Reno Gazette-Journal from Reno, Nevada • Page 8

8A Business Friday, February 18, 1983 Gazette-Journal British slash North Sea crude oil prices 1 0 percent expected about $2 to be trimmed from the current British oil benchmark price of $33.50 a barrel, but other reports had predicted a $3 cut per barrel. A barrel is about 42 gallons. The cut by British National Oil is the most significant price cut by a foreign oil producer since OPEC failed to agree on pricing and production at its emergency meeting in late January. That would put added pressure on OPEC producers to officially cut their prices. Besides Exxon and Mobil, Gulf Oil Sun Co.

Chevron, a unit of Standard Oil Co. of California, Atlantic Richfield Co. and Amoco, a unit of Standard Oil Co. (Indiana), matched the $l-a-barrel cut in the price they will pay for U.S. crude that was initiated by Texaco Inc.

earlier this week. It is the second time in less than a month that domestic refiners trimmed their buying prices by $1 per barrel. of the Organization of Petroleum Exporting Countries were planning to undercut the new North Sea crude oil price by 50 cents. The minister, whose remarks were reported by the Kuwaiti News Agency, did not identify the two OPEC members. The British National Oil Corp.

proposed dropping its price from $33.50 to $30.50 and the Norwegian state monopoly Statoil offered to cut its from $34.50 to $31.05 for crude loaded offshore and to $31.50 for crude loaded on shore. Sheik Ahmed Zaki Yamani of Saudi Arabia, the world's largest oil exporter, told a Saudi magazine last week, "I cannot see any way out of a price reduction." The Soviets already have cut the price of the oil they sell to European customers to about $29 a barrel, and some members of OPEC are reported selling below that price on the spot market. LONDON (AP) Britain and Norway today offered 10 percent cuts in the price of their North Sea crude oil. The move was expected to put more pressure on OPEC to cut its $34 base price to stay afloat in a glutted market. The decisions by Britain and Norway alone are expected to have little direct effect on retail gasoline prices in the United States because less than 15 percent of total U.S.

oil imports come from the North Sea. But analysts say the growing pressure on other major oil producers, such as Mexico and the 13 members of OPEC, to reduce their prices means the downward trend of gasoline and home heating oil prices should continue. Prices have been declining for months because of sagging demand and excess supplies. Kuwaiti oil minister Sheik Ali Al Khalifa said today that two members Britain is the world's fifth largest oil producer, with 2.2 million barrels a day coming from the North Sea. The new price, a cut of $3 from $33.50 a barrel, was proposed in telex messages sent to oil companies and customers.

The change, retroactive to Feb. 1, will become effective once the companies accept the recommendation. In the United States, meanwhile, more oil companies including industry leaders Exxon Corp. and Mobil Corp. joined other refiners in cutting by $1 a barrel the price they will pay for domestic crude oil.

In London, British Energy Department spokesman Stephen Chantrell confirmed the national corporation's price cut. He said crude oil is selling for around $30 a barrel elsewhere and said it was "nonsense" to suggest Britain was leading the market's downward move. Industry sources had said they I Net income for Holiday Inns declines $51 million in 1982 Holiday Inns the owner of Harrah's Reno and Tahoe, saw its net income drop $51 million in 1982, but it also got rid of its biggest money-loser. For its hotel-casinos, Harrah's Marina in Atlan- tic City, N.J., made an outstanding performance for the last three months of the year, the company said. The Marina and improvement at Harrah's Reno offset a loss at Harrah's Tahoe, resulting in an increase for gaming group operating income.

On Dec. 22, the company sold Delta Steamship Lines its shipping subsidiary. The Delta operation lost $21.1 million in the year. The company said the liner was the biggest reason for a drop to $76 million in net income for 1982, down $51 million from 1981. Revenues totaled $1.4 billion, up 5.4 percent.

Weaker auto bumpers under fire WASHINGTON (AP) Weaker automobile bumpers allowed last year by the government result in sharply higher auto repair costs and no apparent saving to car buyers, the insurance industry said Thursday. Tests conducted on five different models showed that the weaker bumpers, which are designed to withstand a 2.5 mph crash instead of a 5 mph crash, result in significantly greater damage to cars. In one 5 mph crash into a barrier at an angle with a Volvo GL, repair costs jumped from $143 to $745 with the weaker bumper, the industry said. lacocca sees GM-Toyota dangers NEW YORK (AP) Chrysler Corp. Chairman Lee lacocca says the proposed joint venture by automaking giants General Motors Corp.

and Toyota Motor Corp. could hurt smaller automakers, in the long run. "I think over time, it would hurt the rest of the competition and certainly hurt the marginal or the smallest producers like Chrysler and Ford and Volkswagen and other Toyota dealers," the outspoken Chrysler chairman said Thursday. Special trustee approved for Landmark CARSON CITY (AP) The Nevada Gaming Commission voted Thursday to let an Ohio lawyer act as special trustee for the Landmark hotel-casino in Las Vegas, taking over from bankrupt owner Zula Wolfram. The takeover by Patrick McGraw, a Toledo lawyer specializing in securities, stems from the forced liquidation of Bell and Beckwith, a Toledo brokerage firm controlled by Mrs.

Wolfram's husband, Edward. Harvester future is brighter CHICAGO (AP) International Harvester fortunes are tied to the economy and its "picture is brighter than last year at this time," the company's chief executive said. "We are a function of the economy," Donald D. Lennox, IH president and chief executive officer told reporters after addressing Harvester's annual stockholders meeting Thursday. "We see ourselves turning around" as the economy improves, he said.

But Lennox did not sell short Harvester's own efforts to climb from beneath last year's $1.64 billion avalanche of losses. Ford posts $657.8 million loss DETROIT (AP) Ford Motor Co. lost $657.8 million in 1982, largely because of setbacks in the automobile business in the United States and Canada, the company said Thursday. It was the third straight money-losing year for the No. 2 domestic automaker but still was an improvement from 1981.

The loss, amounting to $5.46 per share, compared with 1981's loss of $1.06 billion, or $8.81 per share. Money fund assets dip $2.6 billion NEW YORK (AP) Assets of the nation's 300 money market mutual funds fell $2.6 billion this past week, the 11th straight weekly decline, the Investment Company Institute said Thursday. The latest decline in the week ended Wednesday followed a $2.4 billion slide the previous week and dropped the funds' assets to $192.3 billion, the lowest level since they stood at $192.2 billion in the week ended May 5, 1982, according to the Washington-based mutual fund trade group. Phelps resumes copper operations GM, Toyota approve plan for U.S. plant FREMONT, Calif.

(AP) General Motors Corp. and Toyota Motor Corp. officials signed an agreement Thursday to make hundreds of thousands of front-wheel-drive cars together, a project that is expected to create 3,000 jobs at an idled GM plant. About 350 faid-off autoworkers, uncertain about their role in the new venture, had gathered at the plant, which was shut down a year ago by faltering demand for American cars. As the unemployed workers milled about, top officials of the two giant automakers predicted improved trade between the United States and Japan and widespread benefits for the troubled auto industry.

The president of the United Auto Workers union, which represents the laid-off workers, said later in Detroit that he had been assured by GM's chairman that the UAW would represent those hired at the new operation. Company officials, who have yet to discuss their agreement with UAW representatives, said the factory would produce 200,000 small, front-wheel-drive cars a year, starting late in 1984. The pact is expected to generate another 9,000 jobs in related industries throughout the United States, company officials say. fin AmImi ASSOCIATED PRESS PHOTO HISTORIC MOMENT: General Motors Chairman Roge Smith, left, and Toyota Chairman Fiji Toyoda exchange pens Thursday after signing their joint-venture Baldrige cautions recession not over By TIM ANDERSON and MARC SANI President Reagan says the recession is over, but Commerce Secretary Malcolm Baldrige said in Reno Thursday he isn't so sure. Baldrige, contradicting Reagan and others who believe the recession has ended, told reporters the nation's recovery is "beginning to take shape." He said he is encouraged by recent economic indicators and forecasts, but he cautioned more evidence is needed before the end of recession can be officially proclaimed.

"While some of the news has been very good lately, parts of our economy are still in a recession. The gradual process to lift us out of our economic slide is under way," Baldrige said. The 60-year-old Commerce chief carried the same message to more than 500 Washoe County Republicans who turned out to hear him speak at Harrah's Convention Center later in the day. "The recovery has clearly begun," he said, citing rises in housing starts, auto sales and steel production. But, he pointed out, if interest rates start to climb, the nation's economy will be in trouble once again.

Baldrige praised Reagan's tough approach to the economy and credited the administation's policies with bringing inflation rates to record lows. "This is a recovery without an increase in inflation," he said. While current predictions call for the inflation rate to hover at 5 percent, Baldrige predicted it would be slightly lower, bringing a murmur of approval from the audience. However, Baldrige after issuing a report on January home construction said on Wednesday the figures "add to the accumulating evidence that the 1981-82 recession is behind us." During his televised news conference Wednesday, Reagan put the recession in the past by saying "one of the most discouraging things about the recent recession was its duration." He has said for about a week that the recession is over, but aides have consistently said they aren't sure. Much of the president's new optimism was based on the government's report for January housing starts, up an "amazing" 35.9 percent over the previous month and 96 percent over January of 1982.

Also Wednesday, the government reported a hefty 0.9 percent increase in industrial production. More encouraging economic news surfaced Thursday. Factory use was up in January for the first time in a year, according to one government report. Another showed that fewer Americans are filing initial jobless claims. "Things are definitely looking up.

The president's program is working and it will continue to work if Congress goes along," Baldrige said. "The real question about how the economy is going to behave is the direction of interest rates. "If we can keep those rates down and continue to spur the economy with world's third-largest auto builder, suggested the plant might not hire back the union workers who lost their jobs when the plant closed on March 4, 1982. "This is an entirely new company that is being formed from now, and naturally it has no commitment to hire anyone at this stage," Toyoda said. "The memorandum of understanding is going to produce swift and far-ranging benefits," said Roger B.

Smith, chairman of GM, the world's largest auto company. "And to the extent that it helped improve trade relations between our two countries, it could produce international rewards as well." Eiji Toyoda, president of the Bank director says he was forced to resign LAS VEGAS Southern Nevada businessman Charles Ruthe said Thursday he has been forced to resign as a director of First Interstate Bank of Nevada because he is taking a more active role in a casino operation. Ruthe said he will attend his last board meeting of the state's largest bank next Wednesday. Bank officials later confirmed that Ruthe's resignation was based on his recently expanded executive duties with Sam's Town Casino. "Our bank has had a long-standing policy that board members cannot be actively involved in day-to-day gaming operations," said Ernie Martinelli, First Interstate's vice chairman of the board.

"Ruthe's decision to assume an active role with the casino was discussed. In line with our policy, it was mutually agreed that it might be best for him not to stand for reelection." Ruthe said he was told board members had "mixed feelings on changing the policy. Board members were polled and I was told the policy stands." Martinelli said board members were questioned, but he said he wasn't sure what the vote was to uphold bank policy. Please see RESIGNS, page 10A Golden Nugget buys second casino site in New Jersey out higher inflation, we'll have something to shout about." Baldrige said congressional approval of the administration's economic program would allow for the budget deficit to drop to 2 percent of the Gross National Product a figure he characterized as "workable." Please tee BALDRIGE, page 10A ATLANTIC CITY, N.J. (AP) Golden Nugget which spent $25 million to buy property owned by MGM Grand Hotels Inc.

in the city's marina section, will erect a casino hotel on the site, officials announced. The 14.7-acre site, sold to Golden Nugget Thursday, is located across the street from Harrah's Marina Casino Hotel. The sale means MGM Grand temporarily was pulling out of casino development here. Lance Walter, an official with LAM Walter Co. of Los Angeles, which handled the transaction for Golden Nugget, confirmed there were plans to build a casino on the plot.

But Golden Nugget officials could not be reached to comment on whether they planned to abandon a previous proposal to build a casino hotel on the 18-acre, former Two Guys site at the south end of the city. In theory, Golden Nugget could build on each site because the Casino Control Act allows developers to hold licenses for three casino hotels here. In another development Thursday, MGM Grand purchased two small parcels of casino-zoned property near the land it sold to Golden Nugget. But that land will become the property of Hilton Hotels under an agreement between those two firms, said MGM Grand Corporate Counsel Bernard Seglin. Phelps Dodge suspended most Arizona operations April 17, 1982.

Copper concentrate from Ajo is to be sent by rail to the company's Hidalgo Smelter in New Mexico, he said. T-Dills coming duo? PHOENIX, Ariz. (AP) Phelps Dodge Co. said Thursday it was resuming operations at its Ajo mine on Feb. 28, recalling 600 workers, because of increased demand for copper.

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