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December 28, 2001 Headlines----
Can You Believe it??? Chevrolet Avalanche is Motor Trend Truck of the Year ALERTS---- (the only leasing media to notify readers) ### Denotes Press Release Monday Leasing News---December, 1971 Remembered, by Kit Menkin SPECIAL
YEAR-END REPORT---Tuesday, January 1, 2002 ( Leasing News will not have a January 2nd issue to allow those on holiday to catch up. Monday and Tuesday news to be posted on Wednesday noon, California time, at www.leasingnews.org ) ----------------------------------------------------------------------------- Meet the Leasing News Maker---January 10th---Bill Hansen, Commercial Money Center ( live at 1pm, California time ) http://www.leasingnews.org/newsmaker.htm If there is another newsmaker readers would like to meet on line, please let us know at kitmenkin@leasingnews.org -------------------------------------------------------------------------- Interest
rate rises in two-year Treasury note auction WASHINGTON (AP) Yields on two-year Treasury notes rose in Thursday's auction to the highest level in four months. The yield was 3.300 percent, up from 3.008 percent at the last auction on Nov. 28. It was the highest rate since two-year notes sold for 3.685 percent on July 29. The notes will carry a coupon interest rate of 3¼ percent with each $10,000 in face value selling for $9,990.40. A total of $23 billion in notes were sold out of bids totaling $55.3 billion. _____________________________________________________________________ ConsumerConfidence Rebounds The Associated Press NEW YORK -- Consumer confidence rose sharply in December following three months of dramatic decline, as the erosion of the economy and job market appeared to begin leveling off. The New York-based Conference Board said Friday that its Consumer Confidence Index rose to 93.7 this month from a revised 84.9 in November. Analysts were expecting a reading of 83. The index, based on a monthly survey of some 5,000 U.S. households, is closely watched because consumer confidence drives consumer spending, which accounts for about two-thirds of the nation's economic activity ----------------------------------------------------------------------------- --------------------------------- President grants permanent normal trade relations to China, ending annual struggle Opens Up International Equipment Leasing By Scott Lindlaw, Associated Press CRAWFORD, Texas (AP) President Bush granted China permanent normal trade status Thursday, ending a quarter-century policy of using access to U.S. markets as an annual enticement to the communist giant to expand political and economic freedoms. Boeing Co., among the first companies to do business in China after former President Nixon's historic 1972 visit, praised the decision with a prediction of an immediate increase in the number of U.S. companies looking to expand China operations. ''It's a great moment for us, because it allows a normal, steady relationship with a huge market,'' said Fred Kelley, a spokesman for the Chicago-based aircraft maker. The president's decision made a final act to yearly battles in Congress since 1980 that at times divided the Democratic Party during the Clinton years. It was set up by China's admission last month to the World Trade Organization. Bush called the trade proclamation the ''final step in normalizing U.S.-China trade relations'' and said it would open up the vast Chinese markets to billions of dollars in American goods. The new trade status takes effect Jan. 1, Bush said in the announcement released in Crawford, Texas, where he is vacationing. ''This is the final step in normalizing U.S.-China trade relations and welcoming China into a global, rules-based trading system,'' he said. Technically, Bush's proclamation formally removed China from having to adhere to the 1974 Jackson-Vanik Amendment to the Trade Act of 1974. The amendment, initially aimed at the former Soviet Union's restrictions against Jewish emigration, withholds normal trade relations with communist states that restrict emigration. Since 1980, China has enjoyed temporary normal trade relations with the United States under annual presidential waivers of the law. But each waiver has triggered debates in Congress over China's record on human rights and weapons proliferation abuses. The last one occurred in July, when the House voted 259-169 to approve Bush's waiver this year, the last that will be necessary. The annual congressional battle pitted American business and its Republican allies against big labor and its Democratic supporters. Former President Clinton, at odds with many in his own party, started the process of moving China toward permanent trade status before he left office. Congress last year granted the permanent status to China contingent upon its entry into the WTO. Its application was accepted formally at the WTO's annual meeting last month in the United Arab Emirates. The annual struggle also inflamed tensions with China each year and prompted worries in that country every time it arose. China and the United States reached an agreement, as part of China's WTO entry, that will lower China's tariffs on U.S. goods and open up its service sector to American companies. China's tariffs on U.S.-made goods are to fall from an overall average of 25 percent to 9 percent by 2005. Duties on America's primary farm products are to drop from 31 percent to 14 percent. China has an $80 billion trade surplus with the United States. Bush has long supported trade with Beijing, even during the standoff over a U.S. spy plane that collided with a Chinese jet fighter and made an emergency landing on Chinese territory early this year. In asking Congress for a temporary extension in June, he argued normalized relations would benefit the American economy and be critical to promoting an ''economically open, politically stable and secure China.'' Bush argued that U.S.-China trade benefits both American farmers, who last year exported to China and Hong Kong goods worth more than $3 billion, and American business, which last year increased overall exports to China by 24 percent. On the
Net: U.S. Embassy in Beijing page on announcement: ### ############################## ############# Xerox Receives $340 Million in Financing From GE Capital; Cash Balance Increases to About $3.9 Billion STAMFORD, Conn.-- --Xerox Corporation (NYSE: XRX) announced today that it has received $340 million in financing from GE Capital, secured by portions of Xerox's lease receivables in the United States. With this funding and following the repayment of $1.1 billion in debt that matured this quarter, Xerox's current cash position has increased to approximately $3.9 billion. The $340 million is in addition to the $835 million received last month from GE Capital, with additional funding expected in February 2002. These financing arrangements amortize over a period that extends into 2004. #### ############################### #################### ALERTS---- http://www.leasingnews.org/Conscious-Top%20Stories/alerts.htm reaction to Paul Menzel's comment:. "Name Withheld" (good call) is complicit in the SP&T alleged fraud by packaging a $38,000 deal as a $25,000 deal so they could get it approved as a corp only. This kind of behavior is what has led to the consolidation and loss of funding sources in our industry. Get wise! ... get honest! ... or get out! To quote some sage advice that applies here: "EXPECT
NOTHING, Brokers and discounters need to participate in the responsibility we all have in uncovering and avoiding fraud in our industry. Know the RED FLAGS of fraud and pursue them. Too many are turning a blind eye in pursuit of the almighty fee. There is a lot of good business out there to be funded if we all take responsibility for the health of our industry. PAUL MENZEL ---- Thanks for the defense of "name withheld" on S P & T. I'm sure no one, including Mr. Menzel, would care at this point, but for the record, the deal was submitted to us as "corp only" for $38,000 and submitted to the funding source as same. It was the funding source that decided it was not "strong enough" and came back with a $25,000 approval. As is their S.O.P. 1. It was NOT "packaged" and submitted as a $25,000 transaction to "slide under the radar screen" at the funding source. We STRONGLY REJECT the implication. Further, 2. The transaction was "approved" BEFORE we completed our own "due diligence." We continued to pursue our own investigation after the approval BECAUSE we were acting responsibly and professionally...AND WE KILLED THE APPROVAL (not the funding source). Mr. Menzel's note concludes with the sage advice, "Know the RED FLAGS of fraud and pursue them. " To which we say, "We do!" and "We did!" I hope that all of his bank's brokers can say the same. I think you're being way to kind to Mr. Menzel. He was attacking our integrity and congratulating us for having the foresight to "hide our identity" from what in HIS sanctimonious opinion, was our irresponsible behavior (i.e. "submitting" for $25K...to "trick" the funder!) The fact is, as you know, that it was a liable issue, nothing more, nothing less. I think simply reporting the facts as we uncovered them (as opposed to announcing conclusions or making allegations) without fear of repercussions was "the issue" for us. The only other alternatives would have been risking legal entanglements OR sitting on our hands and allowing another funder, perhaps one on Mr. Menzel's banks, to step into the same pile of dung. I STILL think we took the high AND responsible road. I have nothing to hide from Mr. Menzel and I will say all of this to him directly. THANKS. ( Name Withheld ) Thanks for your email ******* I otherwise wouldn't have known the original author or the details of the deal. Not knowing either, I was using the ALERT as merely an anonymous example in order to raise the discussion to a moral level. Our industry, with the assistance of Leasing News as a free forum, needs to examine its practices and challenge its participants to police its own health ... including the funding sources. When a fraud or credit loss occurs, everyone in the transaction chain loses. I didn't
expect anything, I am tired of reading of funding sources exiting the leasing industry altogether or cutting out the broker/lessor and going direct. This phenomenon is a result of poor industry practices during the recent expansion. I acknowledge that the funding sources, in many instances, were (are) willing partners. In your case, the funder was also complicit. I could have just remained silent and not responded as I did. I believe that controversial and frank discussions such as this one will help us all ponder "Best Practices". We all need to examine our practices and be honest with ourselves about whether or not they serve our ultimate Master ... Credit Risk Management. If the economics don't compute, the indirect segment of our industry will die. I realize that commentary like mine might create controversy, however, I did not intend it to be personal but I did intend it to spark reflection. The more we know, the more we learn. Thanks for setting the record straight ******* ... I learned something. PAUL MENZEL
And thank YOU as well. I appreciate your taking the time to share your point of view with me. You are absolutely right that if we all don't take a much more proactive approach, our segment of this industry may soon just "disappear". FYI, the funder approval in the case at hand was from Colonial's BLISS system. And it is at least the third time that we have picked up on frauds that had slipped through their system and would otherwise have funded. One can only speculate on how often that was NOT the case and how often the resulting lease losses were written off to problems with "broker business..." Resulting ultimately in two likely and very unfavorable results: 1) GE/Colonial exiting the broker business altogether and, 2) the almost certain invasion of the more traditional broker territories by other arms of the GE (direct & vendor) marketing machine. THANKS. N ---- The alert response is great. We should all be willing to contribute and clean up the industry. As a funding source M & C certainly appreciates a heads up to potential problems. I agree with Paul Menzel that we need to take responsibility for our industry. If we look out for each other we all survive. It is not about competition. I have stated we do pursue our own problems within our company but will continue to share alerts. John Gallo
---- I believe you had published a Fraud Alert for a company called PC Audio FX in Florida (they are incorporated in Delaware). There are MANY vendors, some VERY legit ones that we believe were not actually participating in the fraud...I wanted your readers to be aware of this. We saw three different deals from them, three different vendors, they kept coming back for more money. We actually sent out a Quick Trak to some of his "Locations", called landlords...his corporate address is an apartment, there is actual equipment and locations....HE USES MANY OTHER BUSINESS NAMES!!! So please be aware that PC Audio Fx is NOT his only business!!! I have more information if anyone is interested... Thank you, _________________________________________________________________ -- Request to Readers---Magazine/Newsletter Back Issues Past Magazine/Newsline Editions---for research and "obituary purposes," Leasing News is trying to build up our library. If you have any old issues of Equipment Lease/Finance Report/ WAEL or UAEL Newsline/ or any industry magazine, we would be glad to send you a UPS pre-paid envelope or send to us UPS collect at 346 Mathew Street, Santa Clara, Ca. 95050. One of our projects in the future will be to catalogue them. ----------------------------------------------------------------------------- -- The Leasing Association 2002 Meeting Schedule is being up-dated. We have asked the associations to give us dates and information of meetings they have scheduled for next year. Leasing News will be up-dating the dues comparison, membership totals, and other information, as provided to us. ----------------------------------------------------------------------------- ----------------------- AOL subscriptions
climb to 33 million "daily usage of 70 minutes" By Jim Krane, Associated Press NEW YORK (AP) The world's largest Internet service provider, America Online Inc., said Friday it added another million subscribers, reaching 33 million customers. AOL, a subsidiary of AOL Time Warner Inc., credited the increase in subscribers to the October release of its updated software, version 7.0. The announcement came just a month after AOL hit the 32 million mark on Nov. 26. Trailing AOL in subscriber numbers is Microsoft Corp.'s MSN Internet Access, with 7 million customers. No. 3 EarthLink counts 4.6 million paying customers, according to figures provided by Jupiter Media Metrix. The jump in customers comes despite an increase in AOL's monthly service fee, which at $23.90 for unlimited use is the most expensive major online service in the United States, said Dylan Brooks, a Colorado-based analyst with Jupiter Media Metrix. AOL, which provides Internet access as well as unique content such as magazines, music and news, is looking to push its customers into higher-cost broadband connections via cable or digital subscriber line subscriptions, said chief executive Barry Schuler. AOL now offers broadband service in 20 Time Warner Cable markets, along with DSL connections through local telephone companies BellSouth Corp., Qwest Communications, SBC Communications and Verizon Communications. High-speed access to AOL is also available through DirecPC satellite service. Brooks said the company's revenue growth depends on converting low-paying or nonpaying dial-up subscribers to broadband. AOL's unlimited monthly broadband service costs more than twice as much as its unlimited dial-up plan, but the faster data speeds will allow consumers to buy more downloads of digital music, video and books, Brooks said. AOL does not release a breakdown of its subscribers by dial-up versus broadband, but Brooks said AOL's base of high-speed subscribers is believed to be below the estimated 400,000 counted by EarthLink. ''A lot of us are waiting to see an announcement on AOL's broadband subscriber figures,'' Brooks said. ''They've been pushing cable modems and nationwide DSL. That's where their future lies, in their ability to grow a broadband base.'' Broadband users tend to spend much more time online as well, Brooks said. On average a DSL or cable modem user spends two or three hours per day online, versus AOL's current daily usage of 70 minutes, Brooks said. ----------------------------------------------------------------------------- --- OnLine Holiday Sales May Outperform Offline by Beth Cox, eCommercenews It may have been a dismal holiday shopping season for many off-line merchants, but evidence is mounting that e-commerce sales exceeded some of the pre-Christmas forecasts, which would be welcome news for the Internet community. Giant Internet pure-play Amazon.com, (NASDAQ:AMZN) for instance, reported that it tallied more than 37.9 million items ordered as of midnight PST Dec. 21, although it added that such figures "should not be viewed or used as a predictor or indicator of revenue or other financial information..." Still, it's evidence of something, and it seems to be backed up by news from other companies. Microsoft Corp. (NASDAQ:MSFT) reported e-commerce holiday sales at its MSN.com portal rose 56 percent over last year, and Yahoo! Inc. (NASDAQ:YHOO) said Tuesday that holiday sales at its sites were up 86 percent. Comparison shopping operation BizRate.com said online sales during the weekend before Christmas were $345 million, up 73 percent from the same weekend last year. "The traffic to Amazon sites has accelerated well ahead of other commerce sites," Piper Jaffray analyst Safa Rashtchy wrote in a research note. And, the jump in traffic appears to be corresponding with overall sales volume, he added. In this its seventh holiday season, Amazon.com missed no chance to pat itself on the back a bit, saying in a press release that it again shipped well in excess of 99 percent of holiday orders in time to meet holiday deadlines -- including those placed by noon PST on Dec. 22. Of course, traffic and sales don't equal profits, and Amazon, for one, is expected to lose money again in its fourth quarter on a GAAP basis, even though the e-tailer has said it will likely report a pro forma profit. Fourth quarter results are due Jan. 22. A recent Goldman, Sachs advisory said "we are maintaining our estimate for $1.01 billion (in sales for the fourth quarter at Amazon), a 4 percent year-over-year increase (and) a significant slowdown from the 44 percent increase in the fourth quarter of 2000." Meanwhile, a new survey of "Internet Confidence" finds that the index is up slightly for the fourth quarter, another good sign for the e-commerce sector. Consumer attitudes towards e-commerce products and services indicate growing acceptance of online transactions, according to the Yahoo!/ACNielsen Internet Confidence Index. The index is a quarterly study designed to measure confidence levels in Internet products and services. Overall, the index continued an upward trend, rising one point over the special study fielded in early October. And once again, the travel category is a leader. Nearly two-thirds of all online shoppers polled said they have booked travel online. Of those participants, 37 percent said they prefer to book their travel via the Internet because they felt they could find better travel deals online. Travel makes up nearly 25 percent of e-commerce transactions, according to the National Retail Federation/Forrester Online Retail Index. Offline, 2001 will go down as one of the worst holiday sales seasons in a decade. The Redbook Retail Sales Average for year-over-year sales in the week ended Dec. 22 fell 0.6 percent, compared with a 1.1 percent year-on-year drop in the previous week, according to the weekly report by Instinet Research, a division of Instinet, a Reuters-owned electronic brokerage. Discount stores like Wal-Mart seemed to be among the exceptions as consumers, battered by recession and war worries, kept a tight grip on their wallets. ______________________________________________________________________ Dot Com death Toll Doubles in 2001, report says Michael Liedke, Association Press SAN FRANCISCO - The dot-com death toll doubled this year, with at least 537 Internet companies either going out of business or seeking refuge in bankruptcy court, according to statistics released Thursday. This year's casualties joined 225 dot-coms that perished during 2000, said Webmergers.com, a San Francisco-based deal maker that has tracked the rise and fall of the Internet economy. But the worst may be over. Only 21 Internet companies have failed in each of the past two months, the lowest mortality rate since 10 dot-coms failed in August 2000. The recent dropoff has prompted some observers to conclude that most dot-coms have already been wiped out, but Webmergers said that perception is wrong. The site estimates that 7,000 to 10,000 Internet companies remain in operation. That means the financial devastation of the past two years claimed no more than 10 percent of the sector, leaving behind a stronger - and possibly wiser - group of survivors. "To say that the decline in shutdowns is because there are no dot-coms left is a bit like saying a decline in rabies rates is due to the fact that all the dogs are dead," Webmergers said in its analysis. The dot-com wipeout triggered a tidal wave of layoffs, including cuts made by Internet companies trying to weather the storm by pruning expenses. Through November, dot-com companies had announced 98,522 layoffs, more than doubling the 41,515 firings made in 2000, according to Challenger, Gray & Christmas Inc., a job-locating firm in Chicago. The firm plans to announce year-end totals Monday. Dot-com layoffs also are tapering off. In November, Internet companies announced 2,901 job cuts, down dramatically from the peak of 17,554 layoffs announced in April. California, home to the technology-rich Silicon Valley, sustained the most dot-com damage. Since January 2000, 227 Internet companies based in California have closed or filed for bankruptcy, accounting for 30 percent of the nationwide total during that period, Webmergers said. New York, home to Silicon Alley, ranked next with 75 dot-com failures during the past two years. ------------------------------------------------------------------- Dot Com Death Doubles, But Not as Bad as ReportedVanessa Hua, San Francisco Chronicle Although the number of dot-com deaths more than doubled in 2001 compared to last year, the rate of Internet company shutdowns continues to slow. A study by Webmergers, a research and advisory service in San Francisco, showed that 21 online firms closed or declared bankruptcy last month. That holds steady with November's closures, and marks a decline from the summer months, when the monthly toll of failures hovered between 40 and 60. In 2001, 537 Internet companies imploded, compared with 225 the previous year. "The worst has run its course," said Tim Miller, president of Webmergers. "The weakest players have pretty much shaken out, while the remaining companies have had time to take evasive action." Yesterday's $436 million deal by Internet portal Yahoo to buy online recruitment service HotJobs is a sign that the industry is reviving, Miller said. Yahoo's cash bid muscled out TMP Worldwide's all-stock offer. Those who crashed took too long to realize that the funding environment had changed and did not alter their business model, seek a merger partner, or cut costs soon enough, Miller said. Webmergers monitors the Web, online databanks and other sources for its tally. The figures do not include faltering businesses that seek shelter by being acquired by other companies at fire sale prices. Other notable findings in the year-end report include: n California firms accounted for 29 percent, or 156 out of 537 Internet busts this year. n December's shutdowns are less than half of those in the same month a year ago; the month's figure is the lowest since August 2000. n n This year, the number of consumer Internet firm closures declined as the shakeout spread to business infrastructure companies. n Webmergers said Internet failures during the past two years represent, at most, 10 percent of online companies, based on an estimated 7,000 to 10,000 total dot-coms worldwide. The Internet downturn began in March 2000, when the plummetting stock market caused venture capital to dry up, and in turn triggered company closures. Much of the pain began in San Francisco, home to many e-commerce and content companies, and then spread over time to Internet infrastructure companies in Silicon Valley and beyond. A wave of shutdowns, sweeping from the end of 2000 through the first half of this year, accounted for 75 percent of Webmerger's two-year death toll. The rate of failure has tapered off, with only a handful of Internet companies blaming their demise on the lack of funding after the terrorist attacks of Sept. 11. "It was the bird poop on the cake, but not a major factor, " Miller said. The high profile flame-outs of 2001 include online grocer Webvan, Internet marketing firm Netcentives, Internet hosting service Exodus Communications, wireless service company Metricom, Internet consultant MarchFirst, and the Industry Standard, the glossy New Economy magazine. "It's like a tour through the mortuary," said Miller, recalling the dot-com departures. "I hope we remember every single one of them and take some lessons. But history is not an optimistic indicator that we will learn -- we haven't in the past." E-mail Vanessa Hua at vahua@sfchronicle.com. ----------------------------------------------------------------------------- Survey
Says: Consumer Confidence in Web Rises Consumers are more confident in the Web, according to the latest findings from a quarterly study conducted by Yahoo!(NASDAQ:YHOO) and market research giant ACNielsen. The study, which uses an index to calculate changing opinions, polled 1,000 consumers -- not necessarily Web users -- and found that consumers' confidence in the Internet has risen ten points since the last quarterly study in September, and one additional one point since October alone. Since the study's debut in June, 2001 with an index of 100, consumer confidence has risen to 115. As a result, the average U.S. consumer is more likely to take part in online auctions, purchasing on the Web, and handing over their information, including credit cards, than they were a year ago. Still, not all the findings are rosy. Thirteen percent fewer consumers say they're planning to shop online in first quarter, down from 60 percent -- a fact that's only partially offset by increases in the average online dollar spend from $219 in October to $226 in December. And according to the study, online spending will total nearly $15 billion in the first quarter of 2002, based on intent to purchase -- down almost $1 million from consumers' stated intent for the fourth quarter of 2001. Still, the companies say the increase could indicate a long-term change in consumers' attitudes toward the Web, even if current economic realities mean that less money is flowing online. For instance, even months after the Sept. 11, consumers' increasing confidence in the Web suggests its growing role in daily life in the future. In part, analysts say the trend is a result of the Sept. 11 terrorist attacks -- and the fact that people relied on the Internet for communications, news, donations, and potentially, to save time. Also crucial is that e-commerce firms are widely believed to have better delivered on their marketing promises than last year's holiday season when several e-tailers were stung by reports of poor customer service and late shipments. "Successful e-commerce businesses have been able to deliver products and services that truly add value to consumers' lives, making online transactions increasingly essential to our everyday activities," said Anke Audeneart, director global market research at Yahoo!. "Over the holiday season consumer savvy e-commerce platforms have remained committed to delivering positive online shopping experiences, which in turn have reinforced consumer confidence." Added ACNielsen International Research managing director Travyn Rhall, "Web retailers are becoming more and more accepted as part of the overall consumer shopping experience. It also demonstrates that Internet retailers are building loyal customer bases." ---------------------------------------------------------------------- Year-2001 Job Losses ----Back to When Boom Started By Associated Press, CHICAGO (AP) The United States is on pace to record more job losses in 2001 than it has in at least nine years, the job placement firm Challenger, Gray & Christmas said. Since the terrorist attacks on Sept. 11, U.S. companies have announced 624,411 job cuts, more than the 12-month totals for every year from 1993-1997, the job placement firm said. Through the end of November companies had announced close to 1.8 million job cuts in 2001, nearly three times more than were announced in 2000 and the largest number since Challenger began tabulating such figures in 1993. ''This year the downsizing just dwarfs anything we've seen before that,'' John Challenger, chief executive officer of the company that tracks employment trends, said Wednesday. The worst year prior to 2001 was 1998, when 677,795 job cuts were announced. The job losses cut across three significant economic sectors: manufacturing/industrial, high technology and travel, Challenger said. Challenger compiles figures from job cut announcements and does not count actual job losses, which can come from firings, early retirements and attrition. The telecommunications industry led the way with 292,756 planned cuts through November. Besides the struggling economy and the Sept. 11 attacks, Challenger pointed to two other trends that seem to have led to more layoffs: an increase in mergers in recent years and a ''frenzy of overhiring'' that occurred as the economy soared in the mid to late 1990s. Challenger said he has also been struck by the fact that even industry-leading companies are now downsizing. ------------------------------------------------------------------------- Apple Stores To Post a Loss ( no longer has Leasing Solution, San Jose--- is current lease plan to blame? ) BY GREG CHANG Bloomberg News Apple Computer, maker of the iMac personal computer, said its retail stores will have a loss in fiscal 2002, a setback to the company's plan to boost sales and profit by distancing itself from rivals. Apple opened 27 stores this year, two more than originally planned, the company said in a regulatory filing. The Cupertino-based PC maker said earlier that its retail operations would have a loss for the first quarter ending next week and become profitable for the year ending in September 2002. The U.S. economic recession and the September terrorist attacks are crimping PC sales, Apple said in the filing. The company opened its first retail store in May to attract new customers and distinguish its PCs from those running on Microsoft software, made by companies including Gateway, Hewlett-Packard and Compaq Computer. The company
made the original profit forecast in May, when there was ``a very different
outlook'' for the economy and the PC market, said Brett Miller, an analyst
with A.G. Edwards who rates Apple stock ``buy'' and doesn't own the
shares. ``Given the continued deterioration of the U.S. economy and aftereffects of Sept. 11, 2001, the company now expects its retail segment to suffer a small loss for the first quarter of 2002 and all of fiscal 2002,'' Apple said in a filing with the U.S. Securities and Exchange Commission. In the filing, Apple also said Chief Executive Officer Steve Jobs was paid $1 in annual salary, as he was for the past two years. He was granted no new options to buy Apple shares. During the year, Jobs also received a $43.5 million private jet and $40.5 million to cover taxes for the plane, a special bonus which was announced in January 2000. He received options for 20 million shares in 1999. The company issued options to buy 1 million shares to Chief Financial Officer Fred Anderson and Senior Vice Presidents Timothy Cook, Jonathan Rubinstein and Avadis Tevanian Jr. The options, which can be converted into stock at $16.81 a share, would be worth $26.8 million if the shares rise 10 percent annually for 10 years, the filing said. Anderson's salary was little changed at $657,039, while Rubenstein's rose 3.9 percent to $469,737. Tevanian's pay increased 2 percent to $460,873. Cook, who also was paid a bonus of $500,000, received a salary of $452,219, little changed from a year ago. Chevrolet
Avalanche is Motor Trend Truck of the Year DETROIT (AP) Despite some misgivings over its exterior appearance specifically, its plastic side cladding the editors of Motor Trend Magazine have chosen the Chevrolet Avalanche as its ''Truck of the Year.'' ''We looked past the styling because of the powertrain, smoothness of handling, good off-road performance in four-wheel drive,'' said Jack Keebler, Motor Trend Detroit bureau chief. ''It was such a fine mechanical piece.'' The Avalanche held off an all-domestic field of competitors which included the Lincoln Blackwood, Dodge Ram, GMC Sierra Denali, and Cadillac EXT. Along with its performance, the Avalanche's innovative ''midgate'' also helped create a margin of victory. ''It makes the truck really flexible,'' Keebler said. The midgate is a type of bulkhead that forms the rear of the passenger cabin. When the midgate is up, passengers can sit comfortably in a second row of seats. By lowering the midgate and folding down the second row seats, the load bed is lengthened from five feet to eight feet. The rear windshield can also be removed and stored inside the midgate to provide load space for taller cargo. ''Any vehicle manufacturer not considering it would be left out in the cold,'' Keebler said. Avalanche brand manager Ed Schoener said the midgate ''breaks through the typical paradigms'' of truck design, which, he said, is generally lacking in new innovations. The midgate, styling and powertrain have helped Avalanche steal customers away from other makes, Schoener said. About half of Avalanche sales are so-called ''conquest'' sales, he said. With a base price between $30,245 and $35,145, the Avalanche can be a little pricey for some buyers, but Schoener said about 70 percent of those who bought one already owned a full-sized sport utility vehicle or pickup truck, which are comparably priced. But the staff of Motor Trend said they didn't much care for the gray plastic side cladding on the Avalanche. ''The plastic was objectionable,'' Keebler said. That assessment surprised Schoener, who said internal research shows the vehicle's styling is one of the top reasons for attracting new buyers. ''We are having pretty good success selling it the way it is,'' Schoener said. But while Chevrolet wants to preserve the Avalanche's fundamental styling, Schoener said it may consider altering the two-tone look or offering a monochromatic design as an option. The Avalanche is also a finalist for North American Truck of the Year, competing against the Jeep Liberty and Chevrolet TrailBlazer. The winner will be announced Jan. 6 during the media preview days at the North American International Auto Show in Detroit. On the Net: Motor Trend
Magazine, http://www.motortrend.com Go 49ers!!!!!
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