Future called upbeat for LV economy

Wednesday, Jan. 26, 2000 | 12:07 p.m.

Economic trends

Keith Schwer, director for UNLV's Center for Business and Economic Research, made these observations as part of his Preview 2000 presentation:

There were no blockbuster announcements at Preview 2000 Tuesday.

But an all-star slate of speakers, including the former head of Blockbuster Entertainment, offered an upbeat assessment of Las Vegas' future.

Preview, an annual forecasting event organized by the Las Vegas Chamber of Commerce and the Nevada Development Authority, gives business leaders and economists a forum to explain what they see in the crystal ball.

For H. Wayne Huizenga, the man who made Blockbuster a household name, it was a look at the future of auto sales in Las Vegas.

For Jim Robbins, chief executive officer of Cox Communications Inc., it was the assurance that the convergence of computers, entertainment and a digital delivery system is well under way in the city.

And, for Alan Feldman, vice president of public affairs for Mirage Resorts Inc. -- a late pinch-hitter for Frank Fahrenkopf of the American Gaming Association -- it was to forecast a storm cloud on the state's gaming horizon as the industry gears up to do battle with the National Collegiate Athletic Association over wagering on amateur sports.

Huizenga, whose family of companies operates Clark County's franchised trash-hauling service, 10 Las Vegas car dealerships under the AutoNation umbrella, two hotels and two major car rental operations locally, explained how he went from a trash hauler with one truck to the leader of the nation's largest car dealer franchise in 38 years.

Today, AutoNation has 380 franchised dealerships in 20 states. Huizenga is chairman and director of AutoNation Inc., a publicly traded company based in Fort Lauderdale, Fla., and he owned 6.4 percent of the company's stock in October.

An AutoNation megastore in Henderson closed its doors in December and the company announced it was moving its used-car sales to its individual dealerships.

AutoNation also owns 63.9 percent of Republic Services Inc., another Fort Lauderdale-based public company. Republic operates 131 non-hazardous solid waste collection companies in 26 states and 70 transfer stations and 48 solid waste landfills. Huizenga serves as chairman of that company.

Huizenga chalked up his success to two key factors: knowing how to treat customers with respect and giving them the best deal for their money. Huizenga said he plans to duplicate in Las Vegas and other AutoNation cities the success he has had in Denver with an initiative his company calls the "Mile High Project." The basic concept is an AutoNation standard -- offering one price with no dickering on car sales.

"We don't consider it revolutionary," Huizenga said in his 20-minute presentation at the Thomas & Mack Center. "We just look at it through the eyes of our customers, it's just common sense."

In Denver, the strategy boosted the company's market share to 22 percent. Nationwide, AutoNation had $20 billion in revenues last year, he said. Huizenga said he developed a strategy of acquiring companies and consolidating them in the fractured waste-hauling industry in the 1970s. He decided to apply the same strategy to the home video rental business and bought Blockbuster when it had 19 stores.

Among the stores he acquired in his consolidation effort in 1988 were those in Las Vegas' Major Video chain. At the peak of growth, Huizenga said he opened a Blockbuster store every 17 hours and when he sold the chain, it had 6,300 stores in 25 countries.

Huizenga used the proceeds of the Blockbuster sale to finance AutoNation. He also has dealings in professional sports and owns the National Football League Miami Dolphins and the Florida Panthers National Hockey League team. He sold his interest in Major League Baseball's Florida Marlins.

The company's ownership of the National and Alamo car rental divisions gives him a source for used cars at his dealerships.

In addition to the car rental agencies and AutoNation in Las Vegas, Huizenga operates 610 hotel rooms through his Extended Stay America franchise and Republic Industries Inc. operates Silver State Disposal, the trash-hauling company. Huizenga figures that between all his holdings nationwide, he collects $1 billion in revenue a day with a hefty percentage coming from Las Vegas, where Alamo is the market leader.

For Robbins, the head of Cox Communications, it was a return to the city where Cox bought the city's dominant cable television company 16 months ago from a partnership that included the Greenspun family, which owns the Las Vegas Sun.

The Greenspuns still hold a minority interest in the cable company.

Robbins told the audience that he was stunned by the recent announcement of America Online's acquisition of Time Warner, but that he "likes the marriage." He said his company has been in contact with AOL Chief Executive Steve Case about possible deals involving Cox, "but it's too soon to tell" about details.

Robbins said Las Vegas' feverish growth has put Cox on a pace to average 600 installations a day. Since the Cox acquisition, the company has grown by 8 percent to 340,000 subscribers. Robbins said within two years, the company will grow from 800 to 1,200 employees to keep up with demand. The company plans to build a new headquarters at Rancho Drive and Bonanza Road.

Since the Las Vegas system acquisition in October 1998, Cox said picture reliability has reached 99.9 percent and the company has reduced its number of service calls by 40 percent.

Like Huizenga, Robbins believes customer service is what separates his company from others.

"Cox is to cable what Nordstrom is to retail," Robbins said of his company, which this year plans to rename its state-of-the-art digital package to "Cox at Home."

With its expanded capabilities, Atlanta-based Cox is able to offer more cable television stations, high-definition television and high-speed Internet access. Robbins said the company is in the process of providing cable access to the city's schools through the "Cox Line to Learning" program.

Tuesday's Preview program also included presentations by UNLV President Carol Harter, who urged a partnership between the university, the state government and business to diversify Nevada's economy; and entertainer David Cassidy, who asked the public to give back to the community through volunteer work.

Donald Marinelli, co-director of the Entertainment Technology Center at Carnegie Mellon University, discussed how Las Vegas is well positioned to use technological advancements to entertain its millions of visitors and Richard Lee, director of public relations for First American Title Co. of Nevada, delivered his trademark video presentation chronicling what developments will open or be under construction in the year ahead.

Show attendees also visited about 70 booths on the arena's concourse level during the half-day event.