BUSINESS BRIEFS
Consumer borrowing slides 3.1% in December
Advertiser News Services
WASHINGTON — Consumer borrowing fell for a third straight month in December, the longest stretch in 17 years, as households cut spending amid a steep recession and rising job layoffs.
The Federal Reserve said yesterday that consumer borrowing dropped at an annual rate of 3.1 percent in December. The $6.6 billion decline was nearly double what analysts expected. It followed an $11 billion drop in November that was the biggest monthly plunge on record going back to 1943.
The weakness in December reflected a big 7.8 percent decline in the category that includes credit card debt, and a 0.2 percent drop in the category that includes auto loans.
OIL PRICES DROP BELOW $41 A BARREL
NEW YORK — Oil prices sank below $41 a barrel yesterday as the government reported that U.S. employers slashed more than a half million jobs last month, the most in 35 years.Light, sweet crude for March delivery dropped a dollar to settle at $40.17 a barrel on the New York Mercantile Exchange. Retail gas prices rose to almost $2 a gallon as refineries took units temporarily off-line for seasonal maintenance.
Oil traders see layoffs as an instant drag on oil demand. People have less need for gasoline when they no longer have a daily commute. They also stop buying toys, nonstick pans, raincoats and millions of other products that are made with petroleum.
DELPHI WANTS TO END HEALTHCARE AID
DETROIT — Troubled auto parts supplier Delphi Corp. has asked a bankruptcy judge to allow it to cancel healthcare and life insurance benefits for current and future salaried retirees, citing the steep downturn in the overall auto industry in recent months.The request filed Wednesday with U.S. Bankruptcy Court in New York seeks to cut those benefits to 15,000 salaried retirees as soon as April 1. The Troy, Mich.-based company said the moves would save about $70 million annually, or $200 million through 2011.
Cutting the benefits also would allow Delphi to reduce its balance sheet liabilities by $1.1 billion, the company said.
Shedding that liability is expected to help the company attract the financing it needs to leave bankruptcy protection.
TOYOTA EXPECTS RARE ANNUAL LOSS
TOKYO — Toyota forecast its first annual loss since 1950 yesterday as plunging demand for cars, especially in the U.S., and the strong yen pummeled earnings at the world's No. 1 automaker.Toyota Motor Corp. reported a 164.7 billion yen ($1.8 billion) loss for the October-December quarter, down sharply from the 458.6 billion yen profit for the same period the previous year.
Quarterly sales plunged 28.4 percent to 4.8 trillion yen.
Joining a string of Japanese companies that are now expecting to slide into the red for the year, Toyota said it expects a loss of 350 billion yen ($3.85 billion) for the fiscal year through March — a stunning reversal from the record 1.72 trillion yen profit it posted the previous year.
WEYERHAEUSER HIT HARD LAST QUARTER
NEW YORK — Weyerhaeuser Co. said yesterday its fourth-quarter loss ballooned to more than $1 billion as the rapidly deteriorating U.S. housing market forced the timber and wood products company to book a massive charge and write down other assets.The Federal Way, Wash.-based company, which builds houses and makes pulp and wood panels from trees it grows on more than 6 million acres, is facing its most challenging environment in a generation.
The company's loss amounted to $5.73 per share in the three months ended Dec. 31. It reported a loss of $63 million, or 30 cents per share, in the year-earlier period.
"These results reflect the speed and severity of the deterioration of market conditions," Weyerhaeuser Chief Executive Dan Fulton said.
