Detroit Free Press from Detroit, Michigan • Page 34

business auto mon DETROIT FREE PRESSFRIDAY, JANUARY 4, 1980 6C Golc soars toMier icEiei ax -mm. i ,1 iti 1 I i -I 1 1 JlfT! iHrrri I cert- European hanks bolster the buck By JAMES PEIPERT Associated Press Writer Gold prices around the world soared Thursday as traders, worried by crises in Iran and Afghanistan, shifted wealth from currencies to bullion, sending the price spiraling to $649.73 an ounce in Hong Kong before it fell back to $621 in New York. The dollar was battered in foreign-exchange trading in Asia and Europe before European central banks intervened to support the American currency. By the time trading ended in New York, the dollar was slightly higher against most other currencies. "THE GOLD MARKET is now the Valium of the world," said bullion dealer David Edwards from the trading floor of New York's Commodity Exchange.

Gold traditionally is seen as safer than currencies during crises. Bullion closed at historic fil- Amm'-'' Bm, Market dips 4.26 in heavy Free Press Pholo by HUGH GRANNUM Auto companies say layoffs to reach 190,000 next Meek I Auto company layoffs will reach 190,925 next week, according to company announcements Thursday. Of the total, 145,950 will be for an indefinite term, almost all of them announced earlier. The rest 44,975 will be ic "veek or two, almost all of them in new, temporary plant closings ic t'uee inventories of unsold cars and trucks. -r' Here are next week's temporary plant ckw; not announced previously and the number of workers affced at each: Ford Car assembly plants closed for two weeks: Atlanta, Chicago, Lousiville, Los Angeles, Mahwah, N.J., Metuchen, N.J., St.

Louis, Wayne, 3,650. Closed for one week: Wixom, Mich, San Jose, Lorain, Ohio, 3,875. Truck plants: Kansas City, Lorain and Avon Lake, Ohio, 4,000. The Ford closings will idle 34,575 temporarily. General Motors Corp.

Car assembly plant: Janesville, 3,500. Car-truck plant: Fremont, 2,900. Total 6.400. Chrysler Announced the indefinite layoff of 350 at it Toledo machining plant, bringing the total of indefinite layoffs to 36,550 next week. GM said it had 71,200 on indefinite furlough, Ford said it had 36,550 and American Motors Corp.

said it had 1,200. Ford's total includes an unknown number in its steel and glass operations, which have substantial sales outside the company and the industry. Headlines A FEDERAL JUDGE in New York has revoked bail on alleged securities swindler Alan H. Abrahams, former president of Lloyd, Carr who was due to be released from prison Friday. Abrahams has been indicted on 50 counts charging him with defrauding customers of the I commodity options firm, which had offices in Detroit and other major cities, of $24 million.

He has been serving two years on an old federal parole violation. U.S. District Judge William C. Connor revoked the $35,000 bail he had set last week and ordered the trial to begin Feb. 1 1 Abrahams was an escaped fugitive from a New Jersey jail at the time he ran the Boston-based Lloyd, Carr firm under an assumed name.

PICKET LINES were formed at the Volkswagen of America plant in South Charleston, W.Va., after union and plant officials failed to reach an agreement on a new three-year contract. Members of UAW Local 1933 walked off their jobs, and pickets were assigned to four-hour shifts outside the stamping plant. Among the issues at the bargaining ta-t ble is an hourly pay boost, which would bring the 409 workers in line with wages paid by the Big Three automakers. THE CONFERENCE BOARD said its help-wanted index 1 slipped to its lowest level since last August. The business-! supported research organization's index gauges the volume of classified help-wanted advertising in 51 newspapers nationwide.

It fell to 158 in November from 167 in October and 161 in November 1978. The index stood at 100 in 1967. Want-ad volume declined in all nine geo Gold trader Al Golden tries to keep up with the workload in Southfield Thursday. Gold traders? Steel nerves! iraciinj Arabs are buying up most of the gold. But his favorite personal example of a successful gold trader is his secretary, highs of $635 in Zurich and $630 in London Thursday.

In New York, bullion reached $635 a troy ounce before settling back to $621 at the closing, according to Republic National Bank. On New York's Commodity Exchange, a gold-futures contract for January delivery climbed $49.50 to close at $625 an ounce. "It's frantic up, up, up," a harassed London bullion trader said of the metal's leap from $567.50 at Wednesday's London close. Zurich, Europe's biggest gold market, reopened Thursday after a five-day New Year holiday and bullion closed $118 higher than when it last traded Dec. 28 at $517 an ounce.

"They must be speculating on some appalling international crisis," said Dr. Alan Budd, director for economic forecasting at the London Graduate School of Business. "The present price of gold can only be justified if people have the most incredible fears about world inflation." 24-year-old Diane Lud-winski. Seven months i ago she and her hus band, Kurt, 26, put down 20 percent (about $1,700) to purchase 20 South African Kruger-rands, a one-ounce gold coin, for about $440 Golden's boss, First National Vice-President James Wechsler, said Wednesday and Thursday were the busiest days he's seen in his five years of gold trading. "We can't even get enough telephone lines here.

People can't even get in to us," he said. As gold rose $20 an ounce Thursday in the course of an hour's conversation in First National's Town Center office in Southfield, Wechsler recalled when gold was selling for only about $100 an ounce in 1976. "You couldn't give it away then," he said, exaggerating slightly. But last year, the price of gold increased nearly $300 an ounce. And it has already gone up more than $100 in just two trading days this year.

WHO'S MAKING all the money? Wechsler said the rumors are that By LOUIS M. HELDMAN Free Press Business Editor In the Southfield trading room of America's largest gold dealer Thursday, traders and order clerks were yelling into telephones often two at a time and at each other as computer screens scattered about the room were chronicling gold's surge on exchanges around the world. The chief trader, a lanky 23-year-old, whose name, ironically, is Al Golden, was executing orders phoned in by First National Monetary 140 account executives in Dallas, Miami, Irvine, and Southfield. He and two other traders were dealing by telephone and Telex with representatives at Chicago and New York exchanges and with wholesale precious-metals dealers throughout the United States. 4 each.

Ludwinski On Thursday, she sold them for a $5,500 profit. "Boy, was it nerve-wracking," she said. Mrs. Ludwinski said she decided to sell when the price passed $600 because "everybody told me not to get greedy." She said she'll buy again if the price goes down. NEW YORK (AP) -Stock prices declined Thursday in the heaviest trading since mid-October as the market attempted to come to grips with international turmoil and growing tension between the United States and Soviet Union.

The Dow Jones average of 30 industrial stocks finished the session with a 4.26 loss at 820.31. The blue-chip index initially plummeted about 1 1 points in early trading, recovered much of that loss by early afternoon, then was hit by a selling wave again. "The market has finally caught up with the bad news," said Alan Poole, an analyst at Laidlaw, Adams Peck. After a lull during the holidays, the Dow Jones index fell more than 14 points Wednesday, the first trading day of the New Year, and encountered hectic activity Thursday. BIG BOARD volume came to 50.48 million shares, up from 40.61 million in the previous session, and the highest since Oct.

10, when a record 81 million shares changed hands. Gold and silver mining stocks, which have been posting big gains for the past several sessions as bullion prices spiraled, closed mixed Thursday with heavy profit-taking in some issues. the auto tally Auto sales record 9th straight drop; Chrysler off 36 Sales of domestic-built cars only during Dec. 1 1 -20 of 1 979 and 1 978 and for Jan. 1 through Dec.

20 of each year, as reported by the five manufacturers Thursday, were as follows: graphic areas surveyed by the organization. Year Year Dec. 11-20 Dec. 11-20 THURSDAY'S gold rush was fueled mainly by repercussions of the Soviet Union's Christmas Day invasion of Afghanistan including recall of the U.S. ambassador from Moscow.

But dealers also pointed to the U.S.-Iranian crisis, higher oil prices that will exacerbate worldwide inflation and chronic decline of the dollar. With gold at new highs, one dealer spoke of "general mistrust of currencies, which hits the dollar hardest because it's the main reserve currency." By the time the trading day ended in New York, the dollar was higher against currencies of West Germany, France, Switzerland, Japan and Britain. It was fractionally lower against the Canadian dollar. 1979 1978 1979 1978 American Motors N.A. 2,429 168,145 Chrysler Corp.

17,046 26,470 923,717 1,118,455 ChryslerPlymouth 10,385 16,368 560,668 686,194 Dodge 6,661 10,102 363,049 432,261 Ford Motor Co. 47,088 57,632 2,092,734 2,525,941 Ford 32,990 37,913 1,466,474 1,776,528 LincolnMercury 14,098 19,719 626,260 749,413 General Motors 123,151 128,087 4,806,205 5,268,101 Chevrolet 54,960 50,819 2,105,428 2,309,165 Pontiac 21,925 22,608 768,700 872,593 Oldsmobile 24,743 24,703 934,458 983,896 Buick 13,443 18,276 692,997 760,919 Cadillac 8,080 11,681 304,622 341,528 Volkswagen U.S. 4237 2308 160,800 19,559 Industry Totals 196,022 217,426 8,140,732 9,100,201 METRO-GOLD WYN-MAYER whose profits were buoyed last year by the sale of television rights to the film "Gone with the Wind," reported a decline in earnings for its fiscal first quarter. The motion picture, television and hotel-casino company said earnings in the quarter ended Nov. 30 came to 1 5.3 millon, or 47 cents a share, against $26 million, or 80 cents a share, a year ago.

Revenues slipped to $129.3 million from $143.4 million. THE STATE DEPARTMENT criticized Mexico's decision to raise the price of its crude oil from $24.60 to $32 per barrel. Calling the increase "unjustified," department spokesman Hodding Carter said the United States is deeply concerned about the impact of such increases on the health of the international economy. U.S. oil imports total about eight million barrels a day, of which Mexico provides about 440,000 barrels.

FARMERS AND MERCHANTS National Bank of Benton Harbor has become the 10th Michigan bank to affiliate with National Detroit the holding company parent of National Bank of Detroit, officials said. More than 80 percent of Farmers and Merchants' outstanding shares have been purchased by the holding company for the state's largest bank, according to top executives of both banks. THE BUDD CO. of Troy announced the acquisition of Place Machine Sales a producer of transfer machines designed for "high volume production of automotive parts." No price was disclosed for the sale. Place, also headquartered in Troy, operates plants in Troy and Warren.

Its products include transfer machines and dial index machines By TOM KLEENE Free Press Automotive Writer New domestic car sales in mid-December continued their decline for the ninth straight 1 0-day period, dipping 9.8 percent from their mediocre performance in the same period a year ago, with troubled Chrysler Corp. again reporting the biggest loss. The No. 3 automaker tumbled 35.6 percent from the 1978 period. Some analysts are now forecasting that Chrysler's sales are unlikely to take any turn for the better until after President Carter signs the bill providing the company with 1 .2 billion in federal loan guarantees.

The legislation was not passed by Congress until after the Dec. 11-20 sales period. General Motors Corp. and Ford Motor Co. reported lesser declines of 3.9 percent and 18.3 percent, respectively.

GM captured a 62.8 percent share of the mid-December market, compared with its normal 59 percent of the total pie, as Ford's penetration dwindled to 24 percent and Chrysler's to only 8.7 percent. The mid-month sales reports were delayed by extended holiday vacations at the auto companies; final figures for the month and year will be reported Friday. AS REPORTED BY the manufacturers Thursday, sales for the period totaled 196,022, compared with 217,426 a year ago. The figures include an estimate of 4,500 sales for American Motors which reports its sales only on a monthly basis. On the basis of AMC's estimated sales for the period, the company's sales increased about 85 percent over rock-bottom levels a year ago when it was in a prolonged slump.

AMC, in the N.A. Not available. American Motors Corp. has discontinued Hit; Ad firm elects new president Ross Roy Inc. Thursday confirmed some long-rumored changes in top management of the Detroit-based advertising agency.

Glen W. Fortinberry, formerly with J. Walter Thompson Co. here, was elected the agency's president and chief operating officer. Current President John S.

Pingel was promoted to a distribution of its 10-day sales reports. Its sales figures are available only monthly. process of gradually improving its share of the market, managed a 2.3 percent penetration, compared with 1.1 percent a year ago. Volkswagen of America took a 2.2 percent share on sales of 4,237 units, almost double its volume a year earlier when lack of availability restrained sales. As of Dec.

21 the industry's total sales for 1979 trailed the comparable 1978 period by 10.8 percent. ec. retail sales healthy Fortinberry new post, vice-chairman and chief executive officer. Ross Roy, the agency's founder, will remain chairman, but relinquishes the CEO role to Pingel. And Richard C.

Ward was named to another new post, executive vice-president. The changes were foreshadowed last month when Donald C. Graves, considered Pingel's heir apparent by many, resigned as the agency's senior vice-president and assistant to the president. He remains with Ross Roy as a consultant, but not under contract. FORTINBERRY'S decision to join Ross Roy raises eyebrows among local ad people because of his experience handling Thompson's Ford Motor Co.

account. Ross Roy long has been associated with Chrysler now handling its merchandising and sales-promotion accounts. Those are worth an estimated $54 million in billings more than a quarter of the agency's $175 million in billings. Other major clients include mart Detroit Edison Co. and Detroitbank Corp.

To come to Ross Roy, Fortinberry, 52, resigned, effective last Monday, as vice-chairman of Thompson at its New York headquarters. He was with Thompson's Detroit office twice, from 1964-68 and 1971-75, ending the latter period as executive vice-president and managing director. Before being named vice-chairman, he was executive vice-president in charee of that perform milling, boring, drilling and inspection tions. Budd manufactures automotive components and other transportation products. THE GREAT ATLANTIC Pacific Tea owner of supermarkets, reported its profits fell 23 percent in the company's fiscal third quarter.

t' I Housing construction plunges The value of U.S. new-home construction plunged by 21 percent between October and November as sharp credit-tightening by the Federal Reserve squeezed off the flow of mortgage money, a monthly survey said Thursday. The F.W. Dodge Division of McGraw-Hill Information Systems Co. said the value of residential building contracts dropped to $4.71 billion in November from $5.97 billion in October, with the decline "concentrated in one-family homes." The Dodge report came a day after the Commerce Department said U.S.

construction spending fell 1.3 percent between October and November to a seasonally-adjusted $235.3 billion annual rate. Outlays for residential buildings fell 0.9 percent to a $98.3 billion annual clip, the Commerce Department said. The drop in housing construction pulled the Dodge index of total construction value down to 156 from October's 171 and September's 185. The index stood at 100 in 1972. Chrysler cuts prices on imports Chrysler Corp.

reduced prices of its imported models a month ago without announcing the move, the company confirmed Thursday. The cuts averaged 2.1 percent, or $122 a vehicle, and put sticker prices of the Mitsubishi Motors Corp. products back about to where they were at the end of the 1979-model year. A Chrysler spokesman, who did not want to be identified, said the lower prices were the result of the increasing value of the U.S. dollar against the Japanese yen.

He said he did not know why the lower prices were unannounced. The cheapest Mitsubishi cars, the Dodge Colt and Plymouth hamp hatchbacks, were listed for $4,331 on Dec. 3, $119, or 2.7 percent, less than before. The Plymouth Arrow and Dodge D50 pickup trucks were dropped 1.2 percent, or $57, to $4,821. Chrysler owns 1 5 percent of Mitsubishi Motors, whose cars accounted for one out of every eight sold by Chrysler in the first 11 months of the year.

CompileJ BOB WITT Pingel parent, Dayton Hudson Corp. of Minneapolis, to "very strong" at Lord Taylor's three area stores, according to a spokesman for that chain in New York. Dayton Hudson and mart Corp. of Troy, as they'd done for most of 1979, turned in Christmas performances among the strongest. Sales for mart, the nation's No.

2 retailer, were up 1 1.8 percent, from $2 billion to $2.2 billion. At Dayton Hudson, sales were up 15.2 percent, from $565.5 million to $651.5 million. "Our West, Southwest and Eastern regions performed better than did the Central industrial U.S.," said Herbert S. Christner, mart's assistant treasurer. "That has been the pattern for the last two or three months.

I think in our stores in that region Michigan, Indiana, Ohio, Illinois, Wisconsin, Missouri people probably backed off from purchasing this year it was auto-related." At Dayton Hudson, "we thought we'd do all right, in double digits, but we did better than (the forecast)," said spokesman Tom Langenfeld. "The week including Christmas was up dramatically and the week before Christmas was also strong." Sales for Dayton Hudson's department store which includes Hudson's and Dayton's in Minneapolis, were up four percent. Sales for the low-margin division were up 23 percent and sales at Mervyn's, the California division, were 36 percent higher. AT HUDSON'S, executives are "not thrilled, but pleased" with Christmas results, said President Theodore Bintz. "We planned very conservatively, but exceeded our final (sales) projection." As announced earlier, Hudson's set a one-day sales record of more than $7 million on Dec.

21. Best sellers were clothing, especially sweaters and velour items, and goods from the higher-priced Woodward Shops, Bintz said. Lord Taylor, a division of Associated Dry Goods Corp. of New York, had "double-digit increases" for all its 32 stores, said its spokesman. "In a tough time, people tend to spend money on investment goods, which is our stock in trade tweed skirts, cashmere sweaters, down jackets," the spokesman said.

Among other national retailers, major gainers included Carter Hawley Hale Stores Inc. of Los Angeles (Neiman-Marcus, John Wanamaker), up 12.1 percent from $414.6 million to $464.7 million; and F.W. Woolworth the nation's No. 4 retailer, up 8.1 percent from $1.1 billion to a record $1.2 billion. Sears, Roebuck the country's largest retailer, showed an increase of 3.9 percent, its largest of the year, from $2.6 billion to $2.7 billion.

J.C. Penney No. 3, had an increase of 3.4 percent from $1.9 billion to $2 billion. Montgonv ery Ward the No. 5 retailer, had an increase of 4.6 percent from $768 million to $803.6 million.

By STUART ELLIOTT Free Press Marketing Writer After fears the Grinch would steal Christmas, the nation's major retailers found they had quite a bit to celebrate. Sales for most major chains were up by healthy percentages for the five weeks ending Dec. 29, compared with Christmas 1978. The news, reported Thursday, was especially cheery for a couple of reasons: Christmas '78 was itself an excellent sales season, making 1979's results an important accomplishment, and Christmas '79 was widely forecast as a potential bummer. Though sales began slowly, due to unseasonably warm weather across most of the country, they finished with a bang in the last days before Christmas.

Post-Christmas volume was good too. The Christmas-shopping season is vital to retailers because they usually make one-third or more of their annual sales from October to December. And many make an even higher percentage of their profits during the period; those months accounted for 49.5 percent of profits of the country's 1 0 largest chains during Christmas '78. IN THE DETROIT area, as for most of last year, sales volume was good but increases weren't as large as those achieved by stores in the South, Southwest and East. Results ranged from "slightly ahead" of last year at J.L.

Hudson according to a spokesman for its Ward the U.S. eastern region, which includes Detroit. The changes at Ross Roy are an effort to "beef up our senior management group," a spokesman said. In hiring Fortinberry, the agency has "added a heavyweight as president, with a lot of creative experience," the spokesman said. Pingel, 63, joined Ross Roy in 1960.

He has been president since 1964 and is immediate past chairman of the American Association of Advertising Agencies. Ward, 46, joined Ross Roy in 1978, after working at Monroe Auto Equipment Co. and Kenyon Eckhardt Inc. Roy, 81, founded the agency in 1926. Stuart Elliott.