Toyota is planning to suspend production at two U.S. plants as sales lag following the automaker’s massive recall of its vehicles.
Mike Goss, a Toyota spokesman, said the company will retain all of its workers during the suspensions, which will take place at plants in Kentucky and Texas in the weeks ahead.
The temporary shutdowns are aimed at adjusting production levels following a series of recalls that forced Toyota to halt sales of some of its most popular models.
"We don’t want inventory to build up for our dealers," Goss said. "We can’t keep sending vehicles to dealers until they can start moving those vehicles."
He said the company has used other methods to slow production in the past, such as limiting overtime, but that "elimination days are kind of the final step in that process."
The Kentucky plant, where Toyota’s top-selling Camry is made, will not produce cars on Feb. 26. Goss said the plant could go dark on a few more days the following week, though no official plans have been made.
The Texas plant will halt production the week of March 15 and again in mid April. The plant, where Toyota makes Tundra pickup trucks, will be modified to begin producing Tacoma trucks during the suspension, Goss said.
Toyota has recalled more than 8.1 million vehicles worldwide for problems related to sudden acceleration and unresponsive break pedals, among other things. The company has apologized for the safety lapses and pledged to repair the recalled vehicles quickly.
Meanwhile, the number of customer complaints filed with federal safety regulators has spiked in recent weeks. According to the National Highway Traffic Safety Administration, there have been a total of 34 Toyota complaints alleging fatalities since 2000.
The widely publicized safety issues have taken a toll on sales. Earlier this month, Toyota said January sales fell 16% from a year earlier, worse than a forecast of a 12% year-over-year decline from sales tracker Edmunds.com.
To help revive sales, the automaker is considering a variety of incentive options aimed at drawing customers back into its showrooms.
At the same time, Toyota has launched a public relations campaign aimed at salvaging the company’s once-sterling reputation.
Toyota’s president, Akio Toyoda, and other company executives will take questions about the recall efforts Wednesday at a press conference in Tokyo.
The company has been ramping up lobbying, consulting and attorney teams ahead of appearances on Capitol Hill. Toyota is scheduled to go before two House committees next week and a Senate committee next month.
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NEW YORK — Wal-Mart Stores Inc. will cut about 11,200 jobs at Sam’s Club warehouses as it turns over the task of in-store product demonstrations to an outside marketing company.
The move is an effort to improve sales at Sam’s Club, which has underperformed the company’s namesake stores in the U.S. and abroad.
The cuts represent about 10 percent of the warehouse club operator’s 110,000 staffers across its 600 stores. That includes 10,000 workers, most of them part-timers, who offer food samples and showcase products to customers. The company also eliminated 1,200 workers who recruit new members.
Employees were told the news at mandatory meetings on Sunday morning.
"In the club channel, demo sampling events are a very important part of the experience," said Sam’s Club CEO Brian Cornell in a phone interview. "Shopper Events specializes in this area, and they can take our sampling program to the next level."
Shopper Events, based in Rogers, Ark., currently works with Wal-Mart’s namesake stores on in-store demonstrations. Sam’s Club is looking to the company to improve sampling in areas such as electronics, personal wellness products and food items to entice shoppers to spend more.
Sam’s Club has performed more poorly than Wal-Mart Stores Inc.’s namesake stores in the U.S. and abroad. Cornell has been working to improve results since taking the helm in early 2009, introducing new store formats, price cuts and offering more variety and more brands of items from take-home meals to baked goods.
As consumers eat out less in the shaky economy, Sam’s Club has tried to steal customers from grocery chains and rival warehouse stores such as Costco Wholesale Corp no fax payday loans. by offering more everyday goods such as food and health and beauty items and by paring its assortment of general merchandise such as furniture and clothes.
But in Wal-Mart Stores’ most recent quarter, revenue at the Sam’s Club division slipped nearly 1 percent to $11.55 billion while U.S. Walmart stores posted a 1.2 percent sales increase to $61.81 billion. Earlier this month, Wal-Mart Stores closed 10 underperforming Sam’s Club locations, resulting in the loss of about 1,500 jobs.
"Sam’s has been the relative laggard, and it has lagged relative to its direct competitors, Costco and the smaller BJ’s (Wholesale Club)," said Craig Johnson, president of retail consultancy Customer Growth Partners.
The move to outsource its food sampling efforts is a way for the company to tout its fresh food offerings in a cost-effective manner, Johnson said.
—"’Fresh’ is where the real competitive battles are being fought in the club sector," he said.
Shopper Events will launch a new demo program called "Tastes and Tips" with new carts, signs, uniforms and a trained team, said Cornell. He said the move was not made to save money.
"It’s not a cost-cutting measure, it’s really an investment in enhancing our demo program," he said. Cornell added that Shopper Events planned to hire "roughly the same number of people" cut, and said Sam’s Club workers are invited to apply for those positions.
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Television shopping giant QVC said Black Friday generated more than $32 million in orders - a 60 percent increase over last year’s sales.
That represents 765,000 units ordered in a 24-hour period for the shopping channel, which offers its own brand of holiday specials. Officials called its programming “the largest and most aggressive Black Friday event in the multimedia retailer’s 23-year history.” That meant lots of deals and much less talk.
QVC.com contributed 40 percent of the sales.
Top sellers included a Sylvania digital camcorder, Playhut Travel Lounger, Nintendo Wii, Olympus 5x zoom Camera.
The U.S. economic recovery will extend into next year as manufacturing expands and the pace of firings abates, reports today indicated.
The Conference Board’s index of leading indicators, a gauge of the outlook for the next three to six months, rose 0.3 percent in October, preserving a string of gains that began in April. Other reports showed claims for jobless benefits held at a 10-month low and Philadelphia-area manufacturing accelerated.
The rally in stock prices, low short-term interest rates and slowing job losses that propelled the leading index signal consumer confidence and spending are likely to stabilize, limiting the risk the economy will retrench. The data supported Treasury Secretary Timothy Geithner’s forecast today that the emerging expansion will be sustained into 2010.
“It’s very clear that the economy is now expanding, but I don’t see it being a vigorous expansion,” said Michael Moran, chief economist at Daiwa Securities America Inc. in New York, who correctly forecast the leading index. “We are seeing a gradual improvement, but the key word is ‘gradual.’”
Stocks extended a global drop as concern grew that the rally outpaced the prospects for economic growth and Bank of America Corp. downgraded chipmakers. The Standard & Poor’s 500 Index fell 1.3 percent to close at 1,094.9, with Intel Corp. and Texas Instruments Inc. losing ground.
Economists forecast the leading indicators index would increase 0.4 percent, according to the median of 58 estimates in a Bloomberg News survey.
Geithner Forecast
“We expect continued growth in the fourth quarter and ahead in 2010,” Geithner said today in testimony before the Joint Economic Committee of Congress.
He urged Congress to pass a financial regulation overhaul intended to strengthen the banking system and guard against “market-driven excess,” to avoid a repeat of the worst crisis since the Great Depression. Congress is considering a plan that includes changes to oversight of large banks, consumer protection and derivatives.
Federal Reserve Chairman Ben S. Bernanke last week said “significant economic challenges remain” due to a weak labor market and reduced bank lending.
The number of Americans filing claims for unemployment benefits held at 505,000 in the week ended Nov. 14, matching the prior week’s reading as the lowest since January. The number of people collecting unemployment insurance dropped in the prior week, while those getting extended payments jumped.
‘Glacial Pace’
“The labor market is improving, but at a glacial pace,” said Tom Porcelli, a senior economist at RBC Capital Markets in New York, who had forecast claims at 503,000 . “People are having a hard time finding a job as companies remain wary of the economic recovery.”
President Barack Obama on Nov. 6 signed into law a plan to extend jobless benefits, expand a tax credit for first-time homebuyers, and provide tax refunds to money-losing companies. The measure gives jobless people as many as 20 additional weeks of unemployment assistance.
The president has also announced plans to convene a jobs summit at the White House next month.
Manufacturing in the Philadelphia region expanded in November at the fastest pace in more than two years, reflecting gains in orders and sales, figures from the Fed Bank of Philadelphia also showed today.
Factory Rebound
The bank’s general economic index rose to 16.7 this month, exceeding the median forecast of economists surveyed and the highest level since June 2007, from 11.5 in October. Readings greater than zero signal growth.
Six of the 10 components in the leading index contributed to last month’s increase, led by the difference between short- and long-term borrowing costs, fewer jobless claims and higher equity prices. A longer factory workweek, a rise in money supply and an increase in factory orders for consumer goods also helped. Weaker consumer expectations, fewer building permits, shorter delivery times and a drop in orders for business equipment limited the advance.
Manufacturers that export to China and other emerging economies are among companies profiting from growth abroad. Caterpillar Inc., the world’s largest maker of bulldozers and excavators, posted third-quarter earnings that beat analysts’ estimates and issued a full-year forecast that exceeded the highest prediction.
“We are seeing encouraging signs that indicate a recovery may be under way,” Chief Executive Officer Jim Owens said in a statement Oct. 20. “When it comes, it can come quickly, and we, our dealers and our suppliers will be prepared.”
The world’s largest economy probably expanded at a 3 percent annual pace from October through December after growing at a 3.5 percent rate in the prior quarter, according to the median estimate of economists surveyed earlier this month. That followed a 3.8 percent contraction in the 12 months to June, the economy’s worst performance since the 1930s.
The U.S. recession that began in December 2007 cost the top metropolitan areas all of the 2.29 million jobs they had gained in the previous expansion, according to a report released on Wednesday.
“All of the job growth that occurred in the top U.S. metropolitan areas from August 2000 through August 2007 was erased by the subsequent recession,” New York City Comptroller William Thompson said in a quarterly economic report.
The net loss is 7,000 jobs.
The two mature cities with the biggest job losses were Chicago, whose employers cut 257,700 workers, and Detroit, which lost over 467,400 jobs, the report said.
Boston lost 103,500 jobs, followed by Minneapolis-St. Paul, with a loss of 35,500 positions; St Louis, which shed 28,400 jobs, and Philadelphia, where 21,400 positions were lost.
But there were two upbeat notes in this sour trend.
In spite of the financial crisis on Wall Street and thousands of high-paying jobs lost after Lehman Brothers filed for bankruptcy in September 2008 and other banks merged, New York City emerged as part of a positive trend over the entire nine-year period covered by the city comptroller’s report.
The New York-New Jersey area was one of only two “mature metropolitan areas” that succeeded in increasing jobs from August 2000 to August 2009. The New York-New Jersey area added 95,700 positions over that nine-year period, according to the report from Thompson, a Democrat.
Baltimore was the other bright spot, chalking up a gain of 26,500 jobs in that nine-year period,
But in the last expansion, New York City underperformed Washington, D loans until payday.C., Baltimore and Philadelphia in increasing the number of high-paying professional and business services jobs that tend to face less of a threat from foreign rivals than manufacturing, for example.
FEELING WALL STREET’S PAIN
Although New York City fared better than some of its peers, the city comptroller’s report revealed the widespread devastation caused by Wall Street’s implosion due to the credit crunch and the stock market’s slide after the housing market’s bubble burst. A total of 40,000 financial jobs have been lost since August 2007. And the city’s jobless rate jumped to 10.3 percent in September from 6 percent a year-ago.
New York City’s fortunes rise and fall with Wall Street because banks and brokerages spur hiring in service sectors, from florists to law firms, during profitable years.
General sales-tax collections fell 12 percent in the third quarter from a year ago, while income taxes withheld from paychecks dropped 7.2 percent. Manhattan’s office vacancy rate shot up to 11.1 percent in the third quarter — the highest level since the 2004 third quarter, the report said, citing Cushman & Wakefield data.
How swiftly the city exits the downturn rests partly with Congress. The federal government’s newfound zeal for reining in Wall Street’s risk-taking and compensation could crimp the financial industry’s ability to kickstart the city’s economy.
A spate of attacks in Pakistan’s Punjab as Islamic militants work more closely with the Taliban has raised business concern in the province that generates more than half of the country’s economic growth.
Forty-two people were killed last month in Punjab, home to Pakistan’s largest bank and companies producing clothing for retailers Levi Strauss & Co. and Gap Inc. Recent increases in surveillance and arrests are unlikely to reverse the violence that killed more than 220 people in the province in the first 10 months of this year, 20 percent more than 2008, said Ayesha Siddiqa, a Punjabi researcher on military and security issues.
The Karachi Stock Exchange 100 Index fell 2 percent last month, the most since January and only the third negative month this year, as bombings and militant assaults in major cities nationwide hurt investor confidence.
“The implications of this war spreading to Punjab are pretty severe,” said Standard Chartered Plc economist Sayem Ali in Karachi. Punjab represents 55 percent of Pakistan’s gross domestic product, he said. With foreign direct investment down by 60 percent in the three months to September, “our domestic security problems cloud companies’ strategies for coming back into Pakistan any time soon.”
Since the army began its biggest anti-Taliban offensive on Oct. 17 near the border with Afghanistan, bombings have killed about 350 people nationwide, mostly civilians.
Cricket Ambush
While Punjab has seen fewer terrorist attacks than Pakistan’s ethnic Pashtun northwest, guerrillas in Lahore attacked three police headquarters last month and ambushed the Sri Lankan national cricket team’s bus in March. Militants last month raided the army headquarters in Rawalpindi, also in Punjab. The province is home to about half of the country’s 180 million people.
The government must continue to stand up to the guerrillas or “the violence will continue to spread and investors will not feel safe anywhere” in Pakistan, said Habib-ur-Rehman, who manages $48 million of stocks and bonds at Karachi-based Atlas Asset Management Ltd.
Punjab is home to much of Pakistan’s textile sector and the nation’s largest bank by market value, MCB Bank Ltd. Textiles account for two-thirds of the country’s exports in a $165- billion economy.
Pakistan’s overseas direct investment fell 58 percent to $463 million in the three months ended Sept. 30, from $1.1 billion a year ago, according to data from the central bank.
Surveillance Cameras
“We have to keep so many security guards, set up surveillance cameras at the factories,” said Raza Mansha, chief executive of D.G. Khan Cement Ltd., Pakistan’s second-biggest cement maker, based in Lahore, Punjab’s capital and the country’s second-largest city. It “adds to our non-productive expenses and gives foreign visitors a bad impression guaranteed online payday loans.”
D.G. Khan Cement and MCB Bank are part of the Nishat Group, Pakistan’s largest industrial group. D.G. Khan shares fell 16 percent in October and have risen 4.3 percent this month. MCB was down 4 percent in October and is up 7 percent this month.
The benchmark share index has gained 56 percent this year after losing 59 percent in 2008. It rose 2.6 percent yesterday.
Interior Minister Rehman Malik told reporters last month that at least two Punjab-based groups — Jaish-e-Muhammad (Soldiers of Muhammad) and Lashkar-e-Jhangvi (the Army of Jhang, a southern Punjab city) — were operating jointly with the Taliban and al-Qaeda to attack the Pakistani state.
Limited Crackdown
Still, Pakistan’s crackdown on jihadist groups in the province has been limited, and won’t reverse the decades of growth that have made the militant groups a durable part of the political landscape, said Siddiqa.
“The state’s response really has been business-as-usual — selective pressure” rather than a systematic campaign against Islamic radicalism, Islamabad-based Siddiqa said in a phone interview.
For Umer Mansha, chief executive officer of Lahore-based Nishat Mills Ltd., that’s a worrying message. His company produces garments for San Francisco-based Levi-Strauss, the closely held maker of blue jeans and Dockers pants, and Gap, based in the same U.S. city and operator of the Old Navy and Banana Republic chains.
“Textile buyers like to come, see and feel the product,” Mansha, whose company is also part of the Nishat Group, said in an interview Nov. 12. “Buyers are simply not willing to come here. It’s very hard to get new clients.”
More Than Last Year
More than 10,000 Pakistanis — civilians, security forces and militants — have died in the country’s violence this year, a rate 75 percent higher than last year’s record, according to the New Delhi-based Institute for Conflict Management.
“The tactics used in recent attacks in Punjab, plus the literature recovered by police in making arrests, shows that there is more coordination and contact now between Punjab militants and the Arabs of al-Qaeda,” said Muhammad Amir Rana, director of the Islamabad-based Pak Institute for Peace Studies.
Punjab Home Ministry and police officials didn’t respond to phone calls and e-mail messages asking how many alleged perpetrators have been detained in the province.
The “poverty of southern Punjab in particular, and the covert support and funds that militants have had” from Arab donors and Pakistan’s military, “have let them build durable organizations,” said security researcher Siddiqa. “Militancy in Punjab is now a fixture.”
Activision Blizzard Inc’s hugely anticipated “Call of Duty: Modern Warfare 2″ video game went on sale early Tuesday morning, welcomed by eager fans who lined up hours in advance of the release.
The first-person shooter game is set to be one of the biggest and fastest-selling titles in history, challenging records set by blockbuster releases from the “Grand Theft Auto” series.
This despite a dicey economic climate that is pinching consumer spending. Video game industry revenue in the United States, the world’s largest market, is down 13 percent this year, according to industry tracker NPD.
But Call of Duty arrives amid high expectations and plenty of hype. Activision partnered with retailers including GameStop Corp and Best Buy Co for more than 10,000 midnight store openings in North America.
At the GameStop store near Union Square in New York City, around 80 mainly young people were lined up Monday night ahead of the launch, some for two hours.
“This is the only game I’m probably going to do this for,” said Paola Altamirano, 21, who was waiting in the queue. She said she planned to play Call of Duty against another friend online later that night.
With what Activision called a record level of preorders, there was little doubt about the strong demand for a game.
“Gamers are enthusiastic about picking this stuff up at midnight,” said Paul Swiderski, who works at the Union Square Gamestop online payday advance.
Analysts’ sales estimates for the $60 game range from 11-13 million units by the end of 2009. Call of Duty is likely to account for a sizable chunk of Activision’s profits in the fourth quarter, analysts say, so there is plenty at stake in the launch.
HARD-CORE AUDIENCE
The audience for the latest Call of Duty — the sixth installment in the franchise — is primarily younger men, the gaming demographic that makes up the core of the estimated $50 billion global industry.
John Paneto, 20, was lined up outside a Best Buy store in San Francisco with about 10 others at around 10 P.M. Monday. He said he played a number of the other games in the Call of Duty franchise.
“I’m going to be up all night playing it, until I crash,” he said.
Analysts say so-called hard-core gamers are unlikely to be dissuaded from buying a big-name title by economic concerns, as some casual gamers are.
But Call of Duty will have to turn in an impressive performance to top that of last year’s mega-hit from Take-Two Interactive Software Inc, “Grand Theft Auto IV.” The title sold 3.6 million units on the first day, and 6 million in its first week or more than $500 million in sales.
The BlackBerry’s transformation from a device destined for corporate executives’ breast pockets into one with wide consumer appeal was bound to encounter a few bumps along the way.
That’s one interpretation of Research In Motion Ltd.’s plunging shares yesterday, closing down 16.77 per cent, or $15.12, at $75.04 on the Toronto Stock Exchange.
The sell-off was a next-day reaction to Waterloo-based RIM’s weaker-than-expected sales outlook for the busy back-to-school quarter, delivered after the markets closed Thursday alongside a slight dip in fiscal second-quarter earnings.
Frank Marsala, an analyst at Gartner Research, said RIM’s estimate that it will ship between 9.2 million and 9.9 million devices was generally in line with expectations. The concern, however, was with RIM’s disclosure that the average price of each BlackBerry sold to carriers would be $320, lower than the $345 average in the second quarter and less than analysts had been expecting.
"When this happens we have to worry about the ultimate impact of competition," Marsala said.
There’s no question RIM is playing in a much more crowded space than just a few years ago.
Today, the BlackBerry portfolio faces threats from Apple Inc.’s iPhone, devices running on Google Inc.’s Android platform and the recent resurgence of Palm Inc. and its touchscreen Pre.
That translates into increased pressure to cut prices on high-end handsets in order to take advantage of rising interest in full-featured devices that combine traditional voice calling with email, mobile Internet and multimedia applications.
"The company’s (average selling prices) are moving lower as the smartphone market and RIM moves more mainstream," said Deepak Chopra, an analyst at Genuity Capital Markets, in a note to clients.
But others argue that the market’s concerns are overblown.
"I think there are number of things that are being missed in the view of this company in the last 24 hours," said Kevin Restivo, an analyst at IDC Canada fast payday loan no faxing. "RIM is entering its best two quarters of the fiscal year … and RIM usually saves it’s best for last."
Indeed, RIM’s product portfolio has looked a little thin in recent months in comparison to the hype surrounding Apple’s launch of the iPhone 3GS and the introduction of Palm’s Pre.
By contrast, many observers expect this fall to see RIM unveil an updated version of the touchscreen Storm, an iPhone rival, as well as another device some bloggers have described as a "mash-up" between the high-end BlackBerry Bold and the Curve 8900.
"I would expect price points to rise … because its premium products, its best products, are likely to be launched in the coming months," Restivo said.
In the meantime, the average selling price of existing BlackBerry models will be weighed down by efforts to clear out older inventory to make room for the new models.
Also contributing to the trend is RIM’s roll out of a new, low-cost version of the popular Curve model. The Curve 8520 is selling for less than $50 at Wal-Mart stores in the United States when customers agree to a two-year contract with T-Mobile. The device, which runs on slower, second-generation wireless networks, is also expected to be popular in developing countries.
From RIM’s perspective, much of the angst is unwarranted. That’s because demand for smartphones continues to balloon while overall sales of mobile devices are falling. And RIM sees itself as perfectly positioned to take advantage of an increasingly hot sector.
"We are positioning and investing for success here," co-CEO Jim Balsillie told analysts during a conference call Thursday.
"And that’s everything. Or else the world will (pass) you by."
NO. 1 IN THE MEAT MARKET Brazilian beef producer JBS SA is set to become the world’s largest meat processor with an $800 million deal that takes struggling chicken producer Pilgrim’s Pride Corp guaranteed high risk personal loans. out of bankruptcy protection.
Microsoft Corp put its new Zune HD digital music and video player on sale on Thursday, pricing it below comparable Apple Inc iPod devices, in an attempt to claw some market share away from the dominant leader.
The devices, which are available for pre-order but won’t hit shelves until September 15, are priced at $219.99 for the 16 gigabyte version and $289.99 for the 32 gigabyte version. Comparable iPod Touch players are priced at $299 and $399 respectively.
A 16-gigabyte player typically holds about 4,000 songs fast cash personal loans.
Microsoft’s new Zune HD is slimmer than previous version and has a touch screen for the first time. The range comes in five colors and has a built-in radio receiver, Wi-Fi, and can display high-definition video to a big screen.
(Reporting by Bill Rigby; Editing by Derek Caney)
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