Wednesday morning headlines

Strike looming?: Tomorrow is the union-imposed deadline to agree on a new contract with the three major supermarket chains, and for the last day or two there's been a scattering of news stories suggesting that negotiations have stalled. The latest is today's WSJ, which has the United Food and Commercial Workers and the three major chains saying it's unlikely they'll come to terms by Thursday. The next step would be for union officials to ask members to vote on the companies' most recent proposal over the weekend. Then, workers at Ralphs and Vons would vote on whether to authorize a strike. It's a good bet there's more to the story than what's being trumpeted by the mouthpieces, so don't assume a strike vote is going to happen.

Kerkorian pulls back: We should know by now that the L.A. billionaire has this way of exiting a deal almost as fast as he enters it. This morning comes word that his plans to take over MGM's Bellagio Hotel and Casino and the giant Project CityCenter development have been withdrawn. The idea was to put all of MGM Mirage into play - and indeed the stock is 37 percent higher than before Kerkorian announced his intentions (good for him since he owns 56 percent of the company). MGM is announcing plans for yet another big casino resort - this one on the north end of the Vegas strip to be developed with South African casino magnate Sol Kerzner so the apparent thinking is that additional value is already being provided to shareholders without having to break up the joint. Still unclear is whether the MGM Mirage would still be in play. AP

Passport staff unprepared: This one's going to be a shocker: In preparation for the influx of passport applications after new rules required more than a driver's license or birth certificate to enter Mexico and Canada, only 218 workers were hired not the 465 that had been first planned. Ann Barrett, deputy assistant secretary of State for passport services, says those numbers are off - that her office hired 250 employees and never promised more. "None of us has a crystal ball," she says. OK, so the number of passport applications is expected to go from 12 million to 16 million a year and you can't figure out that 218 new employees or 250 new employees for the entire country wouldn't be enough? From the LAT:

Officials within the travel industry beset for months by panicked vacationers say the State Department's miscalculation was drastic. "Clearly, they didn't hire enough," said Rick Webster, chief Washington lobbyist for the Travel Industry Assn. of America. "They simply asked for too little in terms of resources. They admit that, but they almost talk about it as if it was a factor of degrees. But it was a bigger miss than that." Barrett announced plans this month to hire 400 more workers by October at a cost of $37 million, but screening and training them could take several months.

Truckers oppose port plan: At least some of them. This is the proposal that would phase out independent owner operators and replace them with large trucking companies that would hire many of these same truckers. The idea is to bring in newer, less polluting vehicles that the current owner operators can't afford. (The port will offer taxicab-type concessions to the trucking companies.) About a dozen drivers and motors say that the plan would undermine their economic independence - and that clean air goals can be accomplished under the current system. From the Press-Telegram:

Ron Guss, president of Intermodal West in Pico Rivera, said the plan upends a business model that has worked in the 27years since federal motor carrier deregulation. "Right now, we have an efficient system, which gets goods delivered on time and to the right place," Guss said. "If people started working eight-hour shifts, drivers won't be able to haul as many loads in a day, so there will be a need for more drivers. More drivers means more congestion, longer lines at terminals, more fuel being used and more pollution." Plan supporters, including environmental groups and labor organizations, defend it by pointing to the same owner-operator system, which they say provides drivers with little money to pay for expensive new truck replacements, maintenance and exhaust filters.

United must move turboprops: U.S. Bankruptcy Judge Eugene R. Wedoff, who has been handling United's bankruptcy case, refused to grant the airline an injunction that would have allowed it to continue docking its turboprop fleet at LAX's Terminal 8. Airport officials have been trying to free up space for more flights by relocating dozens of small propeller planes to remote gates. Other big airlines complied, but United has refused because, according to a spokesman, it "provides an improved experience for our customers." But a review of airport operations in the late 1990s concluded that by using the main terminals turbojets were contributing to flight delays. Daily Breeze

C-17 gets reprieve: They can't seem to kill off that Long Beach production line for the big Air Force transport. Under big-time pressure from Congress, the plant will stay open a while longer. It had been scheduled for closure by mid-2009 with the rollout of the last C-17, but the company says it will invest its own money to keep the operations going until at least 2010, in hopes of getting more orders after that. The Air Force now says that it wants to buy more C-17s but can't do so until after 2010 because of budget and planning constraints. Of Boeing's 31,000 workers in Socal, 5,500 work on the C-17. LAT

Lonelygirl15 cuts deal: Yeah, it's the same Lonelygirl15 who supposedly was a real-life video blogger but turned out to be an L.A.-based actress (Jessica Rose) playing an elaborate Web hoax dreamed up by some young filmmakers. Well, Neutrogena has inked a deal with those producers to help market "Lonelygirl15." CAA, which represents the Web series and its producers, approached the cosmetics company about a tie-in with the Lonelygirl15 Web shows (kind of a natural given the demographic Neutrogena wants to attract). Financial terms not disclosed. Variety

Big bond buy: Retail orders from Monday and Tuesday's sale of California tax-free general obligation bonds totaled nearly $700 million, part of the planned $2.5-billion offering. The remaining $1.81 billion will go on the market today for purchase by banks, brokers and other institutional investors. The final interest rate paid on the bonds is expected to range from 4 percent to 4.7 percent. This week's sale was helped along by a $250,000 state campaign that featured print and radio ads urging state residents to invest in bonds for bridges, roads, universities and other needed public works. LAT

WGA to rep cable writers: As part of the deal, the Writers Guild will cover about 30 writers who work for four Comedy Central shows: "Mind of Mencia," "The Sarah Silverman Program," "The Showbiz Show With David Spade" and the upcoming series "American Body Shop." The separate pacts include WGA compensation levels, pension and health benefits, credits and a residual formula for reuse. Earlier this year, the WGA made deals to represent writers on "The Daily Show With Jon Stewart" and "The Colbert Report." Variety


More by Mark Lacter:
American-US Air settlement with DOJ includes small tweak at LAX
Socal housing market going nowhere fast
Amazon keeps pushing for faster L.A. delivery
Another rugged quarter for Tribune Co. papers
How does Stanford compete with the big boys?
Those awful infographics that promise to explain and only distort
Best to low-ball today's employment report
Further fallout from airport shootings
Crazy opening for Twitter*
Should Twitter be valued at $18 billion?
Recent stories:
Letter from Down Under: Welcome to the Homogenocene
One last Florida photo
Signs of Saturday: No refund
'I Am Woman,' hear them roar
Bobcat crossing

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
 
Mark Lacter, business writer and editor was 59
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