobs over the year and has lost 75,100 construction jobs from peak employment in June 2006.
You may not be able to taste it, but that taco you’re about to devour may have a little less salt than it used to.
Whether serving fast food or cooking up gourmet meals, restaurants are cutting back on salt. It’s partly for your health, but it’s also to head off regulators who have already ordered them to post calorie counts on their menus and stop frying with trans fats.
Carl’s Jr. has cut 20% of the sodium from its hamburger buns. El Torito has whacked up to 30% of the sodium from its sauces and marinades. Taco Bell said last week that it had cut 20% of the sodium from its menu across the board.
“Everybody in the industry is looking at sodium reduction,” said Brad Haley, marketing chief for CKE Restaurants, which owns the Carl’s Jr. and Hardee’s chains. “Because we think this is the next legislative requirement that is going to come down.”
With federal officials preparing to release new rules requiring restaurants to post calorie counts on their menus, restaurant owners say they are convinced that salt is next. Throughout the industry, companies are rushing to cut back now, so they’re not caught by surprise if officials act quickly.
But here’s the rub: They hope you won’t notice. Tell customers they’re being served a low-sodium dish, the reasoning goes, and they’ll declare it bland even before they taste it.
“This is one of those reverse PR deals,” said Greg Drescher, executive director of strategic initiatives for the Culinary Institute of America. “You don’t want people to notice what you’re doing.”
Campbell Soup Co. may have learned the hard way. Reducing salt in its products too publicly — and by too much — is widely believed to have contributed to slumping sales in recent years. Just last week, the company announced it was adding back salt into many of its products.
But so far, restaurateurs say, there seems to be little public reaction to the changes they’re making.
At the Yard House restaurant at L.A. Live in downtown Los Angeles, customer Mark Maren said he had no clue that the Irvine-based chain recently switched to low-sodium soy sauce and quietly cut salt in several dishes.
Maren said he never thinks about salt when ordering his food — and definitely would not have been drawn to an item if it had been labeled low-sodium. “It’s not a big concern,” he said. “I don’t add salt, but what’s in there is in there.”
Socorro Leano, who was eating a plate of penne with chicken, is slim and fit. But she avoids dishes with too much salt. The pasta, she said, hit the right mix: “Not too salty, but not too bland.”
Americans love salt. Despite 40 years of public health warnings that too much sodium causes high blood pressure, leading to strokes and heart attacks, U.S. consumption has remained constant. And at an average of 3,400 milligrams a day, we’re eating way more than the recommended 1,500 to 2,300.
In fact, we’re in the middle of a gourmet salt boom. Boutique shops sell pink Himalayan rock salt and black salt flavored with truffles, as well as varieties with touches of lime, chile or espresso.
But if restaurants had to print sodium content on their menus, the numbers could be eye-opening.
A restaurant meal can have as many as 5,000 milligrams of sodium in it, experts say. An Angus bacon and cheeseburger from McDonald’s, for example, has about 2,000 milligrams — about a teaspoon’s worth. A single serving of salsa at Chipotle has 510 milligrams.
“Sodium should be on the menu next to calories,” said Laguna Beach resident Ann Weisbrod, 70, who has been on a low-sodium diet since developing high blood pressure during pregnancy. “It would shock people.”
Last year, a report by the National Institute of Medicine, an arm of the National Academy of Sciences that studies health and healthcare, called on regulators to require reductions in the salt content of packaged and restaurant food, saying that the industry had failed to police itself.
The U.S. Food and Drug Administration has not acted on the recommendation. But soon after, the city of New York asked companies to voluntarily reduce sodium in food, and most restaurant owners are convinced that regulations will soon follow.
The all-important back-to-school shopping season is threatening to slow the retail industry’s recent momentum.
As retailers roll out fresh back-to-school merchandise and tout early deals, a “shadow of insecurity” tied to the nation’s slow economic recovery still looms over many consumers and could hamper their spending, according to the National Retail Federation.
The retail trade group said in a report Thursday that families with children in kindergarten through high school would spend an average of $603.63 on apparel, school supplies and electronics, down slightly from $606.40 during last year’s back-to-school season.
According to the survey, budget-conscious shoppers will purchase more store-brand or generic items, comparison shop more online and shop for sales. And more people will put their shopping off until late in the season: 31.2% of respondents said they would begin their shopping one or two weeks before school starts, up from 24.8% last year.
Department stores are expected to see a surge in back-to-school traffic thanks to private label brands, promotions and aggressive social media campaigns. According to the survey, 57% of back-to-school shoppers will head to a department store, up from 53.9% last year and the most in the survey’s eight-year history.
At the college level, parents and students will spend an average of $808.71 on apparel, electronics, dorm furnishings and food items, down from $835.73 last year.
Combined kindergarten through college spending is expected to reach $68.8 billion, according to the National Retail Federation. Back-to-school is typically the second-largest sales driver of the year (after the winter holidays).
Another retail group, the International Council of Shopping Centers, has taken a slightly more optimistic tone, predicting this month that sales for the back-to-school season would rise 3% year-over-year.
Still, that would be a modest gain and below the mid-single-digit sales growth the industry has seen for much of this year.
– Andrea Chang
Barry Minkow is headed back to prison to serve a five-year sentence for securities fraud, but the ex-con who reinvented himself as a San Diego minister and crime fighter was looking on the bright side of his situation.
In his plea bargain to a single count of conspiracy, Minkow admitted that his falsehood-filled attacks on Lennar Corp. had caused the home builder to lose $583 million in stock market value. Because that amount was so huge, he might have been sentenced to 30 years or more had he gone to trial and been convicted instead of pleading guilty.
“Considering I deserved life without [parole], today could not have gone better,” Minkow said in an email to The Times from Miami, where U.S. District Judge Patricia A. Seitz imposed the maximum five-year sentence Thursday on the conspiracy charge.
Seitz gave Minkow 60 days to report to the work camp where he will serve his sentence, and Minkow said he believed the judge tried to understand his situation.
“The U.S. marshal walked me out of the courtroom and said: ‘That lady cares about you,’” Minkow said.
In material he prepared for his sentencing, Minkow said he had become addicted to painkillers as a result of having severe migraine headaches, and had been dependent on the strong and addictive drug Oxycontin before finally kicking the habit when he realized he was under criminal investigation.
He had asked to be placed in a special prison program for treating drug addiction, a request that the judge granted, he said. She also assigned him to a work camp in Montgomery, Ala., near his home in Tennessee.
“So all in all, it went very well,” Minkow said.
Minkow burst onto the national stage in the 1980s as the head of ZZZZ Best, a carpet and furniture cleaning company he started as a teenager in his parents’ garage in Reseda. He was widely hailed as a young genius until it was revealed that ZZZZ Best was built on credit-card fraud and fabricated work orders.
Minkow, who testified that mobsters had infiltrated his company, was convicted in 1988 of 57 fraud counts. He spent more than seven years in prison for defrauding investors, but after his release he reinvented himself as the chief minister at Community Bible Church in San Diego and head of his own Fraud Discovery Institute on the side.
In his latter role, he became closely watched by stock traders, especially short sellers, the speculative investors who place bets on declining stock prices.
He pleaded guilty in May to conspiring to torpedo the share price of Lennar by publicly denouncing the builder as “a financial crime in progress” — an attack he said was intended to force the Miami home builder to cough up cash and stock to settle a long and bitter legal battle with its partner in a private golf community in Rancho Santa Fe.
Minkow said he used the Internet and his contacts at the FBI to recklessly spread falsehoods about Lennar. In pleading guilty, he also acknowledged placing illegal bets himself that Lennar’s share price would fall based on confidential information — that the FBI had launched an investigation of the company based on his own allegations.
In sentencing Minkow, Seitz ordered him to pay $583 million in restitution to Lennar, a sanction to which Minkow already had agreed in a civil case.
L.A. attorney Daniel Petrocelli, who represented Lennar, issued a statement referring to the ongoing investigation and Minkow’s cooperation with federal authorities in hopes of someday having his sentence reduced.
“The Miami offices of the U.S. attorney and FBI deserve high praise for their efforts in prosecuting this case to protect the integrity of our securities markets,” Petrocelli said. “We expect that the other individuals responsible for the illegal attack on Lennar’s stock and shareholders will soon be brought to justice.”
Minkow has turned over thousands of pages of documents concerning the case to prosecutors. His attorney, Alvin Entin, predicted that Minkow would wind up serving a reduced sentence of three years after being credited with completing the drug program and assisting prosecutors.
But a former U.S. attorney who investigated Minkow said that merely trying to cooperate was not enough to warrant a recommendation for a truncated sentence. Minkow would have to provide “substantial assistance” enabling prosecutors to make a case against someone else, said Ryan O’Quinn, who has left the Miami prosecutors’ office and is now in private practice.
“Minkow sold himself as a hired gun, willing to employ his network to shake down corporate America,” O’Quinn said. “Fortunately, Lennar Corp. withstood Minkow’s pressure, helping the U.S. attorney in Miami to reveal the real financial crime in progress.”
scott.reckard@latimes.com
When we last checked in with CVS, the drugstore giant acknowledged that its rewards program for customers wasn’t working as intended and said a major fix was in the works.
Specifically, CVS’ chief marketing officer, Rob Price, told me the company was planning to do away with the practice of including cash-back rewards on people’s receipts, requiring you to schlep a yard-long slip of paper around with you until your next visit to the store.
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Instead, Price said, CVS had “a militia of technical people” working on a system that would store cash-back rewards on people’s ExtraCare cards, making it much more convenient for customers to enjoy the benefits of the loyalty program.
So a year has passed since that laudable news. And what do you know? I stopped by a CVS branch the other day and once again found my reward bucks printed on a yard-long receipt.
Was the company just blowing smoke when it pledged all those months ago that things were changing?
CVS now says I must have misunderstood Price when he said that “the receipt won’t be the currency going forward” and that “the goal is to have the reward stored in the customer’s card.”
Helena Foulkes, who oversees marketing for CVS Caremark, the drugstore chain’s parent company, told me the other day that CVS in fact isn’t working on doing away with printing rewards on receipts and the goal isn’t to store rewards in people’s cards.
“When you give rewards, you want people to feel excited,” she said. “You want them to know that they’ve earned the reward.”
This sense of excitement, Foulkes said, is achieved by handing customers something tangible — in this case, a receipt with their “Extra Bucks” printed on it — and requiring them to hand the receipt back the next time they purchase something.
“This makes people ‘feel the reward,’ ” she said.
That may be. But it also seems like a decidedly inconvenient way of rewarding loyal customers and a sure way of guaranteeing that relatively few people enjoy the benefits they’re entitled to.
Au contraire, said Foulkes. She said CVS’ data show that about half the 67 million customers enrolled in the Extra Bucks program happily carry around their receipts to redeem their rewards.
“That’s a number we’re really proud of,” Foulkes said.
They should be, considering that the industry average for coupon redemption is closer to 3%.
All I know is that when I stopped by a CVS store in downtown Los Angeles, most of the dozen or so people I met said they seldom remembered to keep their receipts on hand.
“I never use it,” said Koshawn Holt, 37, of South L.A. “The receipt always gets thrown away.”
Not always. Compton resident Angie Stovall, 48, showed me how she diligently wraps her receipt around her CVS card so it’s ready to go the next time she shops at the store.
But most others I spoke with said it’s too much hassle keeping track of receipts when you might not return to CVS for weeks at a time. And every single person I met, including those who routinely kept their receipts, said it definitely would be more convenient if CVS would just store the rewards on their card.
CVS gives customers 2% back on purchases every time they flash their rewards card at the cash register. You’ll also earn one Extra Buck for every two prescriptions you fill.
“We’re constantly working to make the program better,” CVS’ Foulkes said.
Along these lines, she said the company would soon introduce a service enabling customers to go online and select coupons they desire. By entering the number of their rewards card, the coupons can be stored in their account, awaiting their next visit to a store.
That’s good, as far as it goes, but it requires that customers be proactive in visiting the company’s website before shopping and entering data to get discounts. And it does nothing to encourage use of Extra Bucks.
Foulkes’ answer to that is a campaign CVS launched this month for customers to “stop money trashing.” In other words, the company wants people to stop throwing away those reward-laden receipts and instead put them to use.
“We want people to get the most out of their Extra Bucks,” Foulkes said.
If that’s really true, here’s the solution: Store Extra Bucks on people’s cards. Instantly, CVS’ redemption rate would soar to 100%.
What do you say? Would you prefer having reward cash stored on your plastic, or do you savor the excitement of carrying around your receipt? You can let CVS know by sending an email to extra@cvs.com. CC me as well and I’ll let you know the results.
David Lazarus’ column runs Tuesdays and Fridays. He also can be seen daily on KTLA-TV Channel 5. Send your tips or feedback to david.lazarus@latimes.com.
Giant bookseller Borders Group Inc. will begin liquidating its 399 stores nationwide, including huge sales at its 18 remaining stores in Southern California.
Books, DVDs and furniture valued at more than $700 million will be discounted up to 40% starting Friday, liquidators said. The sales are expected to wrap up in September.
Up to 10,700 chain employees nationwide, including 524 in Southern California, will lose their jobs after liquidation. Still up in the air is a possible sale of up to 35 locations to an Alabama company.
“This marks the end of an era, and we thank our customers for their patronage over our 40-year history. I encourage our customers to take advantage of this one-time opportunity to find exceptional discounts on their favorite books and other great merchandise,” Mike Edwards, president of Ann Arbor, Mich.-based Borders Group, said in a statement.
The liquidation plan was approved by a U.S. bankruptcy judge in New York on Thursday — as the bookseller inked its final chapter, finally defeated by poor management decisions, massive debt and a changing industry.
Until recently, the company looked as if it might stay in business. But last week, its unsecured creditors rejected a $215.1-million buyout bid from Najafi Cos. in Phoenix.
On Thursday, the judge gave the go-ahead for the sell-off to be handled by liquidators Hilco Merchant Resources and Gordon Brothers Group.
With Borders closing shop, more Americans will turn to online competitors for books and music — accelerating a trend that hurt Borders, said Al Greco, a book publishing expert and professor of marketing at Fordham University’s Graduate School of Business.
New York-based DJM Realty is handling the liquidation of the Borders leases, including those for Southern California stores in El Segundo, Mission Viejo, Brea, Torrance, Lakewood, Canoga Park and Northridge.
Alabama-based Books-a-Million Inc. put forth an offer Thursday to buy 30 stores. There were reports that the number could jump to 35, but few details of the bid were available. Neither Borders attorneys nor Books-a-Million officials could be reached for comment.
Beginning as a used-bookstore in 1971 in Ann Arbor — home to the University of Michigan — Borders helped pioneer the book superstore and thrived in the 1980s and 1990s with greater selections, cheaper prices and more leisure space than smaller, independent book shops.
But the company fumbled through the digital age, missing important shifts in the industry as consumers migrated online and toward digital books. Poor decisions by a series of executives unfamiliar with the publishing world severely hurt Borders, Greco said.
In 2001, it turned its online sales over to Amazon.com Inc., giving the competitor access to valuable customer data. Borders didn’t launch its own online sales operation until 2008. And it partnered with a Canadian firm to distribute an e-reader and launch an e-book store only last year — about three years after Amazon introduced its Kindle.
That was too late to stem falling sales. In February, Borders filed for bankruptcy. At the time, it had 42 stores in Southern California and has since closed 24.
Other bookstores might see a slight uptick in traffic from former Borders shoppers, but the chain’s closing isn’t good for anyone, Greco said.
Customers will have fewer places to shop. And publishers, who are likely to lose millions owed to them, have lost 399 outlets for promotions and their books, he said.
“This is a story where nobody is a winner,” Greco said.
andrew.khouri@latimes.com
Los Angeles survived “Carmageddon,” but now come the bus wars of Hollywood.
One of New York’s largest tour bus companies has launched a West Coast operation on Hollywood Boulevard, pitting itself against Southern California’s oldest and biggest tour bus company.
CitySights LA, a subsidiary of a New York bus company, has deployed a fleet of 14 double-decker buses to escort tourists around Hollywood, Beverly Hills and Venice and Santa Monica beaches.
The move makes CitySights one of the largest of more than a dozen tour companies in Hollywood and puts it in direct competition with Starline Tours, which was launched in 1968 and now runs 20 double-decker buses as part of a fleet of 80 tour buses around Los Angeles.
CitySights hopes to capitalize on its fleet of new, U.S.-built double-decker buses and its lower fares, said spokesman David Chien. He points out that several of Starline’s buses are older, renovated coaches, brought to the U.S. from Britain.
“Now we are the new kid on the block,” he said.
CitySights operates from a kiosk on the sidewalk near the corner of Hollywood Boulevard and Highland Avenue, but Chien said he expected that the company would add more buses and eventually move into a building nearby.
Starline executives say they are not worried about the new competition. Starline spokesman Klaus Ritter said his company would outlast its competitors because its guides and drivers have more experience in Hollywood.
“I think we have a better product,” he said. “We know the city the way outsiders don’t know the city.”
CitySights began operating on Hollywood Boulevard in June but formally launched its tours Thursday.
The two companies have already staked out their territory. Starline’s employees, wearing blue shirts, hawk their tours west of Highland Avenue, where they operate two kiosks next to Grauman’s Chinese Theatre and in front of the Hollywood and Highland Center.
CitySights’ salespeople, dressed in yellow shirts, stay east of Highland, near their kiosk next to the Hollywood Wax Museum.
So far, tour operators from both companies say the competition between the blue- and yellow-shirted workers remains friendly because this summer tourist season has generated enough customers for both companies. But the competition could heat up in the fall and winter, when tourists on Hollywood Boulevard become scarce.
“We always welcome competition,” said Starline’s Ritter. “But we’ve been in the city longer.”
Starline got its start in 1968, when engineering student Vahid Sapir bought a small tour company from Bud Delp, a former chauffeur for theater entrepreneur Sid Grauman. Sapir changed the company name from Bud’s Limousines to Starline Tours and, over the years, expanded it to 80 tour buses and 120 long-haul charter buses.
CitySights is owned by Twin America, a New York bus company that also operates the city’s two biggest tour bus operations, CitySights NY and Grayline Tours.
In Hollywood, CitySights’ tours are about $6 to $10 cheaper than Starline tours, but CitySights offers only three routes. Starline sells more than 40 different tours and packages, including a new crime scene tour and a tour of “secret celebrity hotspots,” designed by the producers of the celebrity gossip show TMZ.
The main Hollywood tours for both companies swing past many of the same sights, including the Chateau Marmont hotel, where actor John Belushi died of a drug overdose; the Whiskey a Go Go, where the Doors worked as the house band in the 1960s; and the Regent Beverly Wilshire Hotel, where scenes from the 1990 film “Pretty Woman” were filmed.
CitySights does not offer tours of celebrity homes because the company’s double-decker buses are not allowed on the residential streets of Hollywood and Beverly Hills. Starline, however, operates several small, open-top vans that tour the homes of the rich and famous.
A Los Angeles courtroom is about to become a venue for Wall Street’s dirty laundry.
In a trial expected to be closely watched by the financial industry, L.A. money management giant TCW Group is suing its former chief investment officer, Jeffrey Gundlach, alleging that he and his aides conspired to steal massive amounts of TCW proprietary information in 2009 to set up a rival firm.
Gundlach, a star bond fund manager, has denied TCW’s allegations and has countersued. The 51-year-old math whiz accuses his former employer of firing him to cheat him out of a huge chunk of promised income.
The civil case, set to begin Monday in Los Angeles County Superior Court and take at least five weeks, has many of the ingredients of a Shakespearean tragedy: outsized egos, frustrated ambition, a hero’s fall from grace, betrayal and revenge.
The trial essentially will require a jury to decide which of two very well-heeled parties is lying and should fork over hundreds of millions of dollars in damages to the other.
The potential spoils in the case also include the $13 billion in assets that Gundlach has attracted in just 19 months on his own.
Most of that money has come from individual investors and financial advisors who were willing to take a chance on Gundlach’s new mutual funds despite TCW’s legal onslaught against him — including allegations that he kept hard-core pornography in his TCW offices.
Investors’ faith in Gundlach has been rewarded: The flagship mutual fund he launched in April 2010, DoubleLine Total Return Bond, has gained 12.5% over the last 12 months, beating virtually all of its peer funds, including the ones he left behind at TCW.
Clients’ assets with Gundlach aren’t in danger, but a victory for TCW in the case could make it difficult for him and his firm, DoubleLine Capital, to hold on to current investors and attract more.
For TCW, which manages about $120 billion, losing the case could mean the company would have to pay substantial additional compensation to Gundlach, who earned $134 million from 2005 to 2009 alone.
Typically, corporate legal disputes like these are settled quietly, rather than litigated, to avoid reputational damage to both sides.
“They should find a way to make this thing go away,” said Kurt Brouwer, head of financial advisor Brouwer Janachowski, which manages $1 billion for clients. The Tiburon, Calif., firm has about $90 million invested with Gundlach.
But this battle has become extraordinarily vicious, even by Wall Street’s cut-throat standards.
On one side is Gundlach, who in his 24 years at TCW mastered the complexities of mortgage-backed bonds and deftly navigated TCW’s flagship bond mutual fund, TCW Total Return Bond, through the housing crash. The portfolio beat nearly all of its peer funds in the five years that ended in 2009, gaining an average of 7.1% a year.
Gundlach, who declined to be interviewed for this story, has never been shy about acknowledging his own brilliance. In managing money, he told The Times in 2009, “I’m very capable and confident in looking at the facts and analyzing them. I come to a conclusion, and 70% of the time when it comes to investment ideas it seems to be right. And 70% of the time is a money machine.”
His stellar record directing bond portfolios brought tens of billions of dollars to TCW from institutional and individual clients. His staff came to refer to him as “the Pope” and “the Godfather.”
On the other side are TCW’s strong-willed founder and chairman, Robert A. Day, and the firm’s chief executive, Marc Stern.
The 67-year-old Day, once a mentor to Gundlach, is the scion of two blue-blood L.A families, the Days and the Kecks. He launched TCW as Trust Co. of the West in 1971 and sold a majority stake in the company to French banking titan Societe Generale in 2001.
New Jersey-born Stern, 66, a lawyer by training and one of Day’s longtime deputies at TCW, is a major figure on the arts scene; he chairs the L.A. Opera.
The trial also will pit two of L.A’s premier law firms head to head: Quinn Emanuel Urquhart Sullivan for TCW and Munger Tolles Olson for Gundlach.
General Electric Co. said Friday that earnings grew 21 percent in the second quarter as its GE Capital lending arm continued to recover from the recession.
The industrial and financial giant reported income of $3.76 billion, or 35 cents per share, for the three months ended June 30. That compares with $3.11 billion, or 28 cents per share, for the same part of last year.
Revenue fell 4 percent to $35.6 billion, in part because of GE’s sale of a majority stake in NBC Universal to Comcast in February.
GE’s results beat Wall Street estimates for 32 cents per share on revenue of $34.7 billion, according to FactSet.
GE Capital more than doubled its profit to $1.66 billion during the quarter. The earnings growth signals a continuing rebound for the lending business. After booking billions of dollars in losses and impairments during the recession, GE Capital has been shedding assets. And the commercial real estate market overall has been slowly improving as the U.S. economy gradually recovers.
“We continue to see strong demand for credit,” GE Chairman and CEO Jeff Immelt said. Income at GE’s consumer and commercial lending businesses grew 57 percent and 100 percent, respectively.
The Fairfield, Connecticut, company also said that revenue growth was especially strong internationally; including India, China, Southeast Asia, Africa, Russia, Australia, Canada and Latin America.
GE’s locomotive business soared from April to June with profits jumping nearly sevenfold to $178 million.
The company’s industrial business posted modest results compared with smaller rivals. Medical and industrial instruments maker Danaher Corp.’s earnings jumped 74 percent in the second quarter while United Technologies posted a 19 percent jump in its second-quarter profit.
GE’s aviation business recorded a 9 percent increase in earnings, and its health care business increased profits 8 percent. Profits dropped, however, at GE’s energy infrastructure business by 19 percent as prices slumped for wind turbines and other renewable energy equipment.
The company has been aggressively expanding its energy business with a string of deals during the last nine months that are worth about $11 billion. GE plans to buy Converteam, Dresser Inc., Wellstream Holdings, Lineage Power Holdings and the well-support business of John Wood Group.
“We are optimistic about our growth prospects in the second half and beyond,” Immelt said.
Shares rose 39 cents to $19.55 in premarket trading.
When AEG executives signed the final documents to take over the Millennium Dome in London, giggles could be heard in the adjacent room.
The 860,000-square-foot entertainment dome was regarded as something of a national joke that had soaked up $1 billion in British taxpayers’ money and was mothballed before the Los Angeles-based venue operator showed up with an offer.
“It was like they couldn’t believe these silly Americans were dumb enough to do this,” Anschutz Entertainment Group chief Tim Leiweke recalled.
Ten years later, it’s AEG that’s laughing.
After a half-billion-dollar makeover that included an 11-screen cinema, a museum and two concert halls, plus a new name — The O2, thanks to a sponsorship deal with the British telecommunications giant — the London venue became the world’s most popular concert stage in 2009 and 2010, by number of tickets sold.
The O2 metamorphosis, AEG boosters say, is just one example of the global firm’s aptitude for spotting, shaping and selling risky projects. The company is leaning on that record to pull off what Leiweke characterizes as AEG’s riskiest project yet: a $1.35-billion football stadium in downtown Los Angeles.
That proposal is fraught with uncertainty. Assuming early City Hall political support holds through talks on a development deal, AEG would have to win over an NFL franchise, probably by persuading an existing team to move here.
It would build “Farmers Field” on public land by moving the west wing of the Los Angeles Convention Center, using nearly $300 million borrowed by the city. Knowing the city is financially strapped, the company has promised to pay for all stadium work and any shortfall in tax revenue needed to pay for rebuilding the Convention Center.
Mayor Antonio Villaraigosa backs the idea, and city analysts have spent weeks negotiating a detailed deal framework, which is expected to be released next week. Leiweke recently warned that he might call off the stadium project if the City Council does not pass a preliminary deal before members take August vacations.
One skeptic is Greg Nelson, who was chief of staff to then-Los Angeles Councilman Joel Wachs when AEG was negotiating to build downtown’s Staples Center. He said stadium proposals often overstate their economic value to a city and understate the cost to taxpayers — yet developers are able to tap the “incredible emotional appeal” of sports.
AEG, Nelson said, is especially good at that. “They are master co-opters. They understand how to push the buttons of elected officials — and what it takes to get their support…. They hire the best political consultants and lobbyists who can tell them what it’s going to take. It doesn’t make them [different] than anyone else, except they seem to be doing it much better and much more.”
Since AEG was formed to build Staples Center in 1995, the company has undergone a world-encompassing transformation. By repeatedly finding underappreciated properties, rallying public subsidies and gaining corporate sponsorships to minimize its own exposure, it has ballooned into a $10-billion entertainment and real estate powerhouse.
Privately financed by Philip Anschutz, a reclusive Denver billionaire, the company now owns or manages 100 venues around the globe. There are arenas from Charlotte, N.C., to Sydney, Australia, to Shanghai, and theaters and clubs on the Las Vegas strip and in Times Square. Six convention centers stand in Australia, Malaysia, Oman and Qatar. And four stadiums host soccer, football and rugby in Carson; East Hartford, Conn.; Stockholm; and Brisbane, Australia.
Like an oil driller that discovers crude and then ships, refines and pumps it from affiliated stations, AEG has achieved part of its success by offering a vertically integrated menu unique to its industry. It can develop and operate an arena like Staples, then assure it has something to present by booking the acts and owning the teams that play inside. In Los Angeles alone, AEG holds all or part of the Kings, the Galaxy and the Lakers.
Its concert wing produced 4,500 performances last year, including tours by Bon Jovi, Taylor Swift and the Black Eyed Peas, making it the nation’s second-largest promoter, after Live Nation Entertainment Inc. And 49 other divisions combine to push merchandise, stream videos and stage Hollywood galas.
The company’s front man has always been Leiweke, 54, a charismatic rainmaker who doesn’t have a business degree or even a college diploma — he left school after a year in a Denver junior college. What he does have, admirers say, is a salesman’s touch with key stakeholders.
From the day it launched its $350-million Staples construction — with a $71-million boost from City Hall — the company has been skilled at figuring out what public officials care about and then tailoring projects to meet those needs.
In Portland, Ore., a city famous for its environmentalism, AEG made sure the revamped Rose Garden arena secured a coveted gold rating from the U.S. Green Building Council. In addition to providing energy-efficient heating and air conditioning, AEG encourages spectators to compost their unfinished hotdog buns and popcorn.
When the issue has been feeding the public coffers, AEG has been accommodating there, too. In return for $276 million in public financing for the Sprint Center in Kansas City, Mo., the company agreed to share arena profits above 16%, netting the city about $2 million a year. The O2 agreement in London calls for the United Kingdom to get 15% of net profits for 25 years; in 2009, the venue reported after-tax income of about $20 million.
The most far-reaching overhaul of financial regulations since the Great Depression reached its first birthday with fresh criticism of its effectiveness and a new attack on one of its major reforms.
Republicans and industry groups have used the occasion to lambast the law for what they call dangerous government overreaching. Not only has it failed to heal the economy, they said, but it has added to the uncertainty that has kept businesses from hiring more people.
“It has turned the financial regulatory landscape into a nightmare,” Sen. Richard Shelby (R-Ala.), a leading critic of the Dodd-Frank Wall Street Reform and Consumer Protection Act, lectured top regulators at a Senate hearing Thursday. “I don’t believe … that the American people are in any mood to celebrate just yet.”
Obama administration officials and regulators defended the rules as necessary to prevent another financial crisis. But they also used the anniversary this week to decry the continued opposition on Capitol Hill and Wall Street that they said had slowed implementation of hundreds of new rules designed to protect the economy.
The Republican-controlled House, for example, voted 241-173 Thursday night largely along party lines to weaken the power of the law’s centerpiece, the new agency to protect consumers in the financial marketplace.
A vote is largely symbolic given strong opposition in the Democratic-controlled Senate and by President Obama. But the move demonstrated the continued contentiousness over the government’s response to the financial crisis and attempts to prevent a repeat.
“We must not lose sight of the reason that we began this process: ensuring that events like those of 2008 and 2009 are not repeated,” Federal Reserve Chairman Ben S. Bernanke warned senators Thursday about the financial overhaul. “Our long-term economic health requires that we do everything possible to achieve that goal.”
The Dodd-Frank law, which Republicans almost unanimously opposed, enacted sweeping changes to the financial regulatory system.
In addition to creating the Consumer Financial Protection Bureau, it set up a council of regulators to monitor the financial system for major risks, gave the government the power to seize and dismantle teetering firms whose failure would threaten the economy and imposed the first major regulations of complex financial derivatives.
But a year after Obama signed the legislation, the overhaul remains under heavy attack as regulators struggle to enact its complex pieces.
Financial industry lobbyists have swarmed federal agencies, trying to slow down and reduce the effect of new regulations being drawn up. And House Republicans have proposed cutting the budgets of two key regulators that depend on congressional appropriations — the Securities and Exchange Commission and the Commodity Futures Trading Commission.
The heads of those agencies complained Thursday that they don’t have enough money to implement all the new rules.
“Without sufficient funds, there will be fewer cops on the beat, but also we won’t really even have enough staff to answer the basic questions from market participants and the public on the new rules,” CFTC Chairman Gary Gensler told the Senate Banking Committee.
Despite the increased regulatory workload, the House Appropriations Committee voted in May to cut the CFTC’s budget by $30 million in 2012 to $172 million — $136 million less than Obama requested.
The committee voted a month later to freeze the SEC’s 2012 budget at $1.2 billion. Members rejected the White House’s proposed $222-million increase, even though the SEC estimated that it would collect $1.4 billion in fees next year from companies it regulates.
SEC Chairwoman Mary Schapiro said the agency would have to cut $10 million from its information technology budget, a major blow after it struggled to analyze last year’s Wall Street flash crash.
Sen. Shelby pointed out that the solution to most crises has been to give regulators more resources, but he said that simply increases bureaucracy without preventing future problems.
Republicans have taken sharp aim at the new consumer agency, which officially opened for business Thursday. They charged that the agency, with its single appointed director and broad mandate to police financial products, was too powerful.
“I wouldn’t want George Washington, I wouldn’t want Abraham Lincoln, I wouldn’t want Mother Teresa to have that kind of power,” said Rep. Spencer Bachus (R-Ala.), chairman of the House Financial Services Committee.
Still, House Republicans said they weren’t trying to kill the consumer agency or undermine the financial overhaul.
Their bill would replace the director with a bipartisan, five-member commission, make it easier for other financial regulators to veto its actions and delay the use of its authority until its leadership is confirmed by the Senate.
Democrats contended that the legislation was part of a sustained assault on the financial overhaul.
“Republicans want to delay, de-fund and dismantle the Dodd-Frank law,” Rep. Marcia L. Fudge (D-Ohio) said.
jim.puzzanghera@latimes.com
If Captain America is going to be a box-office hero, he’ll have to transcend his patriotic namesake.
Like most big-budget summer event films, “Captain America: The First Avenger” must rake in a significant amount of money around the world to turn a profit. Financier Marvel Entertainment, owned by Walt Disney Co., and the movie’s distributor, Paramount Pictures, collectively have about $300 million in production and advertising costs on the line.
But a big screen adaptation of a comic created in 1941 about a sickly young man blocked from enlisting in the U.S. Army during World War II who takes an experimental serum and is turned into a super soldier is not an obvious sell to foreign ticket buyers. Most of the studios’ big global blockbusters like “Harry Potter and The Deathly Hallows — Part 2″ and “Pirates of the Caribbean: On Stranger Tides” aren’t rooted in American culture.
“There’s no question that our gut reaction was that this movie would play better in the U.S.,” said Paramount Vice Chairman Rob Moore.
But after differentiating the film’s marketing campaign for domestic and international audiences, and with the growing worldwide appeal of Marvel’s superhero brand, the studio’s expectations have changed.
Pre-release polling indicates that “Captain America” could perform about as well as Paramount’s May release of the Marvel superhero movie “Thor,” which has grossed $180 million in the U.S. and Canada and $265 million overseas.
The total results won’t be in until the end of summer. “Captain America” opens Friday domestically and in Italy. It will roll out in the rest of the world over the next month.
“There are differences in the marketing…I’m OK with that if it will get more people in to see the movie,” said director Joe Johnston. “The film itself is exactly the same.”
Paramount, which is handling the film’s worldwide marketing, has pushed the patriotism angle in the U.S. Commercials carry taglines including “Heroes are made in America” and “America’s first Avenger.” Early screenings to build buzz were held on military bases, including Camp Pendleton in California and Andrews Air Force Base in Maryland.
At the Hollywood premiere Tuesday night at Disney’s El Capitan Theatre, the traditional red carpet was colored red, white and blue.
But foreign moviegoers watching trailers and advertisements will have to pay closer attention to pick up on which war star Chris Evans’ title character is fighting in and for what side. The marketing instead centers on the superhero’s inspirational story, as well as his battle against Red Skull, a former Nazi officer who has gone rogue with his plan for world domination.
“Overseas we focus on an evil element trying to rule the world that’s not World War II-specific, while in the U.S. it’s the flip and much more patriotic,” said Moore. “However what’s consistent in both is the universal, relatable concept of a guy with a great heart but physical limitations who is able to become a hero.”
Paramount has experience selling movies based on gung-ho American characters. In 2009 the Viacom Inc. owned studio made a concerted effort to turn “G.I Joe” into a global action property. The movie ended up grossing about $150 million both domestically and internationally.
The studio has higher hopes for “Captain America.” Moore noted that Marvel-produced movies have been growing in popularity overseas, with “Thor” the first to take in more internationally than domestically.
As with “G.I. Joe,” Paramount conducted research around the world to determine what the name Captain America meant to foreign moviegoers. It concluded that Marvel’s comics had established a base level of awareness in many countries and either positive or neutral feelings about the character.
The exceptions were Russia, South Korea and Ukraine, where research indicated awareness of Captain America was practically nonexistent. As a result, the movie’s main character isn’t named in the title in those nations. It’s known simply as “The First Avenger.”
In part to boost the movie’s foreign appeal, it’s known in the rest of the world as “Captain America: The First Avenger.” That title is meant to connect the movie to previous hits “Thor” and “Iron Man” and build on budding excitement for next year’s “Avengers” film that teams them all together.
ben.fritz@latimes.com
Times staff writer Amy Kaufman contributed to this report.
When we last checked in with CVS, the drugstore giant acknowledged that its rewards program for customers wasn’t working as intended and said a major fix was in the works.
Specifically, CVS’ chief marketing officer, Rob Price, told me the company was planning to do away with the practice of including cash-back rewards on people’s receipts, requiring you to schlep a yard-long slip of paper around with you until your next visit to the store.
Photo: CVS backs off from a more customer-friendly rewards practice
Instead, Price said, CVS had “a militia of technical people” working on a system that would store cash-back rewards on people’s ExtraCare cards, making it much more convenient for customers to enjoy the benefits of the loyalty program.
So a year has passed since that laudable news. And what do you know? I stopped by a CVS branch the other day and once again found my reward bucks printed on a yard-long receipt.
Was the company just blowing smoke when it pledged all those months ago that things were changing?
CVS now says I must have misunderstood Price when he said that “the receipt won’t be the currency going forward” and that “the goal is to have the reward stored in the customer’s card.”
Helena Foulkes, who oversees marketing for CVS Caremark, the drugstore chain’s parent company, told me the other day that CVS in fact isn’t working on doing away with printing rewards on receipts and the goal isn’t to store rewards in people’s cards.
“When you give rewards, you want people to feel excited,” she said. “You want them to know that they’ve earned the reward.”
This sense of excitement, Foulkes said, is achieved by handing customers something tangible — in this case, a receipt with their “Extra Bucks” printed on it — and requiring them to hand the receipt back the next time they purchase something.
“This makes people ‘feel the reward,’ ” she said.
That may be. But it also seems like a decidedly inconvenient way of rewarding loyal customers and a sure way of guaranteeing that relatively few people enjoy the benefits they’re entitled to.
Au contraire, said Foulkes. She said CVS’ data show that about half the 67 million customers enrolled in the Extra Bucks program happily carry around their receipts to redeem their rewards.
“That’s a number we’re really proud of,” Foulkes said.
They should be, considering that the industry average for coupon redemption is closer to 3%.
All I know is that when I stopped by a CVS store in downtown Los Angeles, most of the dozen or so people I met said they seldom remembered to keep their receipts on hand.
“I never use it,” said Koshawn Holt, 37, of South L.A. “The receipt always gets thrown away.”
Not always. Compton resident Angie Stovall, 48, showed me how she diligently wraps her receipt around her CVS card so it’s ready to go the next time she shops at the store.
But most others I spoke with said it’s too much hassle keeping track of receipts when you might not return to CVS for weeks at a time. And every single person I met, including those who routinely kept their receipts, said it definitely would be more convenient if CVS would just store the rewards on their card.
CVS gives customers 2% back on purchases every time they flash their rewards card at the cash register. You’ll also earn one Extra Buck for every two prescriptions you fill.
“We’re constantly working to make the program better,” CVS’ Foulkes said.
Along these lines, she said the company would soon introduce a service enabling customers to go online and select coupons they desire. By entering the number of their rewards card, the coupons can be stored in their account, awaiting their next visit to a store.
That’s good, as far as it goes, but it requires that customers be proactive in visiting the company’s website before shopping and entering data to get discounts. And it does nothing to encourage use of Extra Bucks.
Foulkes’ answer to that is a campaign CVS launched this month for customers to “stop money trashing.” In other words, the company wants people to stop throwing away those reward-laden receipts and instead put them to use.
“We want people to get the most out of their Extra Bucks,” Foulkes said.
If that’s really true, here’s the solution: Store Extra Bucks on people’s cards. Instantly, CVS’ redemption rate would soar to 100%.
What do you say? Would you prefer having reward cash stored on your plastic, or do you savor the excitement of carrying around your receipt? You can let CVS know by sending an email to extra@cvs.com. CC me as well and I’ll let you know the results.
David Lazarus’ column runs Tuesdays and Fridays. He also can be seen daily on KTLA-TV Channel 5. Send your tips or feedback to david.lazarus@latimes.com.
The Chrysler Group bailout officially ended Thursday when the Treasury Department sold off its remaining stake in the automaker, and the final tally shows the taxpayers lost $1.3 billion.
Italian automaker Fiat purchased the U.S. government’s 6% stake in Chrysler for $560 million, formally concluding the $12.5-billion bailout in 2008 and 2009, Treasury announced. Including Chrysler’s payment of loans from the Troubled Asset Relief Program, or TARP, the government received $11.2 billion of the money back.
As it has indicated before, Treasury is unlikely to recover the remaining $1.3 billion. But Tim Massad, the Treasury assistant secretary who oversees the TARP program, declared the bailout a success.
“With today’s closing, the U.S. government has exited its investment in Chrysler at least six years earlier than expected,” he said. “This is a major accomplishment and further evidence of the success of the administration’s actions to assist the US auto industry, which helped save a million jobs during the worst economic crisis since the Great Depression.”
Administration officials projected in June that the $80 billion in bailouts of Chrysler and General Motors would lose a combined $14 billion, about a third of what was originally projected when the government forced both into bankruptcy restructuring in 2009.
In May, Chrysler reported its first quarterly profit since emerging from bankruptcy in 2009.
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– Jim Puzzanghera
Photo: A Chrysler Sebring at the 2010 New York International Auto Show. Credit: Reuters
Leaders of the beleaguered Eurozone announced a massive new financial bailout package for Greece on Thursday, doubling the amount of loans already on offer to Athens to help keep it afloat and incorporating voluntary contributions from private investors.
The 17 countries that use the euro currency also agreed to broaden the resources available to other troubled economies and banks in the region in an effort to beat back a debt crisis that has threatened to spread from Greece, Ireland and Portugal to much larger economies such as Italy and Spain.
At an emergency summit in Brussels, Eurozone leaders agreed to offer an additional $157 billion in loans to help Greece pay its bills, on top of a nearly identical loan package last year.
But to make it easier for Athens to repay its debts, the interest rate is to be lowered to 3.5%, and loans that were to come due after 7½ years will now do so after 15 years and even, in some cases, up to 40 years.
In perhaps the most closely watched element of the new rescue plan, private bondholders, such as banks and mutual funds, are expected to contribute $53 billion by, for example, rolling over Greek debt on a voluntary basis and accepting lower yields.
However, even such voluntary measures by the private sector could still be viewed as losses by ratings agencies, which have warned that they might then declare Athens to be at least temporarily in partial default. That would make Greece the first developed European country to slide into default in about 60 years, a situation whose ripple effects remain to be seen.
All eyes will be on the markets Friday to see how they react to the new rescue package, which was hammered out at a hastily convened summit that many analysts characterized as a make-or-break session for the Eurozone in its attempt to rein in its galloping debt crisis.
In recent days, worries about Eurozone inaction over Greece’s economic woes have caused investors to doubt their holdings of debt belonging to Italy and Spain, driving up those countries’ borrowing costs to almost intolerable levels.
Europe’s leaders were starkly warned to act fast to stem the contagion or risk an implosion of the Eurozone and the single currency, which would have enormous global repercussions. President Obama, dealing with his own debt crisis in the U.S., urged Europe to move quickly.
“This threat had to be contained,” Herman van Rompuy, the president of the European Union, said Thursday night. “We have shown that we will not waver in the defense of our monetary union and our common currency…. When European leaders say we will do everything [that] is required to save the Eurozone, it is very simple. We mean it.”
To help debt-ridden governments such as Rome and Madrid if they run into trouble in the markets, the Eurozone leaders agreed to grant new powers to their $634-billion bailout fund, allowing it to preemptively issue temporary lines of credit.
The fund will also be authorized to shore up sickly banks when necessary, which could be crucial for Greek financial institutions if the ratings agencies declare Athens to be in partial default.
Greek Prime Minister George Papandreou said the new rescue package would help lighten the burden on his country. But he added that the new initiative was important for the region as a whole.
“This is a European success, a European package,” he said. “It’s a European response for Europe.”
henry.chu@latimes.com
California will seek $5 billion in short-term loans from banks and other financial institutions next week, hoping to avoid the risk of being locked out of the markets if Congress fails to raise the federal debt ceiling by Aug. 2.
Treasurer Bill Lockyer had planned to sell at least $5 billion in so-called revenue anticipation notes to investors in August. The state typically sells such notes at this time of year to bridge the gap between its cash needs and the arrival of tax revenue later in the fiscal year.
But Lockyer’s office said Thursday he opted to raise cash more quickly by borrowing from banks to guard against “potential financial fallout from a debt ceiling impasse.”
If the ceiling isn’t raised the U.S. Treasury has said it will be unable to pay all of its bills. That has raised the specter of a debt default, which could drive U.S. interest rates higher across the board.
Lockyer on Tuesday will seek competitive bids from commercial banks, investment banks and other financial firms for the $5 billion in loans. The debt will be repaid later when the plan to issue revenue anticipation notes is revived, the treasurer said.
He also said he could abort the bank loan plan if the White House and Congress reach an agreement on the debt ceiling before Tuesday.
In October Lockyer borrowed $6.7 billion from banks at an annualized interest rate of 1.4%. Those loans were paid off when the state sold two series of revenue anticipation notes in November. The notes that matured in May paid investors 1.5%; the series that matured in June paid 1.75%.
In recent years, California’s short-term notes have been highly popular with small investors because the tax-free yields have been lucrative compared with near-zero rates on other short-term securities.
– Tom Petruno
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Aerospace manufacturer Goodrich Corp. said Thursday its second-quarter net income rose 11 percent on sales growth for aircraft parts, driven by regional and business aviation.
The Charlotte, N.C., company also raised its earnings expectations for the year.
In the three months that ended June 30, Goodrich earned $177 million, or $1.38 per share, compared with net income of $159 million, or $1.42 per share, a year ago.
Revenue rose 17 percent to $2 billion from $1.72 billion a year ago. Revenue from original equipment for regional and business jets jumped 58 percent, the most of any category. Revenue from parts for large commercial airplanes rose 17 percent. Replacement part sales across all these categories increased 16 percent. Defense and space sales for parts and services increased 10 percent.
Analysts surveyed by FactSet Research expected a profit of $1.32 per share on sales of $1.95 billion.
The continued demand for the company’s parts, which range from landing gear to flight-control systems, led it to boost its expectations for the full year.
For all of 2011, Goodrich now expects to earn between $5.85 and $6 per share on revenue of $8.1 billion. It previously forecast earnings of $5.40 to $5.55 per share on revenue of about $7.8 billion. Analysts had previously projected $5.62 per share on revenue of $7.93 billion.
President Obama is nearing a decision to sharply increase vehicle fuel-efficiency requirements. But automakers — emboldened by a return to profitability two years after an industry bailout — are pushing hard for concessions that would reduce energy savings in the next generation of cars and trucks.
The companies are also calling for a review several years down the road that would potentially reopen the bargaining, which environmentalists say could enable the industry to drag its feet and eventually meet lower standards.
The most ambitious proposal on the table calls for the American car and truck fleet to average 56 miles per gallon by 2025. Although the industry has not publicly offered a counterproposal, it is believed to be seeking average mpg standards in the low- to mid-40s.
To increase pressure on Obama, a radio advertising blitz in seven politically important states is scheduled to start Thursday featuring warnings against overzealous government regulation and the threat of worker layoffs. The Alliance of Automobile Manufacturers will begin airing 60-second radio ads in the District of Columbia, Michigan, Ohio, Indiana, Illinois, Pennsylvania, North Carolina and Missouri.
“Families would be hit with higher car prices,” the ads say. “Small businesses dependent on vans, SUVs or pickups would face limited vehicle choice.”
At issue in the negotiations between the White House and automakers, led by Detroit’s Big Three — General Motors, Ford and Chrysler — are fuel-efficiency standards for cars and light trucks to be built starting in 2017. In addition to arguing that Obama wants to increase standards too much, manufacturers reportedly want to continue to have less demanding standards for light trucks, SUVs, minivans and full-size trucks.
Federal standards apply to a manufacturer’s entire output, not to each individual vehicle. Makers can continue to produce less efficient vehicles but must ensure they sell enough of the more efficient units to make the total fleet average meet the overall fuel standard.
Industry resistance comes after a period of relative accord. In May 2009, chief executives of the nation’s car companies stood with Obama in the White House Rose Garden in an unprecedented show of unity over raising fuel efficiency to about 34 miles per gallon by 2016.
What’s changed is part politics and part economics.
Automakers are worried about being saddled with tough efficiency standards that might leave them out of step with consumer preferences. Despite the increasing popularity of fuel-efficient cars, the top-selling vehicles in America remain gas-hungry trucks. The industry says sharply higher standards could lead to layoffs, price increases of up to $10,000 per vehicle, diminished safety and the demise of some vehicle lines.
“You get into trouble when consumers want to buy one thing and what the fuel-efficiency standard said is to make another thing,” said Jeremy Anwyl, chief executive of auto information company Edmunds.com.
But some industry analysts said the long lead time of the proposed new standards would give carmakers plenty of time to comply, that innovative new vehicles could boost their profits and savings on gas would help offset higher car prices for consumers. The United Auto Workers union, which for years echoed car companies’ assertions that tough mileage standards would destroy jobs, now sees fuel-efficient vehicles as a way to keep factories open.
“President Obama saved the auto industry. He doesn’t want to jeopardize that,” UAW President Bob King said. “To direct this kind of criticism at the administration after what they’ve done is irresponsible.”
The White House declined to comment on the negotiations, which include car companies, the state of California and other stakeholders, saying only that they are “constructive.”
neela.banerjee@latimes.com
More people applied for unemployment benefits last week, evidence that layoffs are rising and the job market is weak.
Applications for unemployment benefits rose by 10,000 to a seasonally adjusted 418,000, the Labor Department said Thursday. The four-week average, a less volatile measure, dipped to 421,250.
Applications have topped 400,000 for 15 straight weeks, a sign of sluggish hiring. Applications had fallen in February to 375,000, a level that signals healthy job growth. They stayed below 400,000 for two months. But applications surged to an eight-month high of 478,000 in April and have declined slowly since then.
Consumers have pulled back on spending this year, besieged by high unemployment, stagnant wages, and high gas prices. That has slowed growth.
Unemployment applications “remain stubbornly elevated,” said Yelena Shulyatyeva, U.S. economist at BNP Paribas. “A lot of structural factors are still affecting the economy,” she added, such as the weak housing market and continuing layoffs by state and local governments.
The economy expanded only 1.9 percent in the January-March quarter, and some analysts forecast even slower growth for the April-June period.
Employers have responded by cutting back sharply on hiring. The economy added only 18,000 net jobs in June, the second straight month of dismal job gains. That’s far below the average of 215,000 net jobs per month the economy averaged from February through April. The unemployment rate rose to 9.2 percent last month, the highest this year.
Some companies are cutting jobs. Cisco Systems Inc., the world’s largest maker of computer-networking gear, on Monday said that it is eliminating 6,500 positions, or about 9 percent of its worldwide work force of 73,000.
Layoffs rose to their highest level in nine months in May, according to a separate Labor department report last week.
Economists have attributed much of the slowdown to temporary factors, such as a spike in gas prices this spring. Manufacturing output also declined after Japan’s March 11 earthquake disrupted global supply chains.
Many economists expect growth to pick up later this year as those factors fade. Gas prices, for example, averaged $3.68 a gallon on Wednesday, down from their peak of nearly $4 in early May.
But concerns are also rising that the economy’s weakness will persist. Goldman Sachs has cut its estimate for growth in the July-September period to 2.5 percent, down from an earlier estimate of 3.25 percent. Also last week, JPMorgan reduced its estimate to 2.5 percent from 3 percent.
Goldman Sachs cited extremely weak consumer demand as one factor behind its reduced forecast. Goldman also said in a research note that it is “still unsure about the precise reasons for the slowdown” this year.
JPMorgan, meanwhile, said companies have built up large stockpiles of goods and, as a result, factories probably won’t have to produce as much in the July-September quarter.
Growth of about 2.5 percent is barely enough to reduce the unemployment rate. The economy would need to grow 5 percent for a whole year to bring down the rate by one percentage point.
The total number of people receiving unemployment benefits fell by 50,000 to fewer than 3.7 million. Millions of additional unemployed workers are also receiving aid from extended benefit programs put in place during the recession. All told, more than 7.3 million people received unemployment benefits in the week ending July 2, the most recent data available.
“American Idol” creator Simon Fuller wants credit for Fox’s new talent show “The X Factor.”
In a suit filed Wednesday in California Superior Court against Fox Broadcasting Co. and “The X Factor” producer Fremantle North America Inc., Fuller said he was promised an executive producing credit on “The X Factor,” which premieres this fall with former “American Idol” judge Simon Cowell as the star.
Fuller’s lawsuit against Fox, which also airs “American Idol,” and Fremantle is the latest twist in his complex relationship with Cowell, who was a judge not only on “American Idol” in the U.S. but also on Fuller’s British version known as “Pop Idol.” Cowell launched “The X Factor” in Britain in 2004 and quickly got tangled up in a lawsuit with Fuller, who contended that the show was a rip-off of “Pop Idol.”
The suit against Cowell was eventually settled and Fuller said that as part of that agreement he was promised an executive producing credit on Cowell’s “The X Factor” should the show be brought to the United States.
“As often happens in Hollywood, however, binding promises made one day for expediency turn out to be cast aside when it comes time to perform,” Fuller’s suit said, adding that Fox and Fremantle have made “hundreds of millions of dollars” because of Fuller’s creative efforts.
Fox and Fremantle said in a statement that Fuller’s suit is without merit and that he is seeking “payment and credit as an executive producer despite his neither having been approved by the required parties, nor hired, as such.”
In his lawsuit against Fox and Fremantle, Fuller includes an excerpt from a 2005 letter that said the network would sign off on Fuller as an executive producer with a fee that is “commensurate with his duties and stature in the entertainment industry.” It was that promise, Fuller said, that led him to end his legal fight with Cowell over the British version of “The X Factor.”
A spokesperson for Fuller said he has “prudently attempted to settle this matter privately but the other parties have refused to honor the original contract, leaving him no other choice but to pursue legal action.”
joe.flint@latimes.com
A government program that helped homeowners finance and install green upgrades before a technical roadblock stalled it last year may be resuscitated by Congress.
A group of legislators introduced a bill Wednesday to jump-start the Property Assessed Clean Energy program, known as PACE. The program made installations of energy-efficient solar panels, insulation and water conservation systems more affordable.
More than half of the country had approved some version of the program in which local governments provided funding for home improvements. Homeowners paid back the funds in installments through surcharges on their annual property taxes.
But the Federal Housing Finance Agency balked at a component of the program, saying that in case of a foreclosure on the property the PACE funds would have to be paid back before the mortgage.
The housing authority, which oversees mortgage finance giants Fannie Mae and Freddie Mac, warned last summer that PACE posed “unusual and difficult” financial risks for lenders. The lenders in turn told homeowners that participating in the program could be a violation of their mortgage terms and could be grounds for foreclosure.
Since then most governments have backed away from the program.
But the PACE Protection Act from Reps. Mike Thompson (D-St. Helena), Dan Lungren (R-Gold River) and Nan Hayworth (R-N.Y.) would force the housing finance agency to rescind its warning. To mitigate the potential risks of homeowner defaults, the trio worked in more stringent standards for PACE applicants, such as lowering the scope of green improvements relative to property size.
“We’ve tried everything to work with them, but they’re just being stubborn,” Thompson said of the housing finance agency. “It’s come down to introducing legislation, which is not the route we wanted to go.”
The agency said in a statement that it was willing to offer input on PACE-related legislation. However, it said it “continues to have concerns with the first lien created by certain PACE programs and the absence of effective consumer protections.”
The program helped create construction jobs in Sonoma County when the housing industry was free-falling elsewhere, said Thompson, who represents the region.
The nearly 2,500 PACE projects on the books helped generate income and tax revenue for municipalities — about $60,000 per home, according to a new study from advocacy group PACENow. Owners of retrofitted homes also generally had lower mortgage default rates.
“Not only do you get the lower utility rates and contributing to saving on energy costs, it’s really done wonders to put people to work,” Thompson said. “It’s a huge answer to the question of how we solve this energy problem.”
Other financing options have begun to spread as PACE struggles to find its footing.
Lease programs from installers such as SolarCity and Sun Run eliminate the upfront costs of solar panels. A company called One Block Off the Grid, which arranges group deals for solar installations and offered a Groupon special last year, announced a nationwide discount this week.
Sponsors of the new bill say the wider array of options will increase rather than hinder demand for PACE by making energy efficiency seem more affordable.
tiffany.hsu@latimes.com
Apple updated its thin-and-light MacBook Air laptops on Wednesday, alongside the much anticipated release of Mac OS X Lion, while also unceremoniously discontinuing its white entry-level MacBook line.
The new MacBook Air notebook computers, which lack optical drives (another example of Apple pushing users toward a disc-free future), gain speedier Intel processors — ranging from the 1.6GHz dual-core Core i5 chip in the lower-end 11-inch-screen model, to the dual-core 1.8GHz Core i7. The i5 and i7 processors are known for being pretty powerful, with variations of this chip line running in Apple’s MacBook Pros and iMac computers.
A backlit keyboard and a Thunderbolt port have also been added to the Airs in this refresh. Thunderbolt ports are capable of transferring data at a rate of 10 gigabits per second, much faster than USB 2.0, which transfers data at about 480 megabits per second. But, as of now, there aren’t a lot of external hard drives or cameras and other items that utilize the ports due to the cost of implementing the technology — a Thunderbolt cable itself sells for $49.
Despite the changes, the price range for the MacBook Air is staying the same; from $999 to $1,699.
And it just might be that $999 price point of the 11-inch base MacBook Air that is responsible for Apple killing off the much beloved white polycarbonate MacBook laptop. Though we don’t know for sure if that’s the reasoning — as of Tuesday morning, Apple officials weren’t available for comment on why the white MacBook is getting the axe.
Without any notice, the white MacBook (which also started at $999 and had a 13-inch screen) was yanked from Apple’s lineup and online store. Some old refurbished models of the MacBook are still available from Apple online, but new models are done.
The move to discontinue the polycarbonate MacBook will leave Apple, for the first time since 2001′s introduction of the iBook G3, without a solid-white laptop for sale. A stroll across just about any U.S. college campus in the last decade was a testament to the massive popularity of Apple’s entry-level laptops, which makes this move a bit surprising.
But if Apple no longer sees a need for disc drives in its entry level notebooks, which the MacBook Air now seems to be, the MacBook must have made a lot less sense to Steve Jobs and other Cupertino execs. Now, every Apple laptop (and desktop for that matter) is clad in silver aluminum.
Those looking at a laptop and also wanting a disc drive can either pair a MacBook Air with a portable disc drive for an extra $79, buy a pricier MacBook Pro laptop, or look to one of the many Apple competitors.
RELATED:
Apple releases Mac OS X Lion, $29.99 in Mac App Store
Apple sells more iPhones, iPads than ever in record quarter
Apple’s App Store passes 15 billion downloads, 425,000 apps available
– Nathan Olivarez-Giles
Images: At top, Apple’s MacBook Air laptop and, at bottom, the discontinued MacBook laptop. Credit: Apple
The federal government is unwrapping its most potent weapon yet in the battle to keep businesses from defrauding consumers: a powerful new agency designed to police nearly every type of transaction in hopes of avoiding another financial crisis.
The Consumer Financial Protection Bureau, opening Thursday, is the first major agency launched in Washington in nearly a decade and the first since the early 1970s that is specifically focused on American consumers.
Its controversial creation — still opposed by most Republicans and much of the financial industry — is the culmination of years of efforts by consumer advocates to get the government to play a greater role in overseeing credit cards, mortgages and other financial products.
“For consumer protection, this is really the biggest and most important change that’s occurred for several decades,” said Willard Ogburn, longtime executive director of the National Consumer Law Center.
Advocacy group Consumers Union on Wednesday released results of a recent poll showing that 74% of respondents supported the new bureau.
Reza Daniali, for one, hopes the new agency can prevent cases like his. He nearly lost his three-bedroom house in Victorville because of a confusing adjustable-rate mortgage he took out in 2005 that eventually had him paying nearly 12% interest — more than double the average rates for the last year or so.
“I’m partially to blame for not informing myself, but the loan was really awful,” said Daniali, 30, a pool service business owner who recently received reduced monthly payments through a federal program. “Somebody needs to be watching these banks because you’re powerless over them.”
Some consumers are concerned that the agency’s staff, now at 400 and expected to triple to 1,225 by the fall of 2012 as it continues to ramp up, will get overwhelmed after years of regulatory neglect.
“They are going to get flooded — 1,200 employees is not going to cover what’s going to come at them,” said Kim Canning, 44, of Parker, Colo. She has been fighting for nearly two years to save her three-bedroom ranch from foreclosure after banks botched her refinancing.
“It is like I’m in a black hole. Nobody will help. My credit’s been destroyed, although I still pay my mortgage,” she said. “It’s about time at a national-level something like this is coming into place because this is just ridiculous.”
The agency, the centerpiece of the financial regulatory overhaul enacted last year, bills itself as a new cop on the beat in the financial marketplace. In a video on its website, http://www.consumerfinance.gov,Elizabeth Warren, the Obama administration advisor who has been working since September to launch the bureau. She said about a quarter of its budget would go to responding to consumer complaints.
Warren said the agency would use new technologies to analyze consumer complaints and quickly focus on problems. And it is developing a high-tech infrastructure to process consumer complaints and funnel them to financial institutions for action.
The first step starts Thursday as the agency’s consumer response center for credit card problems begins operations. The center will integrate phone and online complaints and will expand its reach to other products, including mortgages and student loans.
Warren cautioned that it would take time for the bureau to have an effect.
“The way to make big change in a marketplace is not with a single blow. It’s with thousands of small pushes in the same direction,” she said. “For us, the same direction is toward making the price clear, making the risk clear and making it easier to compare products.”
The agency’s first major initiative, already underway, is to merge two complicated mortgage disclosure forms that lenders must give home buyers into a single, easier-to-understand form.
The consumer bureau opens for business after a rocky year of preparations. It is still without a Senate-confirmed director — and therefore, under the law, unable to use all the power that Congress granted it.
It’s going to cost more to buy electric cars in California.
The state has run out of the $5,000 rebates it was giving people who purchased all-electric vehicles such as the Nissan Leaf and Tesla Roadster.
That’s on top of a price increase for the Nissan Leaf. The automaker said this week that it would raise the price of the base model when the 2012 cars come out this fall by $2,420 to $36,050, including destination charge. The higher-trim-level Leaf SL will go up $3,530 to $38,100, including destination charge.
But there could be some relief for those who were on the waiting list for the $5,000 rebate. The state’s Air Resources Board on Thursday will consider a recommendation to provide rebates of $2,500 to about 500 people who have already purchased cars and who were on the waiting list.
The vote would provide additional funds for about 5,500 rebates — also $2,500 — for electric cars and some other types of zero-emission vehicles such as the hydrogen vehicles that some automakers offer through experimental lease programs, said Mary Fricke, spokeswoman for the Air Resources Board.
None of this affects the $7,500 federal tax credit used to spur sales of electric vehicles and plug-in hybrids, such as the Chevrolet Volt. The Volt doesn’t qualify for the state rebate, though emission-control upgrades to the vehicles expected sometime next year could put it on the list.
The rebates are intended to promote the production and use of zero-emission vehicles, known as ZEVs, which include electric, plug-in hybrid electric and fuel-cell vehicles.
“The government is saying that if you are an early adopter, be prepared to pay for it,” said Jesse Toprak, an analyst at auto information website TrueCar. He said there’s enough demand for electric vehicles to absorb some price increases and shrinking rebates, at least for the next year or so.
It’s not a surprise that the California rebates are shrinking, said Brian Wynne, president of the Electric Drive Transportation Assn.
“The California rebate already has been a particularly generous incentive,” Wynne said.
Though incentives are helpful to increasing sales, the electric-car industry has to get to the point where its vehicles are competitive with traditional internal-combustion-engine cars, he said. That will require production in greater volume and price decreases for batteries and other components.
Nonfinancial incentives, such as carpool-lane permits for electric vehicles, can be just as important to increase sales as dollars from the government, especially in regions such as California that are known for traffic congestion, Wynne said.
The number of electric-car offerings is about to grow. Other automakers have battery-electric and plug-in offerings set to hit dealerships in the next 18 months, including the Mitsubishi iMiEV, the Ford Focus Electric, the Toyota Prius plug-in hybrid, the Toyota RAV4 electric, the Honda Fit EV and a plug-in hybrid version of the Honda Fit.
As for the Nissan Leaf, the automaker said it was making some changes as part of its price increase. It is adding cold-weather features such as a battery warmer, a heated steering wheel and heated front and back seats to both trim levels. The SL model also gets a fast-charging port that works with a 480-volt outlet to charge the car in 30 minutes, compared with eight hours using a 220-volt outlet. Previously, that was a $700 option.
Nissan also is gearing up Leaf production. It is investing about $1.7 billion — mostly from federal Department of Energy loans — in an electric-car battery factory and other upgrades at its massive factory complex in Smyrna, Tenn. It plans to start building the batteries and cars at the factory by the end of 2012.
On Wednesday, Nissan said it would produce the electric motor for the Leaf starting in early 2013 at its Decherd, Tenn., powertrain assembly plant. The factory will add about 90 jobs and will have the capacity to produce up to 150,000 electric motors annually for the Leaf, which will be built in Smyrna.
Nissan has sold 4,134 of the battery-powered electric cars this year. General Motors Co.’s Chevrolet, by comparison, has sold 2,745 of its Volt car, which is technically a plug-in hybrid because it runs on electricity for about 40 miles before a gasoline-fueled generator kicks in to extend the vehicle’s range. Chevrolet also is ramping up Volt production.
jerry.hirsch@latimes.com
Products get knocked off all the time — designer bags, Oscar-night dresses, watches. But entire stores? That’s something new. Which is why the Internet is going crazy over a blogger’s report that three fake Apple stores have popped up in her neighborhood in Kunming, China.
In a post dated Wednesday on the blog BirdAbroad, the citizen reporter (an employee of an international public health organization) said she was initially duped by the quality of the fake Apple store. It had the iconic clean wood interior, the Apple branded posters on the walls, the employees with those tell-tale blue polo shirts and chunky name tags hanging around their necks. The store appeared to sell real Apple products.
Her husband bet it was a fake, she bet it wasn’t. When they got home they looked online and found that Apple doesn’t have any stores in Kunming. A few days later she walked down the street and bumped into two more Apple store knock-offs!
In retrospect, she writes, some things felt off in the store. The stairs were poorly constructed and the name tags didn’t have actual names on them, just the word “staff.” She also notes the walls weren’t painted correctly, and the sign in front was wrong:
“Apple never writes ‘Apple Store’ on it’s signs – it just puts up the glowing, iconic fruit,” she wrote.
BirdAbroad, who does not use her real name on her blog and asked that we not use it either, had to do some fancy maneuvering to be allowed to take photos in the store.
“I … may or may not have told them that we were two American Apple employees visiting China and checking out the local stores. Either way, they got friendlier and allowed me to snap some pictures,” she wrote.
She also said the employees definitely believed they were working for the real Apple company.
Citizen journalism lives!
Apple updates the MacBook Air, axes the white MacBook
Apple releases Mac OS X Lion, $29.99 in Mac App Store
Anonymous plans AnonPlus after being kicked out of Google+
–Deborah Netburn
PS: If you have some time on your hands — like more than five minutes — I suggest reading this 2007 story on the rise of the real Apple Store by feature writing great Hank Stuever.
Photos: Inside a faux Apple Store. Credit: BirdAbroad
Imagine Batman and the Joker are interested in fractional ownership of the same pickup truck. The caped crusader would want it all-black, eminently capable of off-roading, with a penchant for getting airborne. His nemesis might favor it in a crazy shade of orange, with a maniacal engine under the hood and an anarchists’ disregard for fuel economy.
The truck would be order and chaos fused together. Yin and yang.
Photos: 2011 Ford Raptor
Photo: Ford’s F-150 SVT Raptor is an elegant off-road dominator
It would be the 2011 Ford F-150 SVT Raptor.
Based on the F-150, a truck that’s been the most popular vehicle in the U.S. for decades, the Raptor package adds a whole mess of menace and off-road accoutrement. The result is something you can take from the dealership straight to your torture chamber of choosing (be it rock, sand or mud) without making any modifications.
This is because the upgrades have been made for you, by Ford’s Special Vehicle Team.
The group started the transformation from mild-mannered F-150 to havoc-wrecking Raptor by dropping into it Ford’s largest regular-duty V-8. This 6.2-liter leviathan produces 411 horsepower and 434 pound-feet of torque and is paired with a six-speed automatic transmission with a tow mode and manual shifting.
The Raptor’s predilection for getting dirty is further enhanced with off-road goodies such as an electronic locking rear differential for added traction, a hill descent control system and an electronic four-wheel-drive system. Towing capacity is rated at 8,000 pounds.
This Ford also has a dedicated off-road mode that changes the throttle response, delays the transmission’s shifting and gets more liberal with the traction control.
Perhaps the most conspicuous change the Raptor package makes to the standard F-150 is the heavy-duty suspension and tire setup. Rather than develop the suspension in-house, Ford turned to Fox Racing Shox, a suspension company whose name will ring familiar to anyone who recently swung a leg over a mountain bike, snowmobile, ATV or dirt bike.
Fox developed massive shocks that give the Raptor 11.2 inches of suspension travel (the distance the shock compresses) in the front and 12.1 inches in the rear. Pair these to the 35-inch BFGoodrich tires and you have a truck that sits well over 6 feet tall.
Exterior changes from the F-150 come in the form of an all-black grille, flared fenders to accommodate the Raptor’s 7-inch-wider track and a distinctive hood, front bumper and skid plate. The color palette is limited to black, white, orange, blue and silver.
These upgrades create a truck that absolutely dominates off-road driving in a way no other stock truck can. Although the Raptor handles low-speed maneuvers with above-average competence, it’s when the Ford really gets moving that it shines.
The Ford snarls with pleasure as its suspension, tires and wide track help it float over ruts, rocks and generally any obstacle that might cause other trucks to lose their cool.
This should come as no surprise since the Raptor’s pedigree lies in Baja 1000 racing trucks.
Point the truck at a jump and floor it, and you’ll chicken out long before the Raptor does. As you soar through the air making sure your common sense is stowed and your fillings are in the upright and locked position, the Fox shocks are preparing for your landing.
A design feature enables the shocks to become progressively stiffer as they move through their travel, thereby making it difficult to bottom out the suspension. If you do, the burly skid plate is waiting to protect the truck’s nether regions.
On the road, the Raptor spews sinister intimidation like few other vehicles. Imagine looking in your rear-view mirror and seeing Gravedigger. But while piloting a truck with a presence this daunting is addictive, it’s also imperfect.
Tire noise isn’t atrocious, but this Ford’s suspension setup creates the feeling that you’re driving an oversized marshmallow. The truck leans and rolls prodigiously around corners, and steering is vague and cumbersome. The Raptor’s extra girth makes parking and navigating tight spaces a chore.
In addition, the various modifications make the Raptor heavy. Curb weight for this vehicle is 6,200 pounds, hundreds of pounds more than a standard-issue F-150. This means you’re going to need all 411 horsepower (and maybe most of your gas tank) to hit the 6.6-second zero-to-60 time that Car and Driver recorded.
This 3-ton heft also means you’ll probably end up on the low end of the Environmental Protection Agency’s fuel economy rating of 11 miles per gallon in the city and 14 mpg on the freeway. My 220 miles with the Raptor yielded an average of 11.1 mpg.
Despite the Raptor’s preference for the road less traveled, it does treat its occupants to a high level of luxury. My loaded example (in Tuxedo Black, no less) featured a Sony navigation and sound system with Sync, leather seats that are heated in the front, heated mirrors and a rear-view camera. These options added $6,355 to the Raptor SuperCrew’s $45,290 base price.
The SuperCrew is the four-door version of the Raptor, and its interior is positively cavernous; legroom for rear passengers is greater than that of a full-size Mercedes. Furthermore, a flat floor in the rear of the Raptor and seat cushions that fold up mean that when not coddling passengers, the back seating area can hold a lot of cargo.
Buyers who need less interior space can save themselves $2,765 and get the SuperCab setup, with two full doors and two smaller, rear-hinged doors. The length of the bed is the same for both Raptors, at 5.5 feet.
All Raptors include safety features such as four-wheel ABS, traction control with a rollover stability feature, six air bags, an integrated trailer brake controller and trailer sway control.
Ford’s SVT did a fine job channeling its dark side when creating the Raptor. The company has created a niche in the pickup truck market, and it should have no trouble dominating it. It is by no means a vehicle for everybody; it’s not even right for many truck buyers. But it’s right for a few.
Yes, Mr. Wayne. It’s right for you.
david.undercoffler@latimes.com
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