Eyes on the future: Carson City Hohl dealerships expanding

A years-long partnership between a family-run car dealership and a local building firm has led to a sizeable investment in one of Carson City’s most important revenue sources: motor vehicles and parts.

“Being a Carson City-based company who has a western region reach, this project is important because really, we don’t want anyone else building in Carson City if we can help it because this is our home base,” said Bryce Clutts, president and CEO of Metcalf, formerly known as Metcalf Builders Inc. “We buy our vehicles from the Hohls. We have a relationship with them. Anytime you can keep it local, let’s keep it local.”

Metcalf recently broke ground on two expansions in Carson’s auto row. One is for Michael Hohl Chevrolet GMC at 3700 S. Carson St., and the other is for Michael Hohl Subaru at 2910 S. Carson St. The former, expected to be completed by March, entails three buildings, including a 20,258-square-foot, two-story service building addition, a 3,000-square-foot storage building and a 1664-square-foot car wash. The Subaru expansion, expected to be completed by May, includes a 22,778-square-foot, two-story service building addition.

Clutts put total construction costs for the two projects at $15.6 million. Founded in 1994 by father and son — Red and Tom Metcalf — the construction company built the Honda and Subaru dealerships that opened in 2010, not to mention well-known buildings around Carson like Galaxy Theaters and the Carson City Sheriff’s Office.

“Ironically we’ll be celebrating our 30th year next year when we open these buildings, and they (the Hohls) will be celebrating their 40th,” Clutts said.

In an interview with the Appeal, Michael Hohl Automotive owners Tim Hohl and Matthew Hohl talked about the recent past — the COVID-19 pandemic and international supply chain issues — and the need for expansion, especially with the rise of electric cars. They also talked about the company’s history.

Parents Michael and Karen Hohl started the dealership in Carson City in 1984. In 2008, the company entered an agreement for redevelopment incentives to relocate the Honda and Subaru dealerships to their present spots. In 2012, the agreement was amended to include, among other things, a remodel of the Chevrolet GMC location. In April of this year, the city and redevelopment authority released deeds securing the $4.8 million loan, which had been paid in full.

“Principal and interest on the loan were repaid each year by allocating 20 percent of the Basic City-County Relief Tax and Supplemental City-County Relief Tax (2.25 percent of the 7.6 percent city sales tax rate) revenue the city received each year from the dealerships until the loan was paid in full,” City Manager Nancy Paulson said by email. “In exchange for the financial assistance provided by the city and RDA (redevelopment authority), the Hohl Group committed to maintaining business operations in (redevelopment) Area 2 for 30 years.”

On the new expansions, Paulson added, “The city is so thankful for all the businesses that choose to invest in our community. A sizeable expansion can only be good news for Carson City increasing employment opportunities, contributing to our local economy and improving the quality of life in Carson City.”

“It feels great to be out of the agreement with the city and having fulfilled our side of things,” said Tim Hohl, “and hopefully made the community a better place for us and for everybody.”

Motor vehicles and parts are the biggest segment of taxable sales in the city. Sales tax revenue is categorized as part of intergovernmental resources, which make up 24.7 percent of the city’s revenue. That compares to property taxes, which generate 16.7 percent of the city’s revenue, Mayor Lori Bagwell told Chamber of Commerce members in May.

“Where are you buying your cars?” Bagwell asked the audience at the time. “Carson City. Because that is what? Our number one sales tax base is the cars.”

It’s a segment that has grown with investment. In fiscal year 2010, around the time the new Honda and Subaru dealerships were opening, taxable sales for motor vehicle and parts dealers in Carson City were roughly $154 million from 90 filing locations, according to the Nevada Department of Taxation. In contrast, the report for fiscal year 2022 shows a little more than $410 million in taxable sales in the category from 136 filing locations.

Even fiscal year 2020, the end of which was hampered by the pandemic, taxable sales for motor vehicle and parts dealers in Carson City were at $358 million, roughly.

The pandemic did present challenges for the Hohls. Matthew Hohl described doing away with test drives and selling cars outside to accommodate separation rules. But business picked up after initial adjustments.

“The last couple of years, sales have been good for us,” he said.

Tim Hohl put it another way: “We can’t service as many cars as we’re selling.”

The new service buildings are a result of those sales and will be able to accommodate electric vehicles.

“When we work on a car that is an electric car, when we receive it off the truck from the factory, when we work on it, whenever we touch one, we’re responsible to have to charge that electric car,” said Tim Hohl. “And then part of doing business in the electrical space is you have to be able to show a customer how charging works. You have to test drive it now, and then in an hour test drive it again, so we need to be able to charge all this stuff.”

“And the floorspace for the ability to work on it,” added Matthew Hohl.

The Hohls said EVs are still a small percentage of sales because supply chain issues have complicated getting enough cars. For instance, a waiting list for EV Hummers has upward of 200 people with only a handful of delivered vehicles so far.

“We’re getting a lot more consumer questions,” said Matthew Hohl. “The demand is steadily rising.”

Manufacturers will dictate EV options, Tim Hohl explained.

“You know, GM has been probably a little bit more clear than most manufacturers and said that by 2035, everything they sell will be electric,” he said. “We are maintaining that based on our client base and our driving conditions that we’ll be behind the curve a little bit on adoption.

“Five years from now, I still think that we’re in the move-towards-it phase. Ten years from now, they’ve said that we’re pretty much there.”

At the same time, the Hohls don’t see internal combustion engines going away. Hohl pointed out the company still works on cars that are 30 years old. And whether customers are dealing with gas, hybrid or full EV, supply chain issues — like a shortage of microchips — persist.

“It’s a moving target. Every model, every brand, has something that will pop its head up that turns into a real headache,” said Tim Hohl. “As a lot of things have gone through the pandemic and post-pandemic, the nicer, most expensive stuff has been some of our most popular. You know, we still can’t keep Corvettes and Escalades and all these $100,000-plus cars in stock. They’re just flying off the shelves. And those take obviously more microchips than the work truck that your radio is your fancy item in there. So, we’ve struggled to get enough availability on those items.”

Long-term, however, the Hohls are optimistic about the automotive market in Carson City.

“Carson has been very good to us, and we’ve got a lot of great customers, and we’ve had a lot of great history here … employees, everything,” said Tim Hohl.

The company employs around 270 people.

“This is a local community that I think takes care of each other,” said Clutts, adding Metcalf has nearly 60 employees. “These are two businesses that are helping drive this local economy, and we’re doing it together. I think that’s what makes Carson City and Northern Nevada in particular unique … is that you kind of look out for each other.”