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McClatchy-Tribune News Service

Business Budget for Friday, May 16, 2014

Updated at 9 p.m. EDT (0100 UTC)

This budget is now available on MCT Direct at http://www.mctdirect.com, with direct links to stories and art. See details at the end of the budget.

Published on NewsOK Modified: May 16, 2014 at 8:01 pm •  Published: May 16, 2014
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(MCT)

McClatchy-Tribune News Service

Business Budget for Friday, May 16, 2014

Updated at 9 p.m. EDT (0100 UTC)

This budget is now available on MCT Direct at http://www.mctdirect.com, with direct links to stories and art. See details at the end of the budget.

^TOP STORIES<

^GM to pay $35 million fine from NHTSA for acting too slowly in recall<

AUTO-GM-FINE:DE _ The National Highway Traffic Safety Administration has fined General Motors the maximum $35 million penalty for failing to report problems with ignition switches in a timely manner.

The agency also said GM has agreed to take part in unprecedented oversight as a result of findings from NHTSA's timeliness investigation into how the automaker handled the recall of 2.6 million cars with potentially defective ignition switches linked to accidents with 13 deaths.

"What we cannot tolerate, what we will never accept, is a person or a company that knows danger exists and says nothing," U.S. Transportation Secretary Anthony Foxx said during a news conference Friday. "Literally silence can kill."

750 by Todd Spangler and Brent Snavely in Washington. MOVED

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AUTO-GM-FINE:WA _ 300 by Curtis Tate in Washington. MOVED

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^AUTO-GM-FINE-1ST-LEDE-ADV18:LA_<1200 (with trims) by Jim Puzzanghera in Washington and Charles Fleming in Los Angeles. (Moved as a business story) MOVED

^Boeing officer retracts plans to attend conference in Russia<

BOEING-RUSSIA:SE _ Boeing chief operating officer and vice chairman Dennis Muilenburg has pulled out of an economic conference in St. Petersburg next week following pressure from the White House over Russia's role in the crisis in Ukraine.

"We just took the decision over the last couple days to revise our participation," Boeing spokesman John Dern said in an email. "We've changed plans at the request of the U.S. government."

Lower-level Boeing executives will still attend, however.

350 by Dominic Gates in Seattle. MOVED

^Meat labeling vs. free speech: A fine meal for judges<

MEATLABELS:WA _ Key appellate judges will chew over a reheated dispute about meat labels and free speech.

On Monday, 12 judges on what's called the nation's second-highest court will gather in an unusual session to consider claims that country-of-origin label requirements violate U.S. meat producers' First Amendment rights. It's a case with global implications.

750 (with trims) by Michael Doyle in Washington. MOVED

^China's Baidu scores artificial-intelligence coup, hires Andrew Ng to run Silicon Valley lab<

CPT-BAIDU:SJ _ Opening a new front in Silicon Valley's latest arms race, the Chinese Internet company Baidu said Friday that it has hired former Google and longtime Stanford researcher Andrew Ng as chief scientist to run its artificial intelligence research labs in Sunnyvale and Beijing.

Ng, who is also co-founder of the online education company Coursera, is a highly regarded computer scientist who worked on artificial intelligence projects at Google's secretive X division, where he helped create a "neural network" of computers that famously taught itself to recognize images of cats by analyzing thousands of YouTube videos.

The hire is a significant coup for Baidu, which operates China's leading Internet search engine. The company has not indicated any plans to enter the U.S. market, but it has followed the lead of other major foreign tech firms by opening a research office in Silicon Valley _ where it hopes to tap the region's talent pool and gain more prominence within the tech industry.

600 by Brandon Bailey in San Jose, Calif. MOVED

^New takes on jeans, hoodie: Activewear a hot ticket in retail <

RETAIL-ACTIVEWEAR-BIZPLUS:OC _ On a recent Wednesday after work, Shannon Schell pulled on a new, thin-strapped tunic and berry-hued capri pants from Athleta, looking ready for a Pilates or yoga class.

But Schell wasn't going anywhere near a fitness studio. The 45-year-old Tustin, Calif., mom was taking her son to a swimming pool for his team's scrimmage and shopping for groceries afterward.

Consumers like Schell who wear workout clothes as street wear are among the market forces driving retailers such as Urban Outfitters and H&M to enter the fitness clothing arena. Others already in the field, such as Athleta and Lorna Jane, are looking to expand their U.S. and global footprint. Popular activewear retailers including Lululemon are growing their divisions.

1300 by Lisa Liddane in Santa Ana, Calif. MOVED

PHOTOS

^MORE BUSINESS NEWS<

^Darden to sell Red Lobster for $2.1 billion to Golden Gate Capital<

^DARDEN-REDLOBSTER:LA_

The all-cash deal _ which activist investor Starboard Value in February publicly called a "potential destruction of shareholder value" _ will allow Darden to focus more on what Chief Executive Clarence Otis calls the "Olive Garden renaissance program."

After tax and transaction costs, the Red Lobster sale will leave Darden with $1.6 billion. The Orlando, Fla., company plans to use $1 billion to retire outstanding debt and up to $600 million to fund a new share repurchase program.

300 by Tiffany Hsu. MOVED

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Also moving as:

DARDEN-REDLOBSTER:OS _ 400 by Sandra Pedicini in Orlando, Fla. MOVED

^Clean Diesel Technologies seeks to jump-start sales, turn first profit<

DIESEL:LA _ Some companies run from California's strict regulatory standards on air pollution and emissions. Not Clean Diesel Technologies Inc., where the executives can't imagine being anywhere else.

CDTi manufactures and distributes vehicle emissions control systems to automakers and other customers.

The Ventura, Calif., company's products include diesel particulate filters, exhaust accessories and catalysts. Its products reduce emissions from gasoline, diesel and natural gas combustion engines, making its California location especially valuable.

600 by Ronald D. White in Los Angeles. MOVED

PHOTO

^Google Glass gets new leader as company hires marketing expert<

CPT-GOOGLE-GLASS:LA _ Google has been busy over the past month getting its Glass wearable into the hands of more customers, and now the company has also appointed a new leader for the team behind the gadget.

Google has announced Ivy Ross as the new head of Glass. Ross, a marketing expert, comes to Google after stints with Calvin Klein, Gap, Mattel and several others.

Her most relevant experience is her work with Bausch & Lomb, a maker of eye health products. There, Ross served as vice president of design and development for outlook eye wear.

At Google, Ross will be tasked with figuring out how to market Glass as a product for all consumers.

300 by Salvador Rodriguez in Los Angeles. MOVED

^Elon Musk tells business graduates: Just work 'super' hard<

ELONMUSK:LA _ What's the secret to the kind of success that creates worldwide fame and brings in billions of dollars? "Work super hard!" Elon Musk told graduating seniors at the University of Southern California.

What about entrepreneurial genius? An uncanny ability to ferret out and master new technologies and projects? Nah. Just keep your nose to the grindstone.

Musk kept his advice for the 2014 graduating class of the Marshall School of Business and Leventhal School of Accounting brief and to the point: Surround yourself with good people, he said. Focus on the fundamentals. And, perhaps most telling of all, considering the source: Take risks.

"Do something bold," he said.

250 by Shan Li in Los Angeles. MOVED

^Troy Wolverton: Time for FCC to clean up its net neutrality mess<

^CPT-WOLVERTON-COLUMN:SJ_

On Thursday, the agency released its long-expected new proposal to revive net neutrality rules that a federal appeals court struck down earlier this year. As had been previously leaked, the agency recommends that broadband providers be allowed to create paid fast lanes on the Internet and that providers continue to be lightly regulated.

But the proposal throws open the possibility of doing the exact opposite. It seeks comment from the public on whether the agency ought instead to ban all such fast lanes. And contrary to the plan of Chairman Tom Wheeler, it opens the possibility of reclassifying Internet providers as "common carriers," which would subject the companies to far more regulatory scrutiny.

It's as if the agency is of two minds about the direction forward _ that, or it doesn't have the courage to fully embrace its own recommendations.

700 by Troy Wolverton. MOVED

^AUTO STORIES<

^Senior drivers dread conversation about handing over keys<

^AUTO-SRS-NODRIVING:DE_

"I was a little incensed," said the 96-year-old former manufacturing manager.

The conversation wasn't easy for his children either.

"We were very cognizant of the fact _ and this is important _ that if he lost his ability to drive, this would seriously affect his independence and his sense of self," said daughter Nancy Villa Bryk, an Eastern Michigan University professor.

"It was a very difficult conversation, and he found it profoundly upsetting, which was upsetting to me," she said.

Analyzed by miles traveled, the risk of being involved in a fatal crash begins climbing at age 75 and increases notably after age 80 _ a result of increasingly frail bodies and medical complications from injuries.

And though older drivers are less likely to get into accidents overall, in part because they limit their driving to familiar roads and safer times of the day, research suggests they have a tougher time making left turns at intersections, for example.

1200 by Robin Erb. MOVED

PHOTOS

^AUTO REVIEWS<

^Auto review: Hyundai's latest Tucson _ agile, frugal, and versatile<

^AUTO-HYUNDAITUCSON-REVIEW:FT_

Now, for 2014, the five-passenger compact crossover offers Hyundai's first panoramic sunroof, touch-screen navigation, Bluetooth hands-free phone, Hill Start Assist Control and Downhill Brake Control.

The sunroof and navigation are included in a Technology Package ($2,750), along with LED taillights and a premium 360-watt audio system with seven speakers (two front door mounted, two tweeters, two rear and a subwoofer).

Mechanical upgrades for 2014 include two new direct-injection engines _ a 164-horsepower 2.0 liter and 182-horsepower 2.4 liter inline four-cylinder, which produce more torque and are more efficient than those in the 2013 models.

1100 by Emma Jayne Williams. MOVED

PHOTOS

^Auto review: Dodge Durango: same name, nicer ride<

^AUTO-DODGEDURANGO-REVIEW:VP_

Too many buyers considering three-row crossover SUVs look past the Durango mainly because the initial version was little more than an SUV shell plopped atop a Dodge Dakota pickup frame. As you can imagine, refinement suffered as a result.

And the previous generation saw the Durango grow, but more in terms of attitude than civility.

Finally, in 2011, a Dodge Durango appeared possessing the second generation's attitude, but gaining an impressive amount of sophistication. For 2014, a number of midcycle changes gild the lily.

1000 by Larry Printz. MOVED

PHOTOS

^COLUMNS<

^<

These features regularly move on Friday:

^<

WEEKAHEAD:MI _ A preview of the business world's biggest events in the coming week.

300 by Tom Hudson. MOVED

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AUTO-HOOD:MCT _ Automotive questions and answers.

550 by Brad Bergholdt. MOVED

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AUTO-PHELAN-COLUMN:DE _ Observations on the auto industry by Detroit-based auto critic.

650 by Mark Phelan. MOVED

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AUTO-MOTORING-QA:MS _ Questions and answers on auto maintenance and troubleshooting.

550 by Paul Brand. MOVED

^PERSONAL FINANCE COLUMNS<

^<

PFP-MARKSJARVIS-COLUMN-ADV:TB _ By Gail MarksJarvis.

Not moving this week.

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PFP-SPENDINGSMART-ADV:TB _ Sunday release _ Methods for managing spending and budgets.

1000 by Gregory Karp. MOVED

^BEST OF BUSINESS: THE WEEK'S TOP FEATURES<

EDITORS: The following are among the best McClatchy-Tribune News Service business stories that moved this week and are still suitable for use this weekend and beyond.

^New takes on jeans, hoodie: Activewear a hot ticket in retail <

RETAIL-ACTIVEWEAR-BIZPLUS:OC _ On a recent Wednesday after work, Shannon Schell pulled on a new, thin-strapped tunic and berry-hued capri pants from Athleta, looking ready for a Pilates or yoga class.

But Schell wasn't going anywhere near a fitness studio. The 45-year-old Tustin, Calif., mom was taking her son to a swimming pool for his team's scrimmage and shopping for groceries afterward.

Consumers like Schell who wear workout clothes as street wear are among the market forces driving retailers such as Urban Outfitters and H&M to enter the fitness clothing arena. Others already in the field, such as Athleta and Lorna Jane, are looking to expand their U.S. and global footprint. Popular activewear retailers including Lululemon are growing their divisions.

1300 by Lisa Liddane in Santa Ana, Calif. MOVED

PHOTOS

^Smokey Bear, nearly 70, gets a millennial makeover<

SMOKEYBEAR:LA _ Smokey Bear turns 70 this summer. But instead of kicking back in retirement _ whacking golf balls or sniffing around for early-bird dinner specials _ the bear in bluejeans is returning to work to educate people about wildfires.

Last year, there were 47,579 wildfires nationwide, according to the federal government. Typically, nine out of 10 are caused by humans. Fire danger is expected to be high this summer, particularly in the parched Western states.

So, with the help of local ad agencies, Smokey Bear has been enlisted for a new marketing campaign to remind humans to be more careful.

Handlers of the iconic animal have decided he needed a younger and fresher look. They want him to fit in with the millennial generation of teenagers and young adults.

1050 by Meg James in Los Angeles. MOVED

PHOTO

^After decades of exodus, companies returning production to the U.S.<

WRK-RETURNING-JOBS:LA _ In 2001, Generac Power Systems joined the wave of American companies shifting production to China. The move wiped out 400 jobs in southeast Wisconsin, but few could argue with management's logic: Chinese companies were offering to make a key component for $100 per unit less than the cost of producing it in the United States.

Now, however, Generac has brought manufacturing of that component back to its Whitewater plant _ creating about 80 jobs in this town of about 14,500 people.

The move is part of a sea change in American manufacturing: After three decades of an exodus of production to China and other low-wage countries, companies have sharply curtailed moves abroad. Some, like Generac, have begun to return manufacturing to U.S. shores.

1150 by Don Lee in Whitewater, Wis. MOVED

GRAPHIC

^Dealflicks aims to put movie fans in cheaper seats<

^DEALFLICKS-BIZPLUS:LA_

They were loading the converted minivan with suitcases, sleeping bags, brochures and yellow "Dealflicks" T-shirts in preparation for a six-week road trip to visit movie theaters in Kansas, Iowa, Michigan, Boston and Illinois. The sales team members planned to take turns sleeping and driving as they stopped by theaters to personally market their service.

After four road trips and logging more than 40,000 miles to dozens of cities, Hong and his team have helped transform Dealflicks Inc. from a fledgling Los Angeles start-up into a fast-growing discount ticketing service for theaters across the country.

"The idea is to increase as much face time as possible," said Hong, co-founder of Dealflicks. "We'll be hitting as many theaters as we can."

1050 by Richard Verrier. MOVED

PHOTOS

^Considering a new career? Think outside the box<

^WRK-CAREER:TB_

Only 13 percent of people feel a sense of passion or a deep connection to their work, while 63 percent are unhappy _ or disengaged, according to an October report by Gallup. It's possible, however, to use the skills you've already got and apply them to a new career.

650 by Danielle Braff. MOVED

^College grads face uneven job market<

CMP-WRK-JOBS:AT _ Neal Caldwell of Woodstock, Ga., has an enviable dilemma. The Kennesaw State finance major, who graduates this month, must choose among "five solid offers" from employers. They include sales positions in Denver, Boston and England, he said.

"The compensation is quite good," he said. "It's really about deciding where I want to live."

At the other end of spectrum is Leah Daniell of Austell, Ga. She's also 22 and graduating with a political science degree from Georgia State. She's applied for more than 30 jobs and spent hours sniffing out clues on websites, sending out resumes and strolling into Big Box retailers to find someone's hand to shake.

"It's not promising" she said.

As the pair's stories show, this year's graduates step into a modestly improving but uneven economy. Some skills are in demand, while many grads _ and not just those with liberal arts degrees _ scrap for a paycheck healthy enough to keep them out of their parents' basements.

1250 by Michael Kanell in Atlanta. MOVED

^Book offers tips for ranks of female breadwinners<

WRK-WOMEN:PG _ As Farnoosh Torabi researched and wrote her latest book, "When She Makes More: 10 Rules for Breadwinning Women," she was on a mission to understand how to navigate the financial and psychological obstacles in her own marriage.

"I found there were some specific challenges as a result of being a female head of household," Torabi said. "I needed a book with advice for my own marriage in terms of how to negotiate the different roles in our relationship, such as managing money and how to manage a family once we have children."

800 by Tim Grant in Pittsburgh. MOVED

^For state workers, a thaw in frozen wages<

^WRK-GOVWORKERS:SH_

An exact accounting of how many states are considering increasing pay _ and by how much _ is difficult to come by. But those who follow state worker pay, including advocates on the left and right, say workers this year will get a boost in many states, including some controlled by Republicans.

The most recent U.S. Labor Department report on wages and salaries for state and local government workers found pay increased 1.2 percent from March 2013 to March 2014, compared to 1 percent the previous year. More than 40,000 government jobs have been added so far this year.

"There are states that are looking to boost pay after years of furloughs and actual pay decreases," said Leslie Scott of the National Association of State Personnel Executives. "Most of the time it's very modest increases, but nonetheless it's an increase."

1300 by Jake Grovum. MOVED

^Small-scale publisher carves niche in digital age<

NICHEPUBLISHERS-BIZPLUS:MW _ The digital revolution has written a nail-biting new chapter for book publishers. E-books are overtaking their paper-bound counterparts as bookstores vanish and Amazon.com inflicts unrelenting price pressure on a time-honored trade.

For all the upheaval, however, little has changed at Milwaukee-based Henschel HAUS Publishing Inc.

"Regardless whether it's an e-book, a print book or an audiobook, it still needs to be edited, it still needs formatting, it still needs a compelling cover," said Kira Henschel, the one-woman founder, owner, agent, editor and writing coach of the 12-year-old publishing house.

Small publishers like Henschel might lack prestigious Manhattan addresses and teams of publicity professionals, but their startup scale has advantages in the new world of book publishing.

There's a clear shift toward shorter and more precisely calibrated printing runs of new titles, rapidly replacing the mass-production model of the pre-digital era. Meanwhile, the number of new book titles is ballooning, led by a profusion of small press imprints, short-run niche titles and works by authors who self-publish at their own cost.

1350 (with trims) by John Schmid. MOVED

PHOTOS

^Med-tech industry is booming in China<

USCHINA-MED-TECH:MS _ A Chinese market for medical technology used to be on the long list of lofty goals for devicemakers like Medtronic. Now U.S. med-tech firms are seeing double-digit growth as they partner with Chinese manufacturers, purchase Chinese companies and race to educate and woo Chinese doctors and patients eager to tap the latest technology.

A growing Chinese middle class and increasing investment in health care by the Chinese government are making such devices as pacemakers, defibrillators, insulin pumps and spine products accessible to hundreds of millions of new patients. More-familiar factors play a role, too, as the nation falls prey to such chronic ailments as heart disease and diabetes, meaning even more customers will lean on technology from U.S. devicemakers to prolong and improve their lives.

1400 (with trims) by James Walsh. MOVED

PHOTO

^<

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