Newsletter: California Inc.: Coachella is ready to rock — and generate oodles of cash
Welcome to California Inc., the weekly newsletter of the Los Angeles Times Business Section.
I’m Business columnist David Lazarus, and here’s a rundown of upcoming stories this week and the highlights of last week.
Wall Street returns to business Monday after last week’s U.S. missile strike on Syria and the latest economic kick in the teeth. We learned Friday that job growth slowed sharply last month, tumbling to its lowest level in nearly a year. The U.S. economy added just 98,000 net new jobs, a little more than half of what analysts had expected. The figure was well off the 219,000 positions created in February.
LOOKING AHEAD
Up in the air: What is the nation’s best airline? One respected measure is the annual Airline Quality Rating report, which comes out Monday. The ratings assess on-time performance, denied boardings, mishandled bags and customer complaints. The rankings are produced by Embry-Riddle Aeronautical University and Wichita State University and are based on U.S. Department of Transportation data. For the last four years, the top airline has been California-based Virgin America.
Life in the sprawl: The Urban Land Institute is sponsoring a forum in Los Angeles on Wednesday to address the question “How can L.A. grow ‘up’ without pushing people out?” Urban Marketplace 2017 will feature political and industry leaders discussing such topics as housing, Metro Rail, downtown development, driverless cars and balancing growth with the environment. The opening speaker will be L.A. County Supervisor Hilda Solis.The event runs from 7:30 a.m. to noon at the Reef exhibit space, 1933 S. Broadway.
Fast pitches: Start-up companies aiming to serve the needs of people over 50 will have a chance to woo investors at AARP’s sixth annual Innovation50+ conference on Wednesday and Thursday in Mountain View. The second half of each day will feature pitch competitions with 10 healthcare technology and 10 financial companies. Each company has just 3 minutes to pitch itself to a panel of industry judges, including venture capitalists and investors focused on healthcare and finance.
Music and money: The Coachella Valley Music and Arts Festival opens Friday, bringing a flood of music lovers and their cash to Indio and other cities in the desert valley. Coachella and its sister country music event, Stagecoach, are estimated to bring in over $700 million to the area. Daily attendance during the six days of the pop festival, held on successive weekends, reaches nearly 100,000 people. This year, the festival is headlined by Lady Gaga, Radiohead and Kendrick Lamar.
Auto show: On Friday, the 117th New York International Auto Show opens. More than 1,000 vehicles will be displayed at the Jacob Javits Convention Center in Manhattan at the event that runs through April 23. BMW will show off its latest line of hybrid plug-ins, Mercedes-Benz will unveil three new models, and Honda will reveal a version of its Civic that it calls “the fastest, most powerful Honda ever sold in America.”
THE AGENDA
Monday’s Business section looks at Wal-Mart’s aggressive (albeit belated) efforts to expand its e-commerce horizons. With nearly a half-trillion dollars in annual sales and 4,700 U.S. stores, Wal-Mart has been buying online retailers, slashing shipping rates and rolling out new ways for in-store customers to do more of their shopping at Walmart.com and its other websites. While traditional U.S. in-store retailing is growing less than 2% a year, forcing many retailers to close stores, e-commerce is growing 16% annually. Wal-Mart doesn’t want Amazon dining solo at that table.
STORY LINES
Here are some of the other stories that ran in the Times Business section in recent days that we’re continuing to follow:
Rent control: A state bill that would let cities expand rent control has been put on hold for a year by its author amid fierce opposition from landlords. The proposal from Assemblyman Richard Bloom (D-Santa Monica) would repeal the landmark Costa-Hawkins Act, a 1995 law that barred rent caps on single-family homes and apartments built after that year. Bloom said legislative timelines won’t allow time for “thoughtful consideration and comment” from all groups affected by a “significant change to California law.”
Twitter tiff: The Trump administration has rescinded a demand that Twitter share information about a user who has criticized the president. Twitter received an administrative order to turn over records nearly a month ago, but said it refused to do so without evidence the information was crucial to a criminal investigation. After the government reportedly failed to provide such justification and refused to drop the demand, the San Francisco company launched a preemptive strike by suing the Trump administration.
Consumer agency: The chairman of a powerful House Financial Services Committee welcomed the nation’s top consumer financial watchdog to a hearing last week by expressing surprise he showed up — and hoping he never does so again.The nearly five hours of questioning endured by Richard Cordray, director of the Consumer Financial Protection Bureau, marked a new level of hostility in the sharply partisan battle over the agency’s future.
Trouble at Fox: Big-name advertisers including BMW, Lexus and Allstate pulled their spots in response to revelations that $13 million was paid to women who accused Fox News’ Bill O’Reilly of sexual harassment or inappropriate behavior. Advocacy groups called on Fox News to fire the combative commentator. The advertiser defection compounds woes faced by parent 21st Century Fox and the news network, which has been hit by multiple claims from women alleging mistreatment.
Whistle-blower: It was a tough week for Wells Fargo & Co., which is still reeling from its unauthorized accounts scandal. First, the Occupational Safety and Health Administration ordered the San Francisco bank to rehire a former Los Angeles-area bank manager who the agency said was fired because he reported potential fraud to his superiors and to a bank ethics hotline. Later, an influential shareholder advisory firm recommended that investors vote against most of the company’s incumbent board members at its upcoming annual meeting due to the board’s failure to provide adequate oversight.
WHAT WE’RE READING
And some recent stories from other publications that caught our eye:
Pass the Prozac: Jamie Dimon, CEO of JPMorgan Chase,warned last week in a 45-page letter to shareholders that “something is wrong” with the U.S. economy, Fortune reported. Dimon, an advisor to President Trump, cited high healthcare costs, student debt, trillions of dollars spent on wars since 2000 and other issues. “Making this list was an upsetting exercise, especially since many of our problems have been self-inflicted,” Dimon wrote.
College debt: The nation’s largest student loan servicer, Navient, has said it wants to help borrowers. But when faced with a potentially multimillion-dollar lawsuit, the firm tells a different story, Bloomberg notes. “There is no expectation that the servicer will act in the interest of the consumer,” Navient said in response to the suit by the U.S. Consumer Financial Protection Bureau. In court, Navient says its main job is make sure lenders, like the U.S. Department of Education, get their money back.
Insurance rates: It’s long been known that auto insurers charge higher rates to drivers living in predominantly minority neighborhoods, a practice they defend by citing a higher accident risk. But a new analysis by Consumer Reports and Propublica finds flaws in that argument. “In some cases, insurers such as Allstate, Geico and Liberty Mutual were charging premiums that were on average 30% higher in ZIP Codes where most residents are minorities than in whiter neighborhoods with similar accident costs.”
How-to guides: The two guys running the do-it-yourself website iFixit have made a big enemy, reports Inc. “Apple doesn’t like iFixit, because iFixit writes its own in-house versions of Apple’s top-secret repair manuals and shares them with all comers.” The modest Web operation, based in Atascadero, Calif., is shaking up a lot of business models by helping people repair their own electronics, cars and appliances.
Towering achievement: The 123-story Lotte World Tower in Seoul, which opened last week, offers some dazzling views, as Bloomberg shows in a photo essay. The towers boasts the world’s highest glass-bottomed observation deck — look down at your feet and you’ll have a view 1,640 feet to the ground. The tower is “also home to the world’s highest swimming pool in a building, on the 85th floor, and the world’s fastest elevator, which can whisk visitors to the top in one minute.”
SPARE CHANGE
That photo essay made my pop-culture radar immediately home in on “The Towering Inferno,” which could barely contain the blue-eyed awesomeness of its two mega-stars. Steve McQueen only agreed to do the movie if his name appeared before Paul Newman’s in the credits. The filmmakers accomplished this, and avoided slighting its other star, by putting McQueen’s name to the left of Newman’s, while positioning Newman’s a little higher. McQueen also demanded that he and Newman have the same number of lines, were paid the same and received the same share of box office profits. A towering ego.
Oh, and don’t forget the star turn by O.J. Simpson as a security guard.
Fun fact: McQueen reportedly turned down the Redford part in “Butch Cassidy and the Sundance Kid” when he found out Newman would get top billing.
For the latest money news, go to www.latimes.com/business. Mad props to Scott J. Wilson for helping put this thing together.
Until next time, I’ll see you in the Business section.
