Las Vegas escapes GM purge

Southern Nevada’s 15 General Motor dealers ended a white-knuckle wait for franchise termination notices Friday, and one key dealer believes they all escaped unscathed.

“My people have been at wit’s end for two weeks,” said Greg Heinrich, president of Fairway Chevrolet, Henderson Chevrolet and the Pahrump Valley Auto Plaza. Like workers at other dealerships, his employees feared they would lose their jobs, he said.

“I woke up at 3:30 this morning,” he said.

“Our business is off considerably, but we’re holding our own,” Heinrich said.

Sales are off about 60 percent, which is common in the new-car sector, he said. The company has cut hours and pay because of the sales slump.

However, Heinrich, who is co-chair for the Chevrolet National Dealership Council, said none of his stores were notified of franchise termination. He said he believes that none of the GM new-car dealers in the area are being terminated, either, although he heard unconfirmed reports that GM will not renew the franchise for one dealer in Northern Nevada.

Wayne Frediani, executive director of the Nevada Franchise Auto Dealers Association, said his information supported Heinrich’s report.

GM notified 1,124 dealers, or about 20 percent around the country, that it does not intend to renew their franchises in October 2010. There are 25 dealers in Nevada.

Chrysler LLC disclosed the names of 789 terminated dealers, including four in Southern Nevada, on Thursday, but GM said it would not reveal the identity of dealers on its list.

While Chrysler said it would not reconsider terminated dealers, GM will allow dealers to appeal the decision, according to Automotive News.

GM on June 1 will send notices to 400 to 600 more dealers with borderline performance results, Heinrich said.

For the first round, termination letters went mostly to small dealers with low sales volumes, analysts say.

Findlay Chevrolet ranked No. 1 among GM dealership for retail sales in Nevada last year. General Manager Justin Findlay believed his dealership would avoid being cut but he couldn’t be sure.

“I do think it created some uncertainty within our work force,” Findlay said.

The cutback in GM and Chrysler dealerships is reverberating throughout the state’s economy.

“What it shows is that Northern Nevada and Southern Nevada are not immune to the difficulties being faced by the economy as a whole,” said Bill Anderson, chief economist for the Nevada Department of Employment, Training & Rehabilitation.

Anderson said his office expects to address the effect of dealer terminations on the economy in the monthly unemployment report next week. The state reported a 10.4 percent unemployment rate for March, higher than the national average and the highest in Nevada since 1983.

New- and used-car sales are the second-largest source of sales taxes in the state, behind gaming, Frediani said. His organization represents 115 new-car dealers that employ 1,100 workers.

The reduction of new-car dealers in Nevada will reduce city, county and state sales tax revenues, Frediani said.

Sales taxes for automobiles, parts and service totaled $162 million in Southern Nevada in February, down 43 percent from a year ago, said John Restrepo, principal of Restrepo Consulting Group and vice chairman of Nevada’s Economic Forum.

Automobile, parts and service revenues have been declining for 16 months, Frediani said.

The most immediate effects of dealership closings are on employees who lose jobs and suppliers and vendors who lose business sales, Restrepo said. For example, he said, some dealers subcontract for body shop work.

Pat Clark Auto Showcase avoided the worst of the storm, said general manager David Pyles. It sold its franchises for Buick, Pontiac and GMC last July, he said. The dealer was selling more used cars than new cars anyway, he said.

“Mr. Clark is looking like a pretty smart guy right now,” he said. “We had no clue of what was coming.”

GM needs to reduce the size of its dealer network because it costs the automaker to provide support for dealers, said GM spokeswoman Susan Garontakos. GM incurs expenses through incentives, employee training, advertising and information technology.

Frediani rejected her arguments.

“There’s no cost to (the automakers),” Frediani said. “It’s (the dealer’s) capital. It’s his business. It’s his employees. Why would you give a damn how (the dealer) does as long as he buys your product and services your customer.”

Eliminating dealers, many of them family-run businesses, “will do nothing” to correct financial problems at Chrysler and GM, he said. “It’s pretty sad and pretty disappointing.”

Contact reporter John G. Edwards at or 702-383-0420.

Nevada's solar industry on the rebound
In 2015, the Nevada Public Utilities Commission voted in favor of a new tariff structure that reduced net energy metering buyback rates and increased fix fees for residential solar customers.
Apartment complexes selling fast in Las Vegas
Las Vegas’ apartment vacancy rate is among the smallest in the country, and rents are climbing faster than the national average. (LVRJ)
Aristocrat Opens $45M Campus In Summerlin
Aristocrat Technologies Chairman Ian Blackburne discusses the company's growth. (LVRJ)
Sunrise Hospital celebrates 60 years
Sunrise Hospital opened its doors to patients on Dec. 15, 1958. Employees of more than 35 years celebrated at a luncheon Wednesday, Dec. 12, 2018. Jessie Bekker/ Las Vegas Review-Journal.
Maya Cinemas to open soon in North Las Vegas
Moctesuma Esparza, CEO of Maya Cinemas, talks about the newest location in North Las Vegas, set to open Jan. 10. The aim of the theatre chain is to serve latino-centric, underserved communities.
Holiday shopping and returns make this the busiest time of year for UPS
The UPS Las Vegas South facility is the company's busiest pre-load operation in the country, and it's even busier this time of year. (K.M. Cannon/Las Vegas Review-Journal)
Primm’s outlet mall has fallen on hard times
The mall, attached to Primm Valley Resort, opened in 1998. Back then, it was a “textbook, perfect outlet-center location." But now, Primm’s outlet mall has fallen on hard times. Las Vegas Boulevard has endless shopping spots. And there are other outlet malls that don’t require a hefty drive to the state line. Its mortgage-holder foreclosed on the mall in late September.
Miltary auction at Ritchie Bros. Auctioneers
Humvees, ammo cans, construction equipment, field gear and more is on the auction block Friday and Saturday at Ritchie Bros. Auctioneers. About 10,000 items in all are for sale in what GovPlanet bills as the largest auction of its kind.
Las Vegas residents discuss avoiding holiday scams
Las Vegas residents discuss their donation habits and how they avoid giving money to scam charities during the holiday season. (Bailey Schulz/Las Vegas Review-Journal)
Tesla’s Nevada Gigafactory ahead of economic impact expectations
The Tesla Gigafactory’s economic impact on Nevada has exceeded projections, bringing in more than 7,000 jobs. In 2014, Nevada agreed to give the automotive and energy company $1.3 billion in tax abatements. In return, Tesla promised to meet certain requirements in areas like employment and capital investment. As of June, Tesla has brought in a total of $6.05 billion in capital investment, surpassing the $4.95 billion projection. The original contract gave the company until 2024 to make $3.5 billion in capital investments in Nevada. Derek Armstrong, deputy director of the Governor’s Office of Economic Development.
Land sales near the Las Vegas Raiders stadium
Land around the Las Vegas stadium site has been selling for high prices. A few months before the stadium’s groundbreaking, Global Trust Group acquired a 2.5-acre parcel just north of the stadium site. The property sold for $7.25 million, or $2.9 million an acre. Osprey Real Estate Capital and Huntington Hotel Group acquired a 2-acre industrial site just west of the stadium site in late November. The property sold for $6.5 million, or $3.15 million per acre. That's roughly 12 times the average price of land in the valley this year as tracked by Colliers International.
T-Mobile Tech Experience Truck parks in Toshiba Plaza at T-Mobile Arena
The Tech Experience Truck is a state-of-the-art showroom on wheels, with demonstrations that put connected drones, smart cities, augmented/virtual reality and smart tracking. The exhibit shows new wireless technology – including 5G and the Internet of Things (IoT). (K.M. Cannon/Las Vegas Review-Journal)
Steve Siegel, CEO of the Siegel Group, speaks about helping families and other needy residents
Steve Siegel, CEO of the Siegel Group, speaks about helping families and other needy residents to keep them from teetering off into homelessness. Bizuayehu Tesfaye/Las Vrgas Review-Journal @bizutesfaye
Crowds camp out for Chick-fil-A opening
Dozens of customers camped out 24 hours ahead of the 6 a.m. Thursday opening of the new Chick-fil-A on Rainbow Blvd.
Cheapest listings for sale in Las Vegas
Listed for $39,990, 585 S. Royal Crest Circle, Unit #9 is one of the cheapest homes currently listed for sale in Las Vegas. (Caroline Brehman/Las Vegas Review-Journal)
MGM's sports betting deals
MGM Resorts International signed a sports betting sponsorship agreement with the NBA in July It was the first professional sports league to have official ties with a legal sports betting house. The deal came just two months after the U.S. Supreme Court overturned a law prohibiting sports betting in most states. In October, MGM became the first gaming company to sign a sports betting partnership with the NHL. In November, MGM became the first gaming company to sign a sports betting partnership with the MLB. Financial terms of Tuesday’s deal and earlier partnerships have not been announced.
Terry Miller discusses Convention Center
Project Manager Terry Miller explains the phases of Convention Center construction.
Zappos treats their team members on Cyber Monday
Zappos rolls out a variety of food, drinks and special activities for all team members at their downtown Las Vegas headquarters for Cyber Monday. (K.M. Cannon/Las Vegas Review-Journal)
Team Hybrid at the 2019-Model Motor Trend International Auto Show
Among the companies showing off the 2019 model cars, Team Hybrid shows off its modified cars. Las Vegas resident David David talks about the team, which is in its ninth year exhibiting at the show, and his show car.
Black Friday Shoppers at downtown Summerlin and at the Arsenal
Black Friday shoppers at downtown Summerlin and at the Arsenal. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfYe
Black Friday shopping in Las Vegas
Black Friday sale shopers express their shopping experience. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfaye
Las Vegas Livestock recycling Strip food waste
Las Vegas Livestock collects and recycles food from many Las Vegas Strip companies. (Nicole Raz/Las Vegas Review-Journal)
Black Friday at Fry's
Shoppers line up for deals early on Black Friday at Fry's Electronics on Las Vegas Boulevard South. (Mat Luschek/Las Vegas Review-Journal)
Black Friday shoppers at Best Buy at 5 am
Black Friday shoppers at Best Buy at 5 am on Nov. 23. (Mat Luschek/Las Vegas Review-Journal
Black Friday - 1am Closing Time
Quiet night.
Black Friday - 12:30am - Best Buy Arroyo Crossing
Sam's Town Holiday Lighting Ceremony
On Wednesday, Nov. 21, 2018, Mystic Falls Park opened with its annual tree lighting ceremony, hosted by Boyd Gaming Executive Chairman Bill Boyd. The attraction features a Winter Wonderland theme and holiday-inspired laser light show, available daily Nov. 23 to Jan. 1. (Mat Luschek/Las Vegas Review-Journal)
What Is A Smart City?
George Karayannis, vice president of CityNow, Panasonic’s smart-city arm, explains. (Nicole Raz/Las Vegas Review-Journal)
Walmart uses virtual reality to train employees
Walmart Academy Facilitator demonstrates the VR training program being used by Walmart stores across the country.
With holidays around the corner, department stores hiring extra staff
J.C. Penny hired 72 seasonal workers this year at the Galleria at Sunset mall in Henderson in order to handle the heavy traffic of the holiday shopping season. (Rachel Aston/Las Vegas Review-Journal)
News Headlines
Add Event
Home Front Page Footer Listing
You May Like

You May Like