The Times from Munster, Indiana • 258

PAGE E4 FRIDAY JUNE 3 2005 EAPT THE TIMES www.nwitimes.com Factory orders post gams healthy Labor costs rise sharply productivity also up BY MARTIN CRUTSINGER AP Economics Writer WASHINGTON Orders to U.S. factories advanced by 0.9 percent in April, the fastest clip in five months, while worker productivity at the start of the year was better than originally thought and the nation's retailers enjoyed strong sales despite a cold spring. But all the economic news released Thursday wasn't good. Labor costs, a key factor influencing inflation rates, rose sharply over the past six months. The Commerce Department said factory orders rose by 0.9 percent in April as demand for durable goods posted a solid 1.9 percent gain, the first increase in four months, Jed by strength in demand for autos and aircraft.

Those gains offset a 0.2 percent decline in orders for nondurable goods, items not expected to last three years. Meanwhile, the Labor Department reported that productivity went up at an annual rate of 2.9 percent in the first quarter, revised upward from an originally reported gain of 2.6 percent. However, the cost of labor per unit of output jumped at an annual rate of 3.3 percent. That followed a revised increase of 7.7 percent in labor costs in the fourth quarter, which was the biggest surge in more than four years. "This is seriously bad news for the Fed costs appear to be spiral-ing rapidly and it strongly argues for substantially higher interest rates," said Ian Shepherdson, chief U.S.

economist at High Frequency Economics. But other analysts were not as concerned, noting that the big fourth quarter surge reflected end-of-the-year bonuses that should not trigger widespread wage pressures. "The one-time nature of the payouts suggests that there is little inflationary implication from these numbers," said Merrill Lynch economist Sheryl King. In other economic news Thursday, the nation's retailers reported generally upbeat sales figures for May with luxury stores such as Nordstrom Inc. and teen retailers including Bebe Stores Inc.

among the big winners. And in a final report, the Labor Department said the number of Americans filing new claims for unemployment benefits shot up by 25,000 last week, the biggest week- ly increase in 14 months. Labor Department analysts blamed the increase, which pushed total claims to 350,000 last week, on temporary layoffs in the auto industry. Wall Street had a muted reaction to all the economic news with the Dow Jones industrial average with the Dow Jones industrial average down about 13 points in afternoon trading. While the jump in jobless claims was the biggest one-week gain since late January 2004, analysts noted the temporary nature of the auto layoffs and said they were still looking for solid gains in employment going forward.

They predicted Friday's jobless report would show the unemployment rate holding steady at 5.2 percent with a solid 180,000 new jobs created last month. GM Blade wars cut names joint venture deep 1 Tiff ITTIMIU JOHN TODD THE ASSOCIATED PRESS Greg Raleigh, founder of Airgo Networks, holds two wireless routers in his hands which use the technology he discovered in a testing chamber at the Airgo Networks offices in Palo Alto, Calif. A Wi-Fi makeover Plant in eastern city of Qingdao BY ELAINE KURTENBACH AP Business Writer SHANGHAI General Motors the world's biggest automaker, said Thursday its joint venture in China has agreed to take over a former automobile plant in Qingdao to increase production of mini-vehicles. The SAIC-GM-Wuling Automobile Co. joint venture will purchase Etsong (Qingdao) Vehicle Manufacturing which ceased production several years ago, with operations due to begin in the second half of this year, GM said in a statement.

The new plant will i have an annual production capacity of 60,000 to 70,000 units, it said. The new company will be called SAIC-GM-Wuling Automobile Co. Ltd. Qingdao Branch Co. and will be a wholly owned subsidiary of SAIC-GM-Wuling, itsaid.

Detroit-based GMT said it will shift some production of its commercial models from SAIC-GM-Wuling's main factory in Liuzhou, in southwest China's Guangxi region, to Qingdao when the factory goes online later this year. SAIC-GM-Wuling, China's biggest maker of mini-vehicles, makes Wuling brand mini-trucks and minivans and the Chevrolet Spark mini-car. GM owns a 34 percent stake in the joint venture company, which has the capacity to roll out up to 300,000 vehicles per year and is struggling to keep up with demand, GM officials say. GM and other major automakers have been ramping up production of smaller cars to meet rising demand from individual Chinese for economy models. "Mini-vehicles account for more than 25 percent of all vehicles sold in China and remain one of the fastest-growing market segments," said Kevin Wale, president and managing director of the GM China Group.

With mini-car sales forecast to surpass 1 million units this year, the expansion was vital for meet- ing demand, Wale said. GM officials said that setting up a production base in Qingdao, a city on China's eastern coast north of Shanghai, also would help reduce transportation costs and increase efficiency. GM also announced that it has broken ground on a 3.2 billion yuan ($387 million) new engine plant next to its factory in Liuzhou. When completed in 2007, he factory will have the capacity' to make 300,000 engines a year. Etsong Vehicle, a car company founded in 1997 by the Qingdao-based Etsong Tobacco (Group) Co.

and two other Qingdao companies, briefly made cars based on the Rover-designed Austin Maestro that sold as the Lubao, but later sold the rights to that model to another Chinese automaker, the FAW Group. Win for Schick as judge rules Gillette ads are false ST. LOUIS Gillette Co. ads claiming its M3Power razor raises hair up and away from the skin are "unsubstantiated and inaccurate," a federal judge said in siding with Gillette's chief competitor, Schick-Wilkinson Sword. U.S.

District Judge Janet C. Hall in Connecticut granted Schick a preliminary injunction prohibiting the use of the television and print ads. Gillette was also ordered to change packaging for the product and remove in-store displays that feature the false claims. Wednesday's ruling' said the depiction in Gillette advertising was "greatly exaggerated" and "literally false." Gillette spokeswoman Michele Szynal said the company has not decided whether to appeal. "Right now the ruling won't have any affect on our marketing since the visuals don't appear on any (current) advertising or point-of-sales material," she said.

The M3Power, a high-tech, vibrating men's razor introduced early last year to compete with Schick's Quattro razor, held a 20 percent global share last quarter and was the world's top-selling razor, Boston-based Gillette said. Schick is a division of St. Louis-based Energizer Holdings and is the world's second-largest maker of wet shave products behind Gillette. Schick-Wilkinson Sword president Joe Lynch said Gillette's claims for the M3Power "go well beyond the capabilities of the products. "We firmly believe that since the day the M3Power was launched a year ago, Gillette has deceived consumers about the performance of this product," Lynch said.

But Szynal said the computer-generated image of the razor lifting hair away from the skin was never meant to be taken literally. The two razor makers have tangled in court before, including a long patent fight over whether Schick's four-bladed Quattro and Quattro for Women razors violate Gillette's patent for a multi-blade system. Gillette has claimed that any razor head with three or more blades would be covered by its patent. In April, a federal appeals court told a lower court to reconsider its decision allowing Energizer to continue selling the Quattro razor while the patent dispute plays out. Gillette shares fell 48 cents to $53.30 in late morning trading on the New York Stock Exchange, still near the top of the 52-week range of $37.77 to $54.33.

Energizer shares on the NYSE fell 4 cents to $64.03, near the high end of the 52-week range of $37.10 to $64.15. AP ON THE WEB Gillette: www.gillette.com Energizerwww.energizer.com an analyst at the research firm Gartner Inc. "They walk into these technology emporiums and they're just snowed under by all this stuff that doesn't mean Meanwhile, equipment and chip makers are accusing each other of stealing names, breaking standards and causing interference with existing Wi-Fi networks. The companies also report that rivals' gear doesn't work well with equipment based on existing stan- dards though independent reviews indicate interoperability at least in slower modes. The Wi-Fi Alliance, an industry group that certifies wireless products to ensure they work together, refuses to review any products for 802.11n interoperability until there's actually a standard approved by the Institute of Electrical and Electronics Engineers.

"We just feel that there are too many moving parts," said Frank Hanzlik, the alliance's managing director. Currently, two draft proposals are battling it out before the IEEE. At a meeting last month in Australia, one of the proposals failed to get enough votes to become the draft standard. Much of the controversy surrounds an advance called MIMO, an acronym for "Multiple Input, Multiple Output," which refers to the use of sever- al antennas to improve overall wireless performance. It's a major part of both 802.11n proposals under consideration.

In that definition, multiple antennas and radios are used to send different streams simulta Networking companies jump on wireless standard SAN JOSE, CALIF. The technology behind wireless data networks in homes and businesses is on the verge of a makeover that promises to fix long-standing complaints of spotty coverage, flaky connections and inconsistent speeds. The next generation of Wi-Fi will be so powerful that it's expected to be capable of carrying everything from Internet phone calls and music to definition television streams over the airwaves without a hiccup. Problem is, the standard technically known as 802.11n does not yet exist. Not even a draft has been approved.

In fact, the final 802.11n specifications aren't expected to receive an official nd until late next year at the earliest. But that has not stopped the makers of access points, networking cards and other wireless gear from launching a parade of products that claim the benefits and even the underlying technologies of the still-to-be-defined 802.11n. The situation is setting a new standard for market confusion even in an industry that plasters its boxes with claims of unobtainable speeds, fuzzy math and a dizzying collection of acronyms. Some products are labeled "Pre which some believe might lead consumers to think the equipment is upgradeable to actual 802.11n: "It's misleading the poor consumers," said Ken Dulaney, neously on the same data channel. At the receiving end, antennas pick up the signal, which is then deciphered.

The result is an increase in range and data rate. The technology was pioneered by the Palo Alto startup Airgo Networks which now supplies the chips for the latest equipment from Cisco Systems Inc's Linksys division and Belkin among others. Airgo's CEO, Greg Raleigh, wrote papers describing it as far back as the mid-1990s while a student at Stanford University. But now, he says other companies are trying to derail his company's momentum and confuse consumers by using MIMO to describe other technologies. "There's been a lot of impostor technology that's piggybacked on the MIMO bandwagi on," he said.

Atheros Communications a larger maker of wireless networking chips, uses a much broader definition. "What (MIMO) refers to is. any wireless system that has multiple antennas at both ends of the connection," said Craig Barratt, Atheros' chief execu- tive. "The way in which those antennas can be used is quite Atheros' MIMO, found in 6ome D-Link' Corp. gear, extends the range of a wireless signal by transmitting the same stream of data over multiple" antennas.

Video54's flavor also uses multiple antennas but relies on software to instantly alter their configuration to improve the signal. AP.