LAKE ELSINORE -- A third auto dealership opened in the city this week, an expansion that managers credited to a growing and profitable business selling large, specialized trucks to plumbers, electricians and other companies.

Lake Buick-Pontiac-GMC opened Monday on Auto Center Drive, in the former location of Lake Chevrolet, which moved over the weekend to a larger building and lot just up the road. The two dealerships belong to the Paradise group, which owns Chevrolet dealerships in Temecula, Santa Paula and Ventura.

The new dealership is one of several large businesses to open this month in Lake Elsinore. A Lowe's Hardware store opened Thursday. A Staples office-supply store is scheduled to open this morning. A Costco wholesale center and a shopping center with a Home Depot hardware store are expected to open this spring.

Those businesses could generate some $150 million in annual sales, contributing some $1.5 million to Lake Elsinore's finances next fiscal year, according to city estimates.

The businesses follow torrid residential development in Lake Elsinore and other areas of Southwest County.

And brisk business at a range of building-related companies are driving the expansion for Lake Chevrolet. The dealership has seen heavy demand for commercial trucks, a low-profile but profitable class that includes large trucks such as the Ford F-550 and Chevrolet 5500, according to Ron Bailey, Lake Chevrolet's service director. Such "medium-duty" trucks accounted for just 4.4 percent of the cars and trucks sold in the United States in 2004, according to Fleet Central, an automotive research firm.

The class of vehicles falls between the "light-duty" pickups driven by most consumers and the "heavy-duty" tractor-trailers used to haul shipping containers or other industrial cargo.

Along with a handful of smaller trucks sold to businesses and municipal governments, medium-duty trucks accounted for more than 40 percent of the new vehicles sold at Lake Chevrolet last year, Bailey said.

"That number's going to change dramatically now that we're in the new facility," he said. "The potential increase is huge."

The smell of asphalt was still fresh Thursday morning at the new location, a quarter-mile north of Diamond Drive. The hundreds of commercial vehicles lined up there were a spackling of white on the dark pavement.

Despite the uniform color, commercial vehicles varied widely in body style. Some are delivered with a boom arm and a "cherry-picker" bucket that can raise an electrical worker to the top of an electric pole. Some trucks have beds outfitted with metal chests to accommodate the large, heavy tools used by maintenance workers.

At the previous location, near the interchange of I-15 and Railroad Canyon Road, tight parking often forced sales staff to park the white-painted trucks in nearby dirt lots, Bailey said. Sometimes they found themselves moving three trucks to show a fourth to a potential customer.

Moreover, Bailey said, Lake's service department wasn't always able to maintain and repair the largest vehicles it sold. The dealership's 31 service bays were sized for passenger cars and trucks and lacked some of the special equipment for working on commercial vehicles. Technicians made do with what they had but frequently had to turn customers away.

That was bad for customers, who themselves lose business when a truck is out of action. And it was particularly unfortunate for Lake to turn away such a high-margin business. Service typically generates higher profit margins than new-car sales, and Bailey said it was no different at Lake. Service accounted for more than 50 percent of the dealership's profit, more than new and used car sales combined, Bailey said. And service on commercial trucks can be even higher margin, he said. The dealer charges $96 an hour for medium-duty trucks compared to $86 an hour for cars and most light-duty trucks.

Bailey estimated that he's hired 10 new people for his service department. Several will work in larger service bays and will focus on the commercial and medium-duty trucks.

The new Buick-Pontiac-GMC dealership is hiring about 40 people to staff its sales and service departments. It opened Monday, even as painting, polishing and other preparations continue.

The city expects it to generate $400,000 in sales taxes next fiscal year, a figure that implies an estimated $40 million in sales.

Car dealers, gas stations and other transportation-related businesses yielded a total $8.25 million in taxes last fiscal year, about 42 percent of all sales taxes, according to city records.

Still, Bailey said, the new franchise might not have arrived if not for the Chevy dealership's need to expand. Burdened with fewer aggressive rebate programs from manufacturers and facing fewer nearby competitors, commercial vehicles can be pretty profitable for a dealer.

The closest dealerships selling commercial vehicles are in Escondido and Corona, also ideal locations, Bailey said.

"I stand out here and I look at this freeway and I see tons of these trucks going by, so the potential for service and sales business is good," he said. "We're in a great area."

Contact staff writer Chris Bagley at (951) 676-4315, Ext. 2615, or cbagley@californian.com. To comment on this article, go to www.californian.com.