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Archive for Wednesday, June 6, 2001

Business Briefcase

June 6, 2001

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Economy: Productivity falls

American workers' productivity, a key ingredient to economic prosperity, posted its worst quarterly showing since 1993 during the first three months of the year.

The Labor Department reported Tuesday that productivity the amount of goods and services produced for each hour worked declined at a seasonally adjusted annual rate of 1.2 percent in the January-March quarter.

The revised first-quarter productivity performance showed a sharper decline than the 0.1 percent rate of decrease the government previously reported. The previous record: a 5 percent drop in the first quarter of 1993.

Internet: Amazon.com aims for profitability

Amazon.com will sell personal computers online and market books to institutional buyers including businesses and government agencies later this year, company executives said Tuesday.

Chief Financial Officer Warren Jenson reaffirmed that the online retailer was aiming for pro forma operating profitability which excludes costs such as losses from investments and stock options in the fourth quarter of this year.

The Seattle-based online retailer has been in business since 1995, but has yet to turn a profit.

Automaker: GM gives shareholders update on Hughes deal

The head of General Motors Corp. told shareholders that negotiations of a sale of the company's Hughes Electronics unit to Rupert Murdoch's News Corp. are a priority, but the automaker continues to consider other options.

GM president and CEO Rick Wagoner said Tuesday that there had been "a lot of progress but some issues still need to be worked out."

Wagoner said that the world's largest automaker remained open to proposals from others, such as EchoStar.

Appliances: Maytag buys rival

Home appliance giant Maytag Corp. is buying rival Amana Appliances for $325 million in a cash-and-stock deal that would shore up Maytag's lineup of refrigeration products.

The deal announced Tuesday to buy Amana from Goodman Global Holding Co., a family owned company in Houston, Tex., is subject to regulatory approval. It is expected to close in the third quarter.

Included in the agreement are Amana's major appliance and commercial microwave oven businesses that should boost Maytag's annual sales by $900 million. Amana's heating and air-conditioning businesses are not included.

Auto industry: Ford expands recall of Firestone tires

Ford Motor Company Co. expanded its tire recall to Europe on Tuesday with plans to replace Firestone tires on about 23,000 vehicles across the continent.

The world's second largest automaker earlier had said that no European vehicles would be affected by the massive recall effort in the United States, where 13 million Firestone Wilderness AT tires are being recalled.

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