McClatchy-Tribune News Service
Business Budget for Friday, February 28, 2014
Updated at 8 a.m. EST (1300 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.
^Subscriptions bring goods to consumers by the box
CNS-SUBSCRIPTIONS-BIZPLUS:OC _ Huntington Beach, Calif., resident Rachel Murphree never thought she'd spend $25 on a tube of mascara, no matter how well it could curl and lift her lashes.
^After sampling products through Birchbox _
For deal-seekers like Murphree, subscription boxes are a relatively cheap way to try popular goods with little commitment. Businesses with featured products in turn garner exposure and potential clients, with a fairly low entry barrier.
1150 (with trims) by Lily Leung. MOVED
^SUVs dominate top of list for affordable insurance
AUTO-INSURANCE:PG _ Drivers looking for the best bargain on insurance may want to consider buying a Jeep, according to Insure.com's annual report on auto insurance rates.
Despite the adventurous lure of the off-road-capable Jeep, the brand snagged seven of the top 20 spots as the least expensive vehicle to insure.
500 by Patricia Sabatini. MOVED
^GM faces tough road ahead as it navigates ignition switch recall
AUTO-GM-REPUTATION:DE _ General Motors Co. faces tough questions as it grapples with a massive recall of several models with faulty ignition switches and a new investigation announced this week by the National Highway Traffic Safety Administration.
The automaker could face civil and criminal penalties as the agency's investigation unfolds. Though NHTSA has never levied criminal penalties before in a recall case, it was given the power by Congress in 2000 as a result of the Ford Explorer's rollover problems with Firestone tires.
1100 (with trims) by Brent Snavely and Nathan Bomey. MOVED
^Analysis: Tesla's risk isn't for every investor
AUTO-TESLA-ANALYSIS:DE _ Once upon a time there was an electric car company whose stock traded at nearly 1,200 times its earnings under generous accounting rules _ it actually lost $74 million in 2013 _ with a CEO who could sell igloos in a desert.
Tesla Motors Inc. is that company and Elon Musk is that CEO. But at this point in the tale, the average investor would be well-advised against jumping on the supercharged bandwagon.
After Tesla reported a $16 million loss for the fourth quarter last week, Tesla shares soared more than 8 percent. The reason was slightly better than expected sales, encapsulated by Musk's "the fish are jumping in the boat" description of his customers, and signs that China sales are poised to soar.
650 by Greg Gardner . MOVED
^Auto review: BMW X5 has power, grace and capability
AUTO-BMWX5-REVIEW:DA _ Big, white SUVs float down the Dallas North Crawlway like ghosts from some distant woods.
They look like vapory blobs to me _ a hard-core, low-slung, three-pedal car guy. And of course, few of these "adventurous" SUVs live up to their billing, rarely placing a tire solidly in mud or atop jagged rocks.
Most tend to be stylish apparitions that haunt sunny soccer fields in the spring and cold, gray parking lots at the mall in winter.
They lug kids and kitsch, I figure.
But then I got to know a 2014 BMW X5 in hard-packed ice. None of the glaze even fazed the brawny BMW, which skated effortlessly along the icy ridges and ruts, never losing its balance or poise.
950 by Terry Box. MOVED
^Auto review: GMC Sierra Denali near the top of its class
AUTO-GMCSIERRA-REVIEW:DE _ I didn't exactly smirk, but I could certainly have been more sympathetic as I sailed past the cars, semis and SUVs buried in snow alongside Interstate 94 as I drove from Detroit to Chicago following a winter storm.
Blame the 2014 GMC Sierra Denali. The spacious luxury pickup made the drive as relaxing as spending the day in my living room. The Denali makes it easy to forget how tough things can be for drivers not cosseted by a four-wheel drive, four-door full-size pickup loaded with electronics and creature comforts.
650 by Mark Phelan. MOVED
^Auto review: Subaru lifts WRX, STI up a grade
AUTO-SUBARUWRX-REVIEW:LA _ They are the bad boys of Subaru's lineup.
Offsetting the brand's crunchy mindset, the WRX and WRX STI pocket rockets have worked hard to bring some tire-smoking street cred to a brand that otherwise markets its vehicles with love and puppies.
Based on the humble Impreza compact sedan, both the everyman WRX and the rally-ready STI are new for 2015. The basics stay the same: turbocharging and all-wheel-drive. But both models get an overhauled chassis, a refined cabin and fresh styling.
1200 by David Undercoffler. MOVED
^Auto review: Kia aims to satisfy your funky Soul
AUTO-KIASOUL-REVIEW:VP _ The worst new car that I ever drove was the 2000 Kia Rio. The Kias that followed were better, but not by much.
That changed with the arrival of the 2010 Kia Soul, an outrageously funky box that proudly proclaimed Kia's arrival on the world stage and maturation into a distinctive brand that stands apart from its Asian competitors. Yes, the Soul was different, an image reinforced by its marketing, which featured rap-loving hamsters.
The Soul was indeed the design soul of Kia's line-up, and every vehicle that has followed in its wake employs some aspect of its esthetic.
So you can understand why the redesigned 2014 Kia Soul doesn't stray far from the corporate Habitrail.
800 by Larry Printz. MOVED
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
AUTO-HOOD:MCT _ Automotive questions and answers.
550 by Brad Bergholdt.
AUTO-PHELAN-COLUMN:DE _ Observations on the auto industry by Detroit-based auto critic.
650 by Mark Phelan. MOVED
AUTO-PRINTZ-COLUMN:VP _ Commentary on autos and America's car culture.
550 by Larry Printz.
AUTO-MOTORING-QA:MS _ Questions and answers on auto maintenance and troubleshooting.
550 by Paul Brand. MOVED
^PERSONAL FINANCE COLUMNS
These features move Friday for Sunday release:
PFP-MARKSJARVIS-COLUMN-ADV:TB _ Sunday release _ Personal finance strategies in response to the news of the day
800 by Gail MarksJarvis. MOVED
PFP-SPENDINGSMART-ADV:TB _ Sunday release _ Methods for managing spending and budgets.
1000 by Gregory Karp. (Not moving)
^PHOTO GALLERIES NOW OFFERED
MCT is now offering photo galleries for use on your websites and apps available at http://www.mctdirect.com/gallery/. In our stuffed photo gallery files you will find hand-picked groups of 10-20 hi-res jpgs, complete with slideshow-ready captions. For a limited time, these galleries are being offered as part of your MCT Photo subscription or are available for download a la carte. If you have content questions or suggestions, please contact the MCT Photo Desk at 202-383-6099 or firstname.lastname@example.org.
^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.
^China makes inroads in the Bahamas with Baha Mar mega-resort
CHINA-BAHAMAS-BIZPLUS:MI _ Cement mixers from China and construction equipment rumble next to a premier strip of white sandy beach as thousands of Chinese workers labor to complete a $3.5 billion resort project at famed Cable Beach.
Bahamian officials hope that the Baha Mar project _ four new hotels, 200,000 square feet of convention space, an 18-hole Jack Nicklaus Signature Golf Course and a casino with a 50-foot glass water wall and a Vegas-style show lake _ will transform Bahamian tourism, putting it on the map as a world-class gaming destination.
But Baha Mar is also noteworthy because of the extensive Chinese involvement in the high-profile project. Not only is the Export-Import Bank of China providing the bulk of the financing, China State Construction Engineering Corp. is the general contractor.
It's all part of China's growing economic and business reach in the developing world.
2500 (with trims) by Mimi Whitefield. MOVED
^Health care's hidden costs can take patients by surprise
PFP-HEALTHCARE-FEES:MI _ When a rheumatologist told Linda Drake of Miami that she might have lung cancer, the former smoker did some research and discovered a University of Miami study for early detection and treatment of the disease with researchers.
Drake, 57, decided to participate in the study at an affiliated outpatient clinic close to work. Her visit last spring took about one hour, she said, including a CT scan. A few days later, an unpleasant surprise arrived in the mail: a bill for $210 for "hospital services" labeled as "Room and Board _ All Inclusive," even though she never set foot in a hospital or spent the night at the clinic.
Her health insurance would not cover the fee. Drake was furious.
Drake is not alone. As hospitals consolidate into mega-health systems, buying physician practices and building urgent care centers and outpatient clinics miles from their main campuses, patients are discovering that _ just like baggage fees for air travel and convenience surcharges for concert tickets _ some health care comes with hidden costs: facility fees.
1250 (with trims) by Daniel Chang. MOVED
^For F/A-18 Super Hornet, the end may be on horizon
SUPERHORNET-BIZPLUS:LA _ Workers at Northrop Grumman Corp.'s 1-million-square-foot facility in El Segundo, Calif., have been cranking out fuselage sections for the Navy's F/A-18 fighter jet for decades.
But now, the end may be near.
Since entering service in 1983, the lithe twin-engine fighter-bomber has been a symbol of U.S. military might, catapulting from aircraft carrier decks and obliterating targets in the sky and on the ground.
Today there are increasing fears that the F/A-18 Super Hornet assembly line may be shut down because of dwindling orders, as the Navy prepares for a new generation of warplane _ the controversial F-35 Joint Strike Fighter.
1200 (with trims) by W.J. Hennigan. MOVED
^Harsh weather puts economy on ice
ECONOMY-WINTER:PG _ Joe Pawlak, the senior vice president of Chicago-based food consulting group Technomic Inc., doesn't hesitate to label this one of the worst winters for restaurants and other food operators: "This is as bad as I've seen it."
Economic analysts are still waiting to gauge the final impact of the meteorological misery.
Snow, ice and frigid temperatures are a factor in slowing down many businesses _ keeping cars sitting on dealers' lots, stalling sales of existing homes, fewer gamblers going to casinos, shipping companies struggling to get deliveries out and retailers waiting by the door for customers.
But that's the short term. The longer-term implications for the economy are less clear. Analysts say some sectors may be able to shrug it off as temperatures warm up, while others could have a harder time recovering.
850 by Teresa F. Lindeman. MOVED
^Oil spill cleanup by sponge: Wisconsin scientists tout tidy technology
SCI-OILSPONGE-BIZPLUS:MW _ In a development arising from nanotechnology research, scientists in Madison, Wis., have created a spongelike material that could provide a novel and sustainable way to clean up oil spills.
It's known as an aerogel, but it could just as well be called a "smart sponge."
To demonstrate how it works, researchers add a small amount of red dye to diesel, making the fuel stand out in a glass of water. The aerogel is dipped in the glass and within minutes, the sponge has soaked up the diesel. The aerogel is now red, and the glass of water is clear.
"It was very effective," said Shaoqin "Sarah" Gong, who runs a biotechnology-nanotechnology lab at the Wisconsin Institute for Discovery in Madiso
900 by Thomas Content in Milwaukee. MOVED
^Designation change could cut critical access hospital funds
HOSPITAL-FUNDS:WI _ In rural areas, small town hospitals can be a lifeline.
But leaders at some rural hospitals are concerned about a report released by the Department of Health and Human Services last fall that suggests the federal government re-evaluate how those hospitals are designated for purposes of Medicare reimbursements.
"I don't think there's any question that it would send some of those hospitals over the edge," said Tom Bell, president and CEO of the Topeka-based Kansas Hospital Association.
A change in designations could affect how much the 1,300 critical access hospitals nationwide receive in reimbursements _ part of the federal government's effort to contain the growth of Medicare.
1200 (with trims) by Kelsey Ryan. MOVED
^Pet medication market opens up as retailers enter game
PET-MEDICATION-BIZPLUS:PG _ When her 12-year-old cat needed an antibiotic a year ago, Karen Sable went, of all places, to a grocery store.
The Munhall, Pa., resident picked up Colby's prescription at a Giant Eagle pharmacy for no charge _ it was one of the grocer's free antibiotics _ and the ailing kitty unwittingly joined a marketing revolution.
Pet medications, once the domain of veterinarians, are increasingly available at grocers, chain pharmacies, specialty pet stores and retailers such as Wal-Mart and Target, all of which are finding the $7.6 billion-a-year pet-med market to be the cat's meow.
Instead of paying whatever their vets charge _ and doctors have been criticized for big markups _ pet owners now can shop for the best prices and rack up retailer loyalty points in the process.
1300 (with trims) by Joe Smydo. MOVED
^Owners again borrowing against homes as market recovers
REAL-EQUITY:LA _ Retired aerospace engineer Owen Klasen was rejected last year when he sought a second mortgage to paint and re-roof his house.
Home prices hadn't risen enough, the loan officer told him.
But last month, the same loan officer offered him more than double the credit he needed.
"I told him I needed $25,000" on a home equity line of credit, said Klasen, who lives in Fillmore, Calif. "He said we were qualified to go up to $60,000."
Klasen is among a wave of homeowners nationally who are again putting their homes in hock _ despite the costly lessons of the housing meltdown.
800 by E. Scott Reckard and Andrew Khouri. MOVED
^'Boomerang' buyers get another chance at homeownership
REAL-BOOMERANG:FL _ Just 10 days before Christmas 2009, Ganel Appolon found an envelope taped to his front door. He and his family were being evicted from their Tamarac, Fla., home. Appolon had fallen behind on his mortgage payments, and the lender repossessed the property under terms of his bankruptcy filing.
Despite the financial setback, Appolon vowed to own again.
He spent the next four years saving money and rebuilding his credit. Last fall, he qualified for another mortgage and in December bought a three-bedroom home in Fort Lauderdale, Fla., for $177,500.
"I feel free," said Appolon, a 46-year-old electrician.
Appolon's experience may give hope to tens of thousands of people snared in the housing collapse. Many of those people thought they'd never own again _ or at least have to wait a decade or longer to even think about it. Instead, lenders and real estate agents say many former homeowners are recapturing the American Dream, as "boomerang buyers."
1100 (with trims) by Paul Owers. MOVED
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