As president and chief executive of Fletcher Jones Management Group, Jones has spread his dynasty from one car dealership his father began in 1954 in Los Angeles to 18 in the West, Midwest and now Hawaii.

Jones took over five franchises at seven dealerships in Hawaii on Thursday. Those brands include Mercedes-Benz, two Honda dealerships, Land Rover, Jaguar and Porsche.

Jones is no stranger to the luxury car business.

The company's Fletcher Jones Motorcars of Newport Beach (Calif.) holds the title of the United States' top Mercedes seller, according to business directory Hoover's Online.

In Las Vegas, Jones owns Fletcher Jones Imports Mercedes-Benz, 7300 W. Sahara Ave., and Fletcher Jones Lexus, 6600 W. Sahara, in addition to Fletcher Jones Toyota, at Sahara just west of Boulder Highway.

In Reno he owns Jones West Ford. In Chicago he owns Mercedes-Benz of Chicago, Fletcher Jones Audi, Fletcher Jones Infiniti, Fletcher Jones Nissan, Fletcher Jones Honda and Fletcher Jones Volkswagen.

In Las Vegas, Jones recently moved his Mercedes dealership to a 225,000-square-foot building on West Sahara. It offers amenities such as indoor showrooms, Starbucks coffee stand, manicurist and shoe shine station.

Jones talked with In Business Las Vegas about the car markets in Las Vegas and nationwide, and plans for expansions in the valley.

Question: Your company is obviously bullish on the Las Vegas market, having just opened an upscale import center featuring Mercedes on West Sahara Avenue. How much was invested in this project and what prompted your company to commit to that investment and relocate from the location on Rancho Drive?

Answer: The total investment was substantial, well over $20 million. The move from Rancho to Sahara was just a natural. It gave us more space, but it also gave us more exposure. A large part of our clientele were moving in this direction, so it just made sense. We also have a service facility on Sunset (Road), which is more toward the Henderson area, which is also a large customer base for us. We are very bullish on Las Vegas obviously with the growth, and we think that will continue. Also if you look at the projected growth numbers for Mercedes-Benz between now and 2009, they're forecasting a 50 percent increase in their new car business. That's after about a 100 percent increase in their new car business between 1992 and 2003. So it's very bullish. We've also doubled the size of our Henderson service center in the last 12 to 24 months.

Tell me about your newest dealership in Las Vegas and what makes it different from other dealerships in town.

The dealership here is a little bit more than 225,000 square feet under roof. Why that's important is not only the additional service facility, with 54 service stalls, which is more than double our original facility on Rancho, but we also have three indoor showrooms, one of which is a basement that holds over 125 new cars. We felt one of the biggest amenities is the ability to shop indoors regardless of how hot, cold, or how windy it is. Some of the other special amenities we offer, we have a Starbucks coffee bar, we have a manicurist, we have a shoe shine station, and a very large not-just-parts boutique, but accessories, clothing and lifestyle items.

Is offering these amenities important to your customers?

We started this at our dealership in Newport Beach (Calif.) in 1997. First of all, we really try to make this the same type of experience clients receive when they are shopping at Neiman Marcus or Saks (Fifth Avenue) or Tiffany's, or stay at a Four Seasons Hotel, and we've designed the building that way. We've also trained and talked to our associates to feel the same way about themselves and about the facility and how they treat our clients. We found that it has definitely helped and it's raised the level of services and client care.

What are your annual sales projections for the new location in terms of dollars or units sold, and how much would that compare to the previous location?

We're forecasting 1,800 to 2,000 new Mercedes-Benz for 2004. That would be double from our previous location, about a 100 percent increase. The pre-owned Mercedes-Benz and other pre-owned makes would be 1,200 for this coming year, and that would be about a 50 percent increase from the prior location. In parts and service sales we're projecting similar percentages of growth, based on more cars sold and more cars in our market.

How does Las Vegas compare to your other markets in California, Hawaii and Chicago for the sale of luxury cars like Mercedes and Lexus? On a percentage basis are luxury sales here higher or lower than your other markets, and why?

I would say that Las Vegas is very similar to our markets in Chicago and Hawaii. The market in Newport Beach is very unusual because it's so densely populated with luxury car demographics. It's almost 100 percent of the market there, so our percentage of the market there is quite a bit higher, not just from Chicago or Hawaii but from really any place else in the country. It's a very unusual market. But Las Vegas compares favorably with Chicago and Hawaii, both for Lexus and Mercedes-Benz.

What are you doing with your Rancho Drive property?

We are in escrow right now with some people, and I believe they are going to develop it as part retail and part storage/industrial. Hopefully that will close in a month or so. That was a total of 12 acres, but we weren't using all of it. The portion being used for Mercedes-Benz and Lexus was about 5 acres and there was another 2-acre lot that we overflowed into and another 5 acres that was just vacant land.

Do you have any other expansion plans locally?

Eventually we'd like to expand here in Las Vegas, possibly with a second Mercedes-Benz dealership and a second Lexus dealership in the next five to seven years.

The competition appears to be pretty intense in Las Vegas. Are there too many dealerships here?

I really can't speak to that. We have Toyota, obviously, and they added a fourth Toyota dealership here. I think the valley is just getting to the point you almost need that many to cover the geographic area. If it's not necessary right now, it will be in the next few years.

Besides Hawaii, what other areas nationwide are you looking to expand to?

We look at these deals as they occur. We're not identifying any particular market right now, other than the markets we are already in, to expand in as those opportunities occur. Hawaii was a market we knew was a good market, and a market I was familiar with, and the situation happened that there was an opportunity and we thought we'd do it.

How's the business climate in Southern Nevada and did the tax increases approved by the Legislature this year affect any of your financial projections?

We think the business climate is good in Southern Nevada. Any time taxes go up, it's not a good thing and we have to factor that in. We think with the opportunity here we can overcome that.

Your Las Vegas firm of Fletcher Jones Management was one of the largest contributors to Gov. Arnold Schwarzenegger's California gubernatorial campaign. The Los Angeles Times reported that you gave $57,600 to Schwarzenegger's campaign. Why did you support Schwarzenegger? Do you think a new California governor will stymie the tide of businesses leaving that state, some of which end up in Nevada?

I do think it will help with the businesses leaving. They weren't all coming to Southern Nevada -- they were going other places also, unfortunately, to Oregon and Washington. I think Gov. Schwarzenegger will make a difference. I think it's a great opportunity. To get a chance to get a moderate Republican elected in California is a huge step. I strongly relate and identify on his positions on different issues, and I'm excited about it.

Steve Wynn will have Maserati and Ferrari dealerships in his new Strip resort. Do you expect this to be a trend for local resorts to have exotic car sales at their casinos? Have you approached or considered approaching a resort about placing a dealership in a Strip resort?

I don't see it as a trend. It's pretty space intensive. This is certainly not cheap space in those resorts. It has as much to do with Steve's and his partners' love of automobiles.

In the past five years or so, big new car retailers like AutoNation and Tower Automotive have entered the Nevada market, while CarMax recently opened a dealership and is under construction with a second dealership. Did your management group entertain buyout offers from any of these companies? If so, does it still interest you to hook up with them?

No, not really. We had discussions with several public companies that contacted us, and it's just not something I'm interested in, being part of a public company. We feel like being privately owned allows us to be more responsive and to react more quickly than possibly a public company can.

One business issue we face locally is a shortage of qualified workers for some occupations. Have you had trouble hiring qualified people, particularly technicians? Are you doing anything to attract more young people to the profession?

We've been very fortunate in being able to attract some very high-qualified people, technicians in particular. That has been a problem in the past, but it seems to be getting less so now for us. Back to the environment and the facility here, I think that's part of it. I think we're attracting people not just local people, but also from out of state. I think if you're a Mercedes technician and you come to Las Vegas and you see the quality of life and then the quality of the employment environment here in these facilities, both Mercedes-Benz and Lexus, it's a huge plus for us. We have an apprentice program and a trainee program, where we're able to bring in younger, not totally inexperienced people, and move them and train them over a period of time, and that's been a tremendous plus for us also.

Lately there's been a union organizing effort locally for the auto technicians. Does your dealership favor or oppose dealing with a technicians' union?

We just don't think it adds anything for the technicians. We've been through this over the years, and there's been times that, two or three times that I can think of, that there's been this kind of activity. When we tell our story, and the union tells their story, it's up to the technicians to decide, but they've decided they're better dealing with us one-on-one than dealing with a middle man that they have to pay.

Another issue faced by businesses nationwide is rising health care costs. Bill Ford Jr. recently said health care costs exceed steel as the largest cost component of vehicles. How are you dealing with the rising costs of health care?

It's a challenge, it really is. It affects us and our employees because we bear a good part of that cost, but so do they for their families and dependents. So we're just doing it the best we can as far as shopping for not only the best rates but the best services and coverages.

With the exception of maybe Toyota and GM, the worldwide auto industry has struggled since 9-11, with Ford and Chrysler posting huge losses and now facing serious problems. The industry moved cars with low or cut-rate financing and other incentives. Is the industry hooked on these deals?

Yes, it appears that right now they are hooked on these incentives, just to keep the plants running. I'm told it's cheaper for them to spend that money on incentives and 0 percent financing than it would be to actually close the plants down. Because of their union contracts, they'd still have to pay their employees. I think eventually, with new product and concessions from some of their suppliers, and increased efficiency in their production methods, I think eventually they will get their costs down and will begin to show a profit again. I think they are both showing profits now, but they do have some challenges.

Do you think consumers will be willing to accept fewer incentives?

If it's the right product and it's the right price to begin with, you don't have to offer $5,000, three months after it's introduced to get it to sell. I think there needs to be some discipline on the manufacturers part, and some better marketing and some planning when they're coming out with these products.

Toyota sales appear to have held up nationwide. How is your Toyota dealership doing here, in comparison to other markets?

We're doing well here and we've experienced some good increases, and it's similar to other markets in the Denver region, which is where we are.

The Mercedes brand has taken some hits the past few years because of quality issues and now you're advertising new Mercedes for as little as $299 per month. What's DaimlerChrylser doing to bolster that brand and help you move more cars?

First of all, when we're advertising cars at $300 a month, it's due to the fact that Mercedes-Benz is entering new markets with new product. We have the C230 sport coupe that starts at around $25,000. So the $300 a month is an appropriate payment for that priced car. That's by design. A lot of the hits that Mercedes took on quality surveys are misleading. Some of it is because of their innovation itself, in that they've always been the leader in that. I think that when you get into new and ground-breaking technologies, it's more difficult. The other thing sometimes is that the technology is so far advanced that it's hard for our clients, even for us sometimes, to really understand it.

There's also an aggressive program to sell used, certified Mercedes. You're advertising used Mercedes for $30,000, $40,000 and even more than $50,000. Is the brand still that strong that someone would spend that kind of money on a used car?

Definitely. It goes back to the quality of the car and the value that's in the car. A pre-owned Mercedes-Benz is better than almost any new car I can think of. The certified pre-owned program that Mercedes-Benz has is very good and it adds a lot of value to these vehicles.

Are car buyers looking for fuel-efficient vehicles or are they more concerned about safety and performance?

I would say they are more concerned about safety and performance.

What do you tell Mercedes it could do to help you sell more cars? Same with Lexus and Toyota?

Most of the time, just give us more.

Jennifer Shubinski covers real estate and development for In Business Las Vegas and its sister publication, the Las Vegas Sun. She can be reached at (702) 259-8832 or by e-mail at js@lasvegassun.com.