Archive for the ‘Economic development’ Category

Toyota reports February sales

March 2nd, 2010 No comments

Toyota has just released its sales figures for the month of February. There is some good and bad in the numbers.

The bad:

Overall sales of Toyotas — excluding Lexus and Scion — for February came in at100,027 vehicles. That represents a decrease of 8.7 percent from last February.

The Corolla compact and the mid-size Camry and Camry Hybrid were the company’s best-sellers last month. About 17,000 new Corollas rolled off car lots; the Camry and Camry Hybrid combined to sell about 16,500 units.

To go with the foundering automotive market, Toyota had to expect some sales-related fallout from the recall mess the company has been fighting since the calendar turned to 2010. Both General Motors and Ford earlier today posted strong showings for February. Ford sales increased a whopping 43 percent; GM’s jumped 12 percent.

The good news is that Lexus sales were up 4.5 percent in February 2010, compared with February 2009. The Tacoma mid-size pickup also saw its sales jump almost 6 percent.

What’s even better for Mississippi, where the company maintains it will eventually build the Prius Hybrid, is that sales of the vehicle this past February (7,968 units) were up 10.2 percent from the same period last year.

You can view the entire sales breakdown here.

Bryant: Barbour’s veto will be sustained

February 24th, 2010 No comments

Gov. Haley Barbour earlier today vetoed Senate Bill 2688, a bill that would have restored money to some agencies after budget cuts, because he said in a press release that “it spent too much of the state’s reserves and ineffectively divided funds among several agencies. This legislation would virtually guarantee higher taxes within a few years,” Barbour said of the bill’s use of one-time money to fund recurring expenses .

Specifically, Barbour said the bill spent too much of the Health Care Trust Fund and the state’s rainy day fund to fill some of the gaps left by budget cuts, which have totaled more than $400 million since the fiscal year started last July.

Barbour had signaled his intentions to veto the bill almost from the moment it cleared both chambers of the Capitol about a week ago. There had been some strong indications that Barbour’s perfect veto record would acquire its first blemish once the legislation headed back to the House and Senate.

Lt. Gov. Phil Bryant, in a statement released about 10 minutes ago, doused cold water on that notion.

“It is my intent to sustain the Governor’s veto and immediately move on SB 2495,” Bryant said. “This bipartisan compromise allocates nearly $40 million to restore cuts made to education. It also places a total of $16 million, including $14 million that we did not anticipate receiving, to the Department of Corrections. In all, SB 2495 restores $82 million of cuts made to state agencies for FY 10. I will continue to work with the Governor and the House leadership to reach a fair and reasonable solution without compromising the state’s savings account.”

Obviously, if enough senators vote to override Barbour’s veto, Bryant’s plan will fail. With the House all but certain to override Barbour’s veto, it will be up to Bryant to muster enough votes in the Senate to sustain it.

Barbour’s undefeated veto record has come close to entering the realm of political legend. Magnolia Marketplace will never forget Barbour’s veto last session of a bill that would have eliminated the use of eminent domain for economic development projects. The bill originally cleared the Senate 52-0. His veto was sustained with a handful of votes to spare.

“That’s the damndest thing,” said Marty Wiseman, director of the Stennis Institute, shortly afterward the Senate sustained the veto.

It sure was.

Toyota idling two plants, and a little housekeeping

February 16th, 2010 No comments

Toyota announced today that it will idle two of its manufacturing facilities — one in Texas, the other in Kentucky — as the fallout from the recalls spreads. The plant in Texas, which makes the Tundra truck, will shut down for one week in March and one week in April. The facility in Kentucky, where Toyota builds the Camry and Avalon sedans and the Venza crossover, will idle Feb. 26 and possibly two or three more days in March or April,a spokesman told the Associated Press.

That doesn’t make much of an impact here in Mississippi, but I have a story in this week’s edition of the MBJ that takes a look at how the recalls — which added the Prius about 10 days ago — might affect the Blue Springs plant, which supposedly will build the Prius, though nobody really knows when production will start. Be sure to check it out.

Anyway, there remain a few notes from that story that didn’t really fit with the overall theme of the final draft, but are still worth mentioning:

Michelle Krebs, senior analyst at, had an interesting take on how Toyota is handling the public relations boondoggle the recalls have created. A lot of folks have said that Toyota was slow to react, and when it did, did not do that great a job. That may be due to a couple things, Krebs said. The first is that there apparently was no established blueprint  to start putting out the fires immediately after they started. Krebs’ second theory goes to the Japanese culture.

“I would think that any major corporation of any sort would have a crisis management plan ready to enact at any moment,” she said. “You would think they would practice some of these scenarios. I think it’s definitely a lack of experience. If you look at the Japanese culture, the companies are revered. They don’t have a lot of lawyers. They don’t have the scrutiny of the media like we do here. And frankly, I think Toyota got arrogant and got complacent.”

Mark Ragsdale, a former dealership owner who now serves as a consultant to the automotive industry, said Toyota put too much of the PR burden on its dealers, which runs counter to the reputation it has enjoyed among its individual franchises.

“Toyota always is in the top two or three in dealer-relations surveys,” Ragsdale said. “But automakers are their own breed of cat. They’re not real big on taking responsibility. The automakers use dealers as human shields to get in front of the customer and handle things, but dealers don’t always have the tools to do that.”

Toyota makes Prius recall official

February 9th, 2010 No comments

Toyota announced late last night it is recalling 133,000 2010 Prius hybrids to fix problems associated with the antilock braking system software. Also included in the recall are 14,500 2010 Lexus HS 250h models.

Toyota said in a press release that some Prius and 250h owners have experienced “inconsistent brake feel during slow and steady application of brakes on rough or slick road surfaces when the ABS is activated in an effort to maintain tire traction.”

Obviously, the Prius is near and dear to the heart of Mississippi’s business community, with the facility in Blue Springs on tap to eventually build the vehicle. Magnolia Marketplace is working on a story for next week’s MBJ about how the recall mess will (or won’t) affect the goings-on in North Mississippi. Look for it.

UPDATED AT 10 A.M.: Meant to include a link to the Toyota press release, which is here.

Spokeswoman: Prius recall not yet official

February 5th, 2010 No comments

We just got off the phone with Toyota Motor Manufacturing North America Spokeswoman Barbara McDaniel. Here’s the full transcript of our brief conversation.

Magnolia Marketplace: “Has anything become official with the Prius recall?”

McDaniel: “No, there’s nothing official. We’re still investigating.”

Magnolia Marketplace: “I’m contractually obligated to ask this question, but will this have any effect on the Blue Springs facility?”

McDaniel: “No.”

So there you have it. Gov. Haley Barbour is holding a press conference at 11 a.m. to announce yet another round of budget cuts, but we’ll try to sneak in a question about Toyota and see what he thinks.

UPDATED AT 9:36 A.M.: Barbour’s office has just issued a press release announcing the press conference at 11 has been canceled so Barbour can “continue to analyze budget options.”

Spokeswoman: Toyota recall will have no bearing on Blue Springs plans

February 2nd, 2010 No comments

Toyota, which has long been considered the gold standard for automotive companies, has taken a substantial hit lately with its recall related to gas pedals sticking to the floor, causing sudden and unintended acceleration. (“Sudden unintended acceleration” — now that sounds scary.)

Anyway, most of the media coverage has focused on how the company will rebound from having to suspend sales of eight of its models, including the Camry, traditionally one of its best sellers.

What the recall will not touch is Toyota’s plans for Blue Springs, according to spokeswoman Barbara McDaniel. “Totally unrelated” is how McDaniel characterized the recall and the question of when the facility in North Mississippi will start production.

Not included in the gas pedal recall is the hybrid Prius, the vehicle Toyota plans to build in Blue Springs whenever it decides to open it.

In legislative news, today marks a major deadline. Bills that aren’t sent out of their committees by midnight tonight will die. Magnolia Marketplace is working on a story for next week’s MBJ that takes a look at what died and what survived that is of interest to the business community. Look for it.

Stennis format changes a bit

January 25th, 2010 No comments

Gov. Haley Barbour was the keynote for today’s monthly luncheon meeting of the Stennis Capitol Press Corps in Jackson. Usually, speakers offer a 20- to 30-minute presentation before taking a few questions from the audience.

Barbour took the podium and started taking questions immediately. It was a nice change.

Anyway, Barbour didn’t say a whole lot that he didn’t say Friday, when he announced that he was making the third round of cuts to the state’s budget.

He did say that he thought “the vast majority of school districts will be fine” financially after the the latest round of cuts brought the total dollars shaved from the Mississippi Adequate Education Program to $170 million for fiscal year 2010. State Superintendent of Education Dr. Tom Burnham said Friday afternoon that the cuts would “devastate” the state’s public education system. School districts will have to lean heavily on their reserves, Barbour said, to make it to the end of the budget  year. Included in Barbour’s executive budget recommendation is a $35 million set aside to assist those districts whose reserves are not as deep as others.

Barbour also repeated a line he has used frequently the past couple months, that he thinks Mississippi will emerge from the national recession quicker than other states because of the proliferation of high-tech manufacturing jobs from projects like Severstal in Columbus and the GE Aviation plant in Batesville. His commission to study school consolidation is scheduled to release its findings in a report on April 1, which is too late for that issue to be considered in the regular session. Barbour said it’s likely a special session would be needed to tackle it. That, of course, is assuming lawmakers are able to craft a budget for FY2011 by the end of March, which is far from guaranteed.

Barbour, who serves as chairman of the Republican Governors Association, also talked some national politics. He called Republican Scott Brown’s victory in Massachusetts for the right to fill Ted Kennedy’s old U.S. Senate seat “volcanic” and said it had changed the GOP’s playbook for 2010 and beyond, with candidate recruitment increasing in some places that have traditionally been hostile to Republicans. The RGA, Barbour said, has $25 million to spend on elections in 2010, which is a record amount.

Barbour thinks this political environment is more favorable to Republicans than it was in 1994, when Barbour was head of the National Republican Committee and engineered the GOP takeover of the U.S. House and Senate.

“There’s a lot of energy on our side,” Barbour said.

Barbour also had a pretty interesting take on the U.S. Supreme Court’s decision to strike down a 20-year-old law that prohibited corporations and unions from spending money on political advertising. Magnolia Marketplace is working on a story about that for next week’s MBJ, and Barbour’s thoughts on the matter will pepper it pretty heavily. Look for it.

Barbour hashes it out with business leaders

January 7th, 2010 No comments

Gov. Haley Barbour just wrapped a two-hour roundtable with about 30 members of the state’s business community. There bankers, business owners, trade group and association executives and two or three legislators. Barbour had called them all into his Capitol office to get their ideas on how to spur economic development and job creation.

The majority of the time, Barbour said a lot of the things he said earlier today at the MEC’s A Capital Day: no new taxes, job creation is his most important function as the state’s chief executive, state revenue is not recovering anytime soon, and the budget process this session isn’t going to be easy, which is why the lawmakers should grant him the authority to cut the budget by 10 percent instead of only 5 percent without their approval.

What was new was Barbour mentioning the possibility of the state guaranteeing portions (maybe 25 percent) of some small business loans — loans that banks would have made two years ago, but now are stuck because of the credit markets. The state guaranteeing maybe a fourth of the loan’s total might be enough for a bank to go ahead and approve it. Such a plan would be designed to make it easier for small businesses to borrow money. Barbour got mixed reactions from some of the financial folks in the crowd.

Barbour stressed that this proposal was in the very early stages, but did say that he expected an up or down vote on it before the legislative session concludes in late March (or April, May or June). He also said he was “not looking for another beef plant” and that the risk to taxpayers’ money had to be weighed carefully, and duplication of existing U.S. Small Business Administration programs had to be avoided.

This will certainly be something to watch as the session moves forward. I’ll be anxious to see how some key lawmakers receive this news. For now, though, the temperature is dropping and there’s rain on the streets. Time to head home. See you tomorrow.

Barbour, business and budgets

January 6th, 2010 No comments

Gov. Haley Barbour will sit down with some of the state’s business leaders Thursday afternoon at 1 to discuss economic development, job creation, what needs to happen in the legislative session to spur each of those things, and the state’s budget.

The meeting is open to the media, so Magnolia Marketplace will be there. We’ll have the details as soon as it wraps.

Also, Treasurer Tate Reeves just issued a press release that deals with the budget, and like every budget item the past few months, the news is less than rosy.

The budget for fiscal year 2011, which lawmakers will adopt before adjourning the session in March (or April or May or June), was already expected to have a deficit exceeding $700 billion. Reeves said today that, because an annual payment from tobacco companies based on tobacco usage nationally is some $8 million less than what it was last year, the deficit will be even larger.

Barbour’s executive budget recommendation and the Joint Legislative Budget Committee’s plan counted on plugging some of the holes with $115 million from the Health Care Expendable Fund. Problem is, the HCEF got nearly $118 million from tobacco companies last December; this December, the state got only $109.7 million.

So just add that to the pile of things lawmakers will have to work around when dealing with the budget this session. Pretty soon, the pile will be as big (and just as smelly) as one you’d find in a cow pasture.

Incentive legislation tops agenda as session starts

January 5th, 2010 No comments

Gov. Haley Barbour announced yesterday that Wilh. Schulz GMBH will build a $300 million facility in Tunica to manufacture the latest generation of steel pipes used for natural gas and oil distribution. We have a story with the details on the Web site.

The state will issue $15 million in bonds to help the company purchase equipment for the project. Legislation authorizing just that is expected to be among the first things lawmakers do once the 2010 session gavels open at noon today.

Magnolia Marketplace just talked with a couple folks over at the Capitol who expect the legislation to move quickly, and for it possibly to reach Barbour’s desk this afternoon. With all the budget haranguing coming down the pike, lawmakers probably wish everything was this easy.