Auto

Auto/Economy
2:53 pm
Wed February 9, 2011

Big checks coming to GM workers

GM's Headquarters in downtown Detroit. GM's Akerson says he "wants compensation for hourly workers to more closely mirror that of white-collar employees and executives." - Wall Street Journal
Rich Evenhouse creative commons

Profit-sharing checks to GM's 45,000 workers are expected to break a record. The news comes as GM is tallying its profit numbers for 2010. The company will release the amount of the checks soon.

The Wall Street Journal reports:

General Motors Co. is planning to pay its hourly workers in the U.S. at least $3,000 each in profit-sharing payouts, the largest amount ever, after the company's return to profitability in 2010, people familiar with the matter said...The auto maker is trying to tow the line between fiscal prudence and expectations that it will share recent gains with workers as the company heads into labor negotiations with the United Auto Workers.

Other U.S. automakers are also sharing the wealth.

Ford Motor Company paid hourly workers more than $5,000, "more than the company was required to pay under the profit-sharing formula in its contract with the UAW," according to the Wall Street Journal.

And Chrysler gave their workers $750 despite the company's losses in 2010.

The Detroit Free Press reports that the checks are expected to be handed out in the months ahead, and the size of the checks could help the automaker in its negotiation with the United Auto Workers union. From the Freep:

The Detroit Three, which will negotiate new labor contracts with the UAW this year, may be giving higher-than-required payments to autoworkers as part of a strategy to convince the rank and file to keep labor costs flat in return for bigger profit sharing in the future, labor experts previously told the Free Press.

Economy
12:48 pm
Wed February 9, 2011

Grand Rapids officials take pay cuts, hope unions will follow

Grand Rapids Mayor George Heartwell says the city's financial future depends on employee concessions in pay and benefits.
Steven Depolo Flickr

Appointed officials in Grand Rapids agreed to scale back the wage increases they recently received.

In a press release, the City officials said they were "responding to Governor Rick Snyder's call for realigning public employee compensation."

City Manager Gregory Sundstrom, City Attorney Catherine Mish, and City Treasurer Lauri Parks said they will return to their salary levels that were in effect in 2009.

City Treasurer Albert Mooney agreed to return 2% of his salary increase.

The Grand Rapids Press reports that if their request is granted:

Sundstrom's pay will fall back to $142,000; Mish's pay will return to $114,092; Parks' pay will go back to $93.731; and Mooney's pay will fall to $108,755.

The officials said in 2010, "appointed officials again led by example, voluntarily accepting an additional 10% reduction in overall compensation." This included turning down a 2.5% pay increase that was scheduled to take effect on June 30, 2010.

The Grand Rapids officials say the the 2.5% pay increase was "received, and is still being enjoyed today,  by all of the City's unionized workforce."

The city is in the middle of re-negotiating it's collective contracts with the City's unionized workforce. And the negotiations are "difficult" as Mayor George Hearwell said in his State of the City address last Saturday.

As Michigan Radio's Lindsey Smith reported, Heartwell said:

The city’s financial future depends on city employees taking further concessions in pay and benefits.

"There’s no doubt in my mind that unless we tackle this problem today, we cannot be sustainable over the long term," says Heartwell.

The vast majority of the city's workforce in Grand Rapids is unionized.

I called up City Attorney Catherine Mish, one of the officials taking the pay cuts. I asked her whether she and the others are sending a signal to the city's unionized employees:

"I would have to say 'yes.' We're hoping the unions agree to similar concessions."

Mish said the unions are under current contracts that run from July 1, 2010 to June 30, 2013.

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Auto/Economy
9:54 am
Wed February 9, 2011

Toyota's electronics exonerated in unintended acceleration claims

Transportation Secretary Ray LaHood talks about the government's investigation into whether electronic systems could have caused unintended acceleration in Toyotas
NHTSA

"The jury is back, the verdict is in."

That’s how Transportation Secretary Ray LaHood announced that faulty electronics played no role in cases of unintended acceleration in Toyota cars.  It’s unequivocal good news for a company attempting to rebuild its reputation.

Last year, Toyota recalled millions of its cars for gas pedal defects that could cause unintended acceleration.

Those recalls shook the company’s reputation for safety like an earthquake.

Dean Stewart is Service Manager for Victory Toyota in Canton, Michigan. The dealership's huge - and nearly empty - service garage, has only one car on a lift that was brought in under a recall.  But last year at this time, the place was bustling:

"I mean we were open 7 days a week, we had two shifts, we were working 90 hours a week just to make sure we could take care of our customers," says Stewart.

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Auto/Economy
1:56 pm
Tue February 8, 2011

Government: No electronic throttle problems in runaway Toyotas

Some safety advocates thought software problems could have led to sudden acceleration problems in Toyotas.
Rebecca Bolwitt Flickr

After a ten-month investigation, the results are in.

From the Associated Press:

A government investigation into Toyota safety problems has found no electronic flaws to account for reports of sudden, unintentional acceleration. Transportation officials and engineers with NASA say two mechanical safety defects previously identified by the government - sticking accelerator pedals and gas pedals that can become trapped in floor mats - are the only known causes for the reports of runaway Toyotas. Both issues were the subject of large recalls by Toyota.

Transportation Secretary Ray LaHood says the department's 10-month study has concluded there is no electronic-based cause of unintended high-speed acceleration in Toyotas.

Toyota has recalled more than 12 million vehicles globally since fall 2009 for a series of safety issues. The company has denied that electronics are to blame.

Agriculture
12:12 pm
Tue February 8, 2011

Michigan Farmers to learn about labor laws

Migrant farmworkers live and work on Michgan farms during the harvest
Craig Camp flickr

Sarah Alvarez-Michigan Radio Newsroom

The Michigan Farm Bureau is starting a six month series to educate farmers about laws that apply to migrant workers and youth labor. Michigan’s agriculture industry is dependent on migrant labor. The industry is still dealing with the effect of a harsh report on worker conditions by the Michigan Civil Rights Commission.

Hannah Stevens is with Michigan State University Extension, one of the sponsors of the series.

In agriculture it’s complicated because there immigration issues there’s housing issue, you know, so many regulatory agencies that look closely at management of labor.  I think particularly it’s a sensitive topic.

Stevens says that pressure to comply with labor laws is also coming from retailers.

The retail stores, Meijer’s and Walmart’s and all these, are beginning to demand that there’s certain responsibility that growers have in terms of managing their workforce. They may reject Michigan produce if they don’t feel that’s being handled correctly. That may put growers in a very awkward position.

The farm bureau expects only about 25% of growers in the state will attend their seminars. The seminars will run from February to July.

Economy
12:04 pm
Tue February 8, 2011

Pure Michigan takes step to getting $10 million dollars more from state

The Lake Michigan shoreline at Frankfort, Michigan
Steve Carmody Michigan Radio

A State House committee this morning approved $10 million to for the Pure Michigan tourism advertising campaign. The full House is expected to vote on the funding this week, and the Senate next week.

The measure may hit the governor’s desk before the end of the month. 

George Zimmerman is a vice president with Travel Michigan.  He says the money is needed as soon as possible.

 "The funding for the national cable TV buy has already been provided up to this point.   But we don’t really have the funding yet for the regional Spring/Summer buys, in key out of state markets like Chicago, Indianapolis, Cleveland, Columbus etc."

The Pure Michigan campaign is expected to be fully funded at $25 million this year with a mix of public and private money.  The Pure Michigan advertising campaign is credited with boosting the state’s tourism industry, but state budget cuts threatened to keep the campaign off the air.

Auto/Economy
7:10 pm
Mon February 7, 2011

Plug-in electric tax credit should be a rebate, says U.S. Sen. Stabenow

Congresswoman Debbie Stabenow
Photo courtesy of www.stabenow.senate.gov

U.S. Senator Debbie Stabenow has introduced legislation to help people who buy plug-in electric cars – and to help the companies making the advanced vehicles.

Right now, someone who buys a plug-in electric car like a Nissan Leaf or Chevy Volt gets a tax credit of up to $7,500.  But the buyer doesn’t collect the money until tax time.

Stabenow says the program could be improved.

I think it would be an even bigger incentive if it were on the front end for consumers.

Stabenow says Congress already approved the money for the tax credit, so it wouldn’t cost any more to give it out as a rebate at the time of sale.

Currently, cars that qualify for the full rebate include the Chevy Volt, the Nissan Leaf, and the Tesla Roadster. Coda and Wheego also make an electric vehicle that qualifies for the credit. Ford, Fiat and Toyota plan to launch electric plug-in cars within the next year.

Stabenow’s legislation would also commit the federal government to spend two billion dollars to help companies that make advanced lithium ion batteries for vehicles. That’s on top of the two billion dollars the federal government has already spent to help the new industry. 

The Congresswoman admits the legislation is being proposed during a tough budget year:

 (But) I think that strategic investments in innovation like battery innovation and manufacturing equals jobs – and so I’m hopeful that this will be a priority.

Michigan received the lion’s share of the last round of federal grants for advanced battery development– more than one billion dollars.  Michigan now has more advanced battery companies than any other state.

Auto/Economy
7:03 pm
Mon February 7, 2011

Federal government to release Toyota unintended acceleration results

Transportation Secretary Ray LaHood will reveal the results Tuesday afternoon of a year-long NASA investigation into claims of sudden acceleration in Toyota vehicles.

Toyota recalled millions of vehicles last year – many because of the potential for loose floor mats to entrap the gas pedal.  In other cases, the gas pedal wouldn’t fully release.

But hundreds of lawsuits allege that Toyota vehicles can also speed out of control because something is wrong with the electronic throttle control system, perhaps due to electromagnetic interference – a problem NASA knows a lot about.

The National Highway Traffic Safety Administration released a preliminary report last year suggesting that in some cases, the sudden acceleration was the fault of drivers, because they hit the gas pedal instead of the brake.

Toyota says it has failed to find any problems with its electronic throttle control systems.  The company did pay record fines last year for delaying recalls.

What's Working
2:41 pm
Mon February 7, 2011

Connecting Detroit's homeless with supportive services and housing

James Marvin Phelps Flickr

Each Monday, our Morning Edition Host Christina Shockley speaks with a Michigan resident about a project or program that is working to improve life in Michigan. The interviews are part of our year-long series, What’s Working.

Today, Christina sits down with Beverley Ebersold, the Senior Program Manager at the Michigan Office for the Corporation for Supportive Housing.

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Auto/Economy
11:57 am
Mon February 7, 2011

Stabenow: rebates for electric vehicles

The Chevy Volt's charging port.
Michigan Radio

Michigan Senator Debbie Stabenow plans to introduce legislation that would change government incentives for buying electric cars.

Right now, the incentive for the purchase of an electric car comes when you file your taxes in the form of a tax credit.

Stabenow's legislation, the Charging America Forward Act, would give consumers a rebate of up to $7,500 at the time of purchase.

The Senator says a rebate would do more to spur consumers to adopt electric vehicles. From Stabenow's statement:

"Michigan is already a leader in emerging hi-tech battery and electric car production. Other countries are acting to develop their own advanced vehicle markets because they realize the tremendous economic potential this new technology represents.  These initiatives will allow Michigan innovators to continue to out-compete the world and create new jobs here"

Naturally, GM spokesman Greg Martin says the company likes the rebate idea, saying "we are pleased to see Senator Stabenow's legislation that integrates all of the components necessary for successful acceleration of electric vehicles in the marketplace.  We look forward to working with Congress on legislation that leads to widespread adoption of electric vehicles."

The Associated Press says Stabenow also wants the incentives to go beyond just consumers:

Stabenow also wants tax credits for investments into electric vehicle recharging stations and for businesses that buy hybrid trucks. It also seeks more funding to develop the nation's advanced battery industry.

And the Detroit Free Press says this bill supports the Obama Administration's plan to get 1 million "plug-in or advanced-technology" cars on the road by 2015. The Freep says it's a goal that "can be reached only if it is supported by aggressive government incentives that also spur the development of infrastructure."

Michigan Radio's Tracy Samilton is following this story, and will have an update later today.

Economy
11:07 am
Mon February 7, 2011

Borders Books "One foot in the grave and one foot on a banana peel"

A big week for Borders
Ruthanne Reid Flickr

This could be a pivotal week for the future of Borders Books with some sources saying the company could seek bankruptcy protection.    

The Ann Arbor-based bookseller delayed payments to publishers and others the past two months.   The company has been trying to negotiate with its vendors and come up with a plan to move forward.    Borders has a half billion dollar financing deal in place, if it can come to terms with its vendors. 

Jeff Manning is a managing director with BDO Capitol Advisors.   Manning’s company closely follows the retail market. 

"The challenge,  if you look at the statistics,  majority of companies that enter bankruptcy do not emerge.  If you look at recent statistics with retailers, an awful lot of retailers have gone straight into liquidation." 

Manning expects Borders’ vendors will decide it’s more in their interest to keep Borders viable. He says, if Borders does file for bankruptcy, the company will probably exit bankruptcy before Christmas.   But Manning says Borders execs must be careful, since the bookseller is in a precarious position:

"One foot in the grave and one foot on a banana peel," says Manning.

 

The Rise and Fall (and Re-Rise?) of Borders Group.

Taxes
8:13 pm
Fri February 4, 2011

Workshops for property tax assessment appeals

Homeowners are starting to get their property tax assessments in the mail. A few organizations are hosting workshops for people who think their home’s value might be over-assessed.

Rose Bogaert is chair of the Wayne County Taxpayers Association:

"Going to the Board of Review and saying 'my taxes are too high' will get you nothing. You have to have information that justifies your contention that your house is over-assessed."

Bogaert says her organization’s workshops educate homeowners about things like how to analyze sales in their neighborhoods. Information about the Headlee Amendment and Proposal A – which govern property tax assessments in Michigan – is also part of the workshops.

Oakland County officials are also hosting a series of sessions about tax assessments through early March.

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Auto/Economy
2:47 pm
Fri February 4, 2011

Casino development in nearby Ohio

User Zoomar Flickr

After years of watching its residents travel to Michigan, Indiana, or Pittsburgh for gaming, Ohio is getting in on the action. Cleveland kicked off its first casino development yesterday.

Developers say they’ll spend $350 million to convert a former department store in the center of the city into a place for slot machines and poker.

Behind all this is Dan Gilbert, the Cavaliers owner and founder of Michigan’s Quicken Loans. He sees this casino as the first phase of gaming in Cleveland. He’ll be building a casino from scratch a few blocks away.

Cleveland Mayor Frank Jackson says the project should create hundreds of local jobs.

They’re actually talking about how can we hire people? How can we hire local contractors, local vendors and make this investment a stimulus for this economy and the people of this city and region.

Dan Gilbert says the Cleveland casino will be integrated into the city, helping local businesses. 

Auto/Economy
1:57 pm
Fri February 4, 2011

Jobless rate falling in Flint

Kettering University junior Steve Needham at the Innovation Center.
Steve Carmody Michigan Radio

From General Motors adding another shift at the Flint Assembly plant to expansion in the city's medical and echnology centers, Flint's job picture is brightening.

Flint city leaders say their community posted one of the ten biggest drops in unemployment in the U.S. over the last 12 months.

Between December 2009 and December 2010, Flint's jobless rate fell from 16 percent to just under 12 percent.

Flint Mayor Dayne Walling says the city helped create or keep mare than a thousand jobs by encouraging entrepreneurial businesses.

For everybody who's left, there's a project out there that kept a job here too. That?s the other part of the story. It may not be a new job. It's not someone who's newly employed. But there are another 500 or 1000 people who would have left here if these projects wouldn't have been successful.

This all builds on what our president said in his State of the Union, that we need to create jobs and industries of the future by doing what America does best.  Investing in the creativity and innovation of our people.

Walling concedes people leaving Flint also helped improve the city's unemployment rate.

Flint's unemployment rate is still above state and national levels.

Economy
12:03 pm
Fri February 4, 2011

Unemployment rate drops to 9 percent

The unemployment rate fell .4 percentage points in January to 9.0%.

Keith Hall, the Commissioner of the Bureau of Labor Statistics said today:

In January, employment increased in manufacturing and retail trade, while job losses occurred in transportation and warehousing and in construction.  Employment in most other major industries changed little. Manufacturing employment grew by 49,000 over the month and has increased by 161,000 since a recent low point in December 2009.

The Associated Press reports:

The unemployment rate has fallen by eight-tenths of a percentage point in the past two months. That's the steepest two-month drop in nearly 53 years. But part of that drop has occurred as many of those out of work gave up on their job searches. When unemployed people stop looking for jobs, the government no longer counts them as unemployed.

Officially, there are about 13.9 million people in the country out of work. The AP says "that's still about double the total who were out of work before the recession began in December 2007."

The unemployment rate in Michigan stands at 11.7% as of December. New numbers should be out in the coming week.

Economy
8:03 am
Fri February 4, 2011

Banking on snowfall at the Chicago Board of Trade

The Chicago Board of Trade
Niala Boodhoo Changing Gears

Parts of the Midwest are still shoveling out after one of the worst blizzards in recent memory.  For some people, they can't see the good in all that snowfall.

But at the Chicago Board of Trade, this blizzard may be a boon for business.

Investors are banking on a futures market based on snowfall that’s the first of its kind in the world.

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Auto Recall
5:49 pm
Thu February 3, 2011

Ford recalls 365,000 F-150 pickup trucks

Ford Motor Company is recalling more than 350,000 pickup trucks
Toolshed4 Flickr

Ford Motor Company is recalling nearly 365,000 F-150 pickup trucks in Canada, the U.S. and Mexico. The problem is faulty door handles that could lead to the doors flying open in a crash.

The F-150 is the best-selling vehicle in the U.S. Most of the recalled trucks were made in the 2009 and 2010 model years.

The National Highway Traffic Safety Administration says a spring in the interior door handle can break, which means the door may not latch properly. So the door could potentially fling open if the truck is hit on the side.

Ford says there have been no crashes or injuries tied to the problem. Ford is also dealing with a large and expensive recall of nearly 600-000 older model Windstar minivans. That one is for corrosion in the axles that could cause the axles to break.

Economy
3:34 pm
Thu February 3, 2011

Report: How land speculators in Detroit make a buck

An old deli in Detroit. Buy cheap, sell high is the land speculator's motto.
Bob Jagendorf Flickr

"If you walked up to him on the street, you wouldn't know that he was a land baron. He's a guy in blue jeans walking around looking like he's working on somebody's building."

- Detroit city attorney Avery Williams talking about Detroit land speculator Michael Kelly.

Christine MacDonald of the Detroit News has a story on how land speculators make money in the city of Detroit.

MacDonald profiles one of the more prolific speculators, Michael Kelly.

The business model for a successful land speculator in Detroit is simple - buy a lot of land for a little money, then sit on the property until it sells for more than you paid for it.

Read more
Auto/Economy
2:24 pm
Thu February 3, 2011

Auto workers get bonus checks

Ford's Rouge River truck plant
Jeff Wilcox Flickr

Detroit automakers are preparing to send bonuses to workers around the region. Even some temporary workers will get a share of growing profits.
Terri Houldieson is technically a temp worker, or a "long-term supplemental employee." But she’ll still get a piece of Ford’s $6.6 billion profit from last year.

Workers like Houldieson should receive, on average, about $2,000 each compared to the $5,000 for regular employees.

"We’ve all put work in and it just shows that they respect us too. Kind of like a pat on the back," says Houldieson.

Ford employs a couple thousand long term temps and most work at assembly plants in Chicago and the Twin Cities.

Houldieson said she’ll buy some new clothes for her two boys, and maybe some expensive shoes to protect her feet during those long hours at the plant.

Business
10:34 am
Thu February 3, 2011

Strong 4th quarter for Dow Chemical

Dow Chemical released its fourth quarter earnings report today and it was a good fourth quarter for the chemical giant. Its earnings nearly tripled. From the company's website:

  • The Company reported earnings of $0.37 per share, or $0.47 per share excluding certain items. This compares with earnings of $0.08 per share in the year-ago period, or $0.18 per share excluding certain items.
  • Sales of $13.8 billion rose 22 percent versus the same quarter last year.

The Wall Street Journal reports:

[Dow Chemical] has seen sales rebound in recent quarters on volume growth in basic chemicals, agriculture products and other units. Dow, whose chemicals are used in a wide range of products including diapers and products in the auto industry, has been restructuring to focus on higher-margin specialty products from commodities chemicals, which are more vulnerable to energy-price fluctuations.

Bloomberg News says the earnings are more than some analysts anticipated and come "amid increasing profit from caustic soda and plastics."

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