The Journal Times from Racine, Wisconsin • 19

U.S. may soften fuel economy rules WASHINGTON, (AP) Saying consumers should decide the, fuel efficiency of new cars, the Reagan administration Is hinting it may roll back automobile fuef economy standards next month. i Ford Motor Co. and General Motors Corp. have asked the National Highway Traffic Safety Administration to reduce the fleet-wide fuel economy requirements from 27.8 to 26 miles per gallon.

The automakers say they will be unable to meet the higher standard next year because consumers are buying more large cars. Supporters of the higher standard argue that lowering the requirement could barm the country's energy conservation effort. If the standard is not met, Ford and GM could face substantial fines up to $400 million for GM and about $80 million for Ford or be forced to offer fewer large cars to consumers who Increasingly are demanding them. Diane Steed, NHTSA administrator, told a. Senate subcommittee Tuesday no decision has been made on the Ford and QM requests, but she acknowledged "a number of factors have changed" since the standard was imposed.

"It is the administration's position that free-market factors, rather than (the government) standards are the most efficient means of achieving appropriate level of fuel economy over the long run," she said at another point. Suggestions that competitive forces could replace the government imposed standards brought sharp criticism from Sen. Jay Rockefeller, who said be was distressed at the administration's "extraordinary commitment to ideology" on the issue. Sen. Howard Metzenbaum, D-Ohio, called the proposed lowering of the fuel economy requirements "an absurdity" and an abandonment of a key element of the country's fuel conservation program when no one knows how oil supplies might fluctuate.

The fuel economy standards were Imposed after the 1973 Arab oil embargo to push U.S. automakers into producing more fuel-efficient cars. The standards require each manufacturers' fleet of cars to average at least 17.5 miles per gallon beginning this year. Under the law, NHTSA may, however, lower or raise the ceiling for subsequent model years. For years, the automakers had little trouble meeting the gradually Increasing standard be-! cause small, more fuel-efficient cars were in demand.

With the demand for fuel-efficient vehicles Increasing, many rruuiufac-" hirers have said they would not be able to meet, the standard with the 1906 models scheduled to. come out this fall. According to NHTSA figures, the automakers that will be unable to meet the 27.5 mpg standard for 1906 are Ford, GM, BMW, Mercedes, Benz, Peugeot, Jaguar, Saab and Volvo. ttia Journal Tlnm, Wadnaedey. May 18, 1MB rtolna, Ww.

CI t' di ANT ty JUL! WiM AT A ft A LLP I Is! Maryland sets limit of $1,000 ANNAPOLIS. Md. (AP) Maryland's privately Insured savings and loan associations are operating under an executive order issued by Gov. Harry Hughes limiting withdrawals from about 1 million accounts to $1,000 a month. The governor will call the legists ture into special session Friday to take further steps to protect the thrifts.

The moves were announced Tuesday after earlier efforts were unsuccessful in halting a run on the 102 SftLs insured by the Maryland Savings-Share Insurance Corp. State officials have been struggling since last week to cope with a crisis that began with the disclosure of serious management problems at Old Court Savings and Loan. lines of depositors anxious to withdraw their funds quickly developed at branches in the Baltimore Hughes said his restriction on withdrawals will be in effect as long as needed to protect the savings and loan industry and depositors' money. The limit of $1,000 in withdrawals each month will apply to all accounts, and there will be no exceptions, even in hardship cases, Hughes said. Hughes said depositors "wouljl face a worse fate than not being able to cash a check for $1,000" be allowed the run on deposits to continue.

The state secured a court ordej early Monday putting Old Court bi the hands of a conservator. ia Concern among depositors state savings and loans increased Friday when Merritt Commercial Aaaociatad Praia was instructed by its private insurj er to sell a 39-story building undei Last of the line construction in downtown Baltimoj re. Merritt, at the request of its du rectors, was placed in the hands ol- conservators late Monday. When the special General AssenM bly session begins Friday, leeisla Herb Hall a worker at International Harvester Farmall tractor plant at Rock Island, drove the last tractor made at there off the line Tuesday. The two-million square foot plant will be permanently closed, as previously reported.

Tenneco Inc. bought most of Harvester's farm equipment division at the end of January and is merging it with its Racine-based J.I. Case Co. subsidiary. The sale did not Include the Farmall plant, but Case completed the tractors that were under assembly when pro- duction at the plant was suspended last fall for inventory control purposes, including the machine Hall drove off the line.

The tractors will be sold by Case International-dealers. Case, won't produce any of the Harvester tractors in the U.S.. and is dropping 1 0 former Harvester models, ranging from 80 to 1 87 power takeoff horsepower. The former Harvester models that Case will continue to produce, machines under 100 horsepower, will be produced at plants in Europe. tors will be asked to approve legisl lation requiring all with as4 sets of more than $25 million tig move into the federal insurance program.

That includes about onel third of the privately insured thrifts now operating in Maryland. Output fell HTTll COMPLAISfT AQA1MST AMC: American Mo-ton Corp. has settled National Labor Relations Board unfair labor practice complaint stemming from iU support of a 1963 libel suit against the publishers of a labor newsletter, the Associated Press reported from Milwaukee. Lloyd Northard, an AMC spokesman, confirmed Tuesday that company officals have initialed a tentative agreement with the Milwaukee NLRB office. He would not disclose details of the settlement, which he said would likely be approved by the NLRB in Washington within 60 days.

The Milwaukee Journal quoted an anonymous source who said the three Cibllshers of the Fighting Times would receive about $240,000 for gal fees, lost wages and other expenses Incurred because of the i libel suit brought by a group of AMC supervisors. The publishers Jonathon Melrod of 1524 Flett Ave. and Kenosha residents John Drew and Tod Ohnstad were UAW Local 72 stewards at the Kenosha plants and now sit on the local's executive board. Settlement negotiations began in February before the scheduled start of an NLRB bearing into union allegations that the company instigated and financed the libel suit. A Kenosha County Circuit Court jury last November declined to award damages in the $4.2 million suit brought against the three for statements made in the newsletter's "Scab of the Month" column.

The NLRB complaint contended tha-tAMC harassed the three by financing and directing the libel suit and violated the publishers' protected labor rights. The complaint said AMC's actions amounted to an attempt to suppress the newsletter. CAR SALES FELL The seven major domestic carmakers reported Tuesday that sales in the May 1-10 period fell 8.6 percent, to 217.832 from 238,240 in the year-earlier period, the Associated Press reported. Among the Big Three, General Motors Corp. sales were down 12.9 percent and Ford Motor Co.

sales were off 3.0 percent. Chrysler Corp. posted a gain of 3.S percent. Among the small producers. No.

4 American Honda Motor Co. Inc. sales of Ohio-made Accords were up 2.4 percent. American Motors Corp. sales were down 27.1 percent and Volkswagen of America Inc.

sales were down 2.7 percent. MIN.MUM tUSINESS TAX PROPOSED: Assembly Speaker Thomas Loftus wants Wisconsin businesses whose books show no profit to pay a minimum of $200 in corporate income taxes, the Associated Press reported from Madison. Loftus, D-Sun Prairie, said Tuesday that the tax would raise $14 million over two years and could be used to fund a cut in individual income taxes being considered this week by the Legislature's Joint Finance Committee. The committee is considering restoring deductions for mortgage Interest and charitable contributions. Both were eliminated in Gov.

Anthony S. Earl's proposed Mtt-87 budget. Loftus said an analysis completed in 19(3 showed that 60 percent of the nation's corporations had no tax liability. "Our experience is about the same as the fed's," he said. "A very Urge number of firms are not paying taxes.

FARM LOAM OFFICES TO CLOSE: Seven temporary loan centers established to dole out emergency spring planting loans to cash-strapped farmers will close by mid-June, according to Ronald Caldwell, state director of the Farmers Home Administration, the Associated Press reported. Offices in Wisconsin Rapids and Oakdale will close May 31; in Rice Lake, June in Madison, Fond du Lac. Eau Claire and Stevens Point, June 14, Caldwell said Monday. Caldwell said the amount of loans in the state, which stood at $103 million Friday, proved that the farmers' credit crunch was real. He said early estimates had predicted the agency would need to loan only between $50 million and $70 million.

A total of 2,753 Wisconsin fanners received loans from the FmHA, the federal government's lender of last resort. About 15 percent of those who applied were rejected, Caldwell said. FOLEY, LARDNER GOES INTERNATIONAL: Wisconsin's largest law firm, Foley Lardner of Milwaukee, said it plans to expand overseas in Germany and Mexico, the Associated Press reported. Edwin P. Wiley, head of the firm's international business group, said a formal affiliation has been established with the firm of BoetUcher, Be met ft Partners in Munich, West Germany.

He said Foley would send a senior executive to Mexico City to work with the firm of Barrer, Siqueiros Torres Lands. Wiley said about 20 of the firm's 240 attorneys spend a significant amount of their time working on international transactions. In addition to the home office in Milwaukee. Foley ft Lardner also has offices in Madison; Washington, and Orlando, Tampa and Jacksonville, Fla. STRAZ COMPLETES BUY: David A.

Strai Jr. said Franksville-based First Bank Southeast has completed purchase of Farmers ft Merchants Bank and is operating the two former FftM offices, at 3525 Rapids Drive and 1001 Milwaukee as branches. Strax, who owns First Bank Southeast through First Southeast Banking a holding company, said the transaction was closed Saturday. Price was about $1 88 million cash, he said, ontrolling interest in FftM had been held by about six Chicago investors, who bought control from Straz in 1974. Strax has in effect repurchased the bank, which had assets of about million.

The purchase gives First Bank Southeast its 9th and 10th offices. The others are at Sturtevant, Burlington, Kenosha (four) and North Cape. MOOINE ROOSTS PAYOUT: Modine Manufacturing 1500 DeKoven today raised the quarterly dividend on common stock from 14 cents a share to 17 cents, payable June 7 to shareholders of record May 2t. ZAYRE PROFIT CUM3S: Zayre Framingham, Mass operator of discount department stores and specialty stores, said its profit for toe fiscal first quarter ended April 27 rose 40 percent on a 21 percent sales gain. Zayre posted a profit of fl4.K.000 or 70 cents a share, up from $10,061,000 or 53 cents a share in the year-earlier quarter.

Sales rose to $756,230,000 from $622,662,000. LOCAL 72 FILES CHARGE: Rudy Kuzel, president of UAW Local 72 at American Motors Kenoshs plants, said today the union has filed an unfair labor practice charge against the company with the National Labor Relations Board's Milwaukee regional office. He said an earlier charge was amended this week to include complaints the company is not bargaining to good faith Kuzel said the charge was prompted by "the constant barra-m of letters to toe membership" from AMC and AMCs position that it will not eef fe face-to-face negotiations unless the union agrees in advance to extensive conceswons that would give it a contract similar to that at General Motors Corp. As previously report AMC mailed a letter, fct lUy 13. to tf local's mw-Urs ref.i-g its Uvwt to mmt to tKoe its operations if the LAW doeVt a eiwsswcs by May 34.

Ki Mid the f-n to t' to tow Thursday en the ik executive board I rcvrrjrwnUtim to open aefotia-tym aarUf tt-a csssi. ktJ tc-is wJl be aaeowced monwrg. Ads'lUfo milk sales a bit WASHINGTON (AP) U.S. ihl dus trial production fell 0.2 percenW in April, the first decline in six months, as the industrial sector ol the economy continued to suffe from America weak trading pe formance, the government repoi today. The Federal Reserve Board sail its index of total output at the David Thome Journal Timas RACINE COUNTY An advertising campaign hasn't ended the woes of dairy farmers, but dairy farmers here say things would be worse without the Joseph Westwater, the National Dairy Board's chief executive officer, said the $67 million national advertising campaign touting the virtues of dairy products appears to be paying off in increased milk sales.

Westwater was in Milwaukee Tuesday to speak at a convention of agriculture marketing officials. Milk sales in the first three months of the year were up 1.7 percent from the same period in 1964, he told a Journal Times reporter in an interview. "That's significant, when you consider sales were even, and down, over the last five years," he said. Richard Robers, manager of the Associated Milk Producers Inc. plant in Burlington said the dairy industry would be in worse shape if not for the ads.

Things will get worse between now and July, he added, when price supports are cut by 50 cents. Companies that produce cheese, butter and powdered milk are not buying milk at current prices because the price is expected to drop in July, he said. "Promotion has paid off, but the surplus problem is not over," he said. The dairy promotion program, funded by a 15 cent-per-hundred weight fee on milk farmers sell, was started last April as a measure to reduce the nationwide surplus of dairy products. Robert Thompson of Lions, regional president of AM PI, said even though farmers are selling more milk, income has not increased because prices have been cut.

State and national promotion programs have worked well, he said, adding that the national program is a better bargain, because the market needs to be cultivated more in other states than in Wisconsin. Westwater said it's too early to tell if the promotion- al campaign will have a lasting effect. tion's factories, mines and utilities' fell for the first time since a 0.4 percent decline last October. The report showed that output at manufacturing companies was down 0.2 percent with the biggest drop oc-. curring in industries making durable goods, items expected to last three or more years.

These indus tries suffered a 0.4 percent declu while the nondurable goods segmeni dipped 0.1 percent. Wadnaiaav't atftmata racHpH: SM Grain futures JW caiiraa, tw rtoet ana a lamaa. Locml krtmrmst Cwrtnr aoan m. 4 C. Inc.

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