Explaining Southern California's economy

In SoCal business news: Herbalife investigation, Uber adds 'safe rides' fee


A worker cleans the logo on the Herbalife sign as finishing touches are put on the company's building in Torrance, Calif.

Happy Friday! Welcome to KPCC's business blog, The Breakdown. Every weekday, our staff compiles a list of interesting business stories in the region.

  • Herbalife is targeted in another investigation of its practices, this time from the Illinois attorney general's office (Los Angeles Times). The L.A.-based firm is also being investigated by the Federal Trade Commission (KPCC).
  • Aereo's CEO Chet Kanojia hopes for a "clear decision" from Supreme Court on whether his company violates copyright laws and says Aereo has less than one million users (The Wrap). Broadcast networks have complained against Aereo's business. When customers sign up to access network TV programming using online service Aereo, they're not paying the fees that cable and broadcast networks rely on for revenue—known as retransmission content (AirTalk).
  • L.A.'s Office of Motion Picture and Television Production made some recommendations to a City Council committee (Daily News). Reporter Dakota Smith says one suggestion was creating a "code of conduct" that would handle ethical issues. 
  • China Film Co. makes its second deal with a Hollywood studio, by producing "Marco Polo" with Paramount Pictures (Deadline). But not everyone is a fan of China's practices. Director Oliver Stone says he wanted to do a film on Mao Zedong and didn't get support from China on that idea (The Economist).
  • Hollywood talent agencies have added to their concert and music booking divisions, as bookers take home even more pay (New York Times). Times reporter Hannah Karp says booking agents make 10 to 15 percent of concert tour sales.
  • When did Silicon Beach begin? Broker Randy Starr believes it started around 1998 or 1999 after the "first dot-com wave." (Santa Monica Daily Press).
  • Moving the Sriracha factory out of California is a complicated endeavor (KPCC).
  • Taking Uber this weekend? You'll see a $1 safe rides fee added to your bill (Pando Daily). This comes as Uber and other ride-sharing companies are getting questioned about the insurance they provide drivers (KPCC).


How much would moving cost the maker of Sriracha?

Bottles of Sriracha chili sauce on the shelves of a supermarket in Rosemead, Calif.

Frederic J. Brown /AFP/Getty Images

Bottles of Sriracha chili sauce on the shelves of a supermarket in Rosemead.

With all the trouble in the air in Irwindale, the company that makes Sriracha hot sauce now says it’s considering a move somewhere else. Huy Fong Foods is being peppered with offers of new homes close by and far away, but moving to any of them would be costly.

"Denton loves Sriracha. We’ll never shut them down," says city councilman Kevin Roden of Denton, Texas, expressing his city's hots for the hot sauce.           

The Huy Fong Foods  factory in Irwindale is 650,000 square feet and makes at least 200,000 bottles of hot sauce a day. The facility currently employs 200 people. Moving out of it is a little different from vacating a college dormitory.

RELATED: Irwindale declares Sriracha maker a public nuisance

"Unlike moving furniture or relocating an office, this is a little bit more complex," said Nick Vyas, who directs the Center for Global Supply Chain Management at USC's Marshall School of Business. 


Why an early Chinese New Year means more cargo for the Port of LA

Maya Sugarman/KPCC

Port of Los Angeles.

The earlier timing of Chinese New Year in 2014 helped usher in more cargo at the Port of Los Angeles in March, port officials said.

Container imports and exports at the Port of Los Angeles increased 34 percent to a total of 515,323 20-foot equivalent units in March, compared to a year ago, the port said. It's part of a trend that happens every year.

"We expect next year to be no different," said Gary Moore, interim executive director at the Port of Los Angeles. "When [Lunar New Year] happens, we'll expect to see a slow down in cargo and the next month, it will pick up again." 

Chinese factories close during New Year

Lunar New Year is considered a national holiday in China, where workers are given about two weeks of time off, said Baizhu Chen, professor of clinical finance and business economics at USC Marshall School of Business. It's sort of like Thanksgiving and Christmas combined into one, he said.


In SoCal business news: Sriracha moving to Texas? Mattel posts loss

David Tran

Sharon McNary/KPCC

Huy Fong Foods founder and president David Tran with mixing machines at Irwindale Sriracha chili sauce plant.

Good morning! Welcome to KPCC's business blog, The Breakdown. Every weekday, our staff compiles a list of interesting stories in the region.

  • The maker of popular hot sauce Sriracha considers moving its Irwindale factory to Texas (Press-Telegram). Irwindale's City Council had deemed Sriracha a "public nuisance," giving the company 90 days to address complaints about factory fumes (Associated Press)
  • Irvine-based Opus Bank launched an IPO at $30 a share on Wednesday (Orange County Register). 
  • Gas prices have risen above $4 in L.A. County (Los Angeles Daily News). Bob van der Valk from the Bakken Oil Business Journal tells the Daily News that he believes prices won't fall below the $4 a gallon threshold until September.
  • Boeing C-17 employees will vote on a contract that would give 300 workers "a chance to retire with their full medical benefits and pension," while potentially cutting the pensions of 80 other workers (Press-Telegram). Boeing plans to close the C-17 plant in Long Beach by mid-2015 (KPCC).
  • Mattel posts an $11.2 million net loss in the first quarter, with Barbie sales down 14 percent (Wall Street Journal).
  • L.A. film czar Ken Ziffren says he plans to get a bill to expand the state's film and TV tax credit program on the governor's desk by August (Variety). From the story: Ziffren has "also talked to Gov. Jerry Brown, a friend, and while Brown hasn’t thrown his support behind the legislation, Ziffren indicates he is further along than he was last fall, when Garcetti said the governor still needed to be convinced."
  • Many Southern Californians pay more than 30 percent of their salary on rent (KPCC). 
  • Who knew that the letters "F" and "U" could be so controversial? The Motion Picture Association of America deemed the artwork for the film "Fed Up" as having offensive language, but later reversed its decision (Deadline). The artwork featured the letters "F" and "U" together.


Los Angeles Register debut: Good luck finding it on newsstands

L.A. Register

The Los Angeles Register debuted on April 16, 2014.

Elizabeth Aguilera

Good luck finding one of these new L.A. Register news racks.

Village Center

Ben Bergman/KPCC

At the Village Center News Stand in Westwood The Los Angeles Register was nowhere to be found.

The new Los Angeles Register newspaper debuted Wednesday, and I wanted to check out the first edition. Publisher Aaron Kushner has relentlessly focused on print over digital, so I thought it best to experience the paper by holding it in my hands, which is easier said than done.

Home delivery isn't coming until next month, but the Register says 5,500 retail and newsrack locations across Los Angeles carry the paper, including "major grocery and convenience stores such as 7-Eleven and AM/PM." 

So this morning I drove to my local 7-Eleven. They carried copies of the L.A. Times, USA Today and lots of tabloids. But no L.A. Register.

Then I went to a Chevron station. They only had the Times.

Next stop: Whole Foods. A clerk told me they only carry magazines, not newspapers.

Finally, I knew where I had to go: a good old-fashioned newsstand. So I drove to the venerable Westwood Village News Stand. They had stacks of the New York Post, and the Financial Times, but no Register.