PROM CLIENTS MAY FACE LIMO SHORTAGE: As the recession forces fleet reductions and some operator closures, the supply of limousines for prom night may be a bit tight this year, says Steve Levin, owner of Sterling Rose Limousine in Temecula, Calif., and a 2008 Operator of the Year Award winner. His latest assessment below. . .
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BUS BONANZA: I had a Q&A interview with Eron Shosteck, the American Bus Association's senior VP of communications, marketing, and media relations. More details below. . .
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KENTUCKY LIMOUSINE ASSOCIATION: Carey Fieldhouse, the president of the KLA and owner of R&R Limousine in Louisville, Ky., told me today about a helpful prom-season idea for operators and associations: A list or directory of all high schools and their prom dates. The KLA had a staff member reach about 70% of all the high schools in Kentucky and get dates and details of their proms. The list was then distributed to operator-members looking for prom season business. One question we have at LCT is: HOW IS THE RECESSION AFFECTING PROM SEASON RESERVATIONS? -- M.R.
WATCH OUT: California ex-governor turned mayor of Oakland turned attorney general Jerry Brown is cracking the whip on worker's comp. His latest lawsuit filing
goes after what he considers to be a fake employee-owned company business model being used to avoid worker's comp payments. It's all part of an underground economy where business owners are avoiding worker's comp and payroll taxes funding disability and unemployment insurance programs, according to the LA Times article. In this suit, the state is asking for civil penalties of at least $300,000 from Contractors Asset Protection Assn. Inc. of Rancho Santa Fe. This is serious business requiring staying current on state regs, and watching out for affiliate work and joint ventures with companies not staying legit. -- J.L.
TIGHT TEEN-AGE BUDGETS: With prom season just ahead, operators may want to consider how the recession affects the seniors renting limousines.
This article offers a valuable insight into what's happening among seniors nationwide; the good news is they still want the limousines for a once in a lifetime event; the bad news is some are either losing jobs or hours, and really must save and scramble to foot the prom bill.
Operators should be aware of this in pricing and making flexible deals for limo prom rentals. Tuxedo stories are taking that approach; question is, if you have to cut something out, should it be the tux or the limo? Well, here's to arriving in style at the casual prom. . . -- M.R.
PASSINGS: Our thoughts and prayers are with H.A. Thompson and his family as they mourn the loss of his wife, Lucille. H.A. is founder and owner of Rose Chauffeured Transportation in Charlotte, N.C., a 2008 LCT Operator of the Year Award winner. H.A. has one of the most optimistic and generous personalities in the industry, evident in his seminars, articles, and conversations. H.A. offers a tribute below. . .
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INDUSTRY IMAGE: Please say it isn't so; the self-professed Octo-Dad is described as a "local limousine rental service owner." He claims he's the fertilizer of the Octo-Mommy flock. We'd prefer no connection between the Octo-Spectacle and our distinguished industry, but if he indeed is the ill-seeded progenitor, then at least refer to him as a "chauffeured transportation provider." One question: Is he legal? Does he have a TCP license in California? We suggest that if he turns out to be DNA Daddy of all those ducklings, then he better have a 16-pack Hummer stretch in his fleet. -- M.R.
NEW EDITOR JOINS BLOG: Linda M. Moore, our new Associate Publisher and East Coast Editor, joins LimoCentric as a regular contributor. Her vast expeience in limo publishing, managing, operating, writing, etc, no doubt will enhance all the content fanfare and drama we try so hard to maintain. Her first post below. . .
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GOOD USE OF TIME: Jim Luff discusses social networking and community involvement.
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GREEN TESTING GROUND: Red Oak Transportation of White Plains, N.Y., says it will be using 3,696 less quarts of oil and 288 less oil filters per year because it started using micoGreen filters. This will
reduce maintenance expenses 56% this year, according to coverage in Aftermarket Business. Red Oak chose microGreen convinced it was worth the return on investment. "With many green products, there is a high capital cost that takes years to recover and we were pleasantly surprised to learn this was not the case with the microGreen filter," said Andy Stoppelmann, CEO of Red Oak Transportation. There are many green fleet products being marketed these days, and it's not easy to make purchase decisions tied into your green program and cost cutting reality. The great thing about fleet managers is they're putting lots of mileage onto a small, medium, or large number of vehicles. They're testing them out and learning what works and what doesn't. So, spread the word on what is/isn't working for you, and keep us informed, too. -- J.L.
RECESSIONARY RIDE: Privately owned
Fidelity Investments reports that its employee share values increased in 2008, but 18% less than they did the year before. Analysts believe this is a good place to be during a recession that has plummeted many investment firms downward. A Moody's Investors Service analysts think that Fidelity has had a downturn through its subsidiaries including BostonCoach, real estate investments, and a Maine tomato-growing enterprise. BostonCoach has had to cut down on its costs and has had less affiliate work to send out, according to operators we've talked to. It's a good thing to be in the Fidelity Investment family at this point though since the parent company looks like it will get through this down time fairly well, and BostonCoach will benefit from this back up. -- J.L.
CALIFORNIA CRAZY: California is the home of LCT Magazine, but we must admit that our state can be a royal embarrassment. Because liberal legislators have been too inept and greedy to keep the state budget balanced since the late 1990s, the annual vehicle licensing fee now must rise from .65% of the value of a vehicle to 1.15%. And guess which businesses are
affected the most? Those with fleets. Even moreso, those with luxury fleets. So the "car tax" on a $70,000 limousine will rise from $455 per year to $805 per year. This is just one more hurdle for the chauffeured transportation industry in California, which already faces enough of an anti-business climate. We urge operators and the GCLA and its lobbyist to look into offsets, exemptions, and/or legislation that can at least spare providers of ground group transportation the dreadful car tax inrease. Whether the vehicle is a bus or limo, they're both greener, safer, and more efficient than self-transportation since they take vehicles off the road. Sounds like an industry ripe for a tax rebate or giveback. -- M.R.
PROM BUS: Palo Alto High School in California's bay area
has decided that stretch limos are not okay for the prom, but buses will provide the transportation. School administrators say that limos are too expensive and buses are more practical. Students are disappointed in missing out on limo rides and think of buses negatively (who wants to ride a school bus?). What about providing limo buses or minicoaches for the prom? Would this comply with the new school rules? This would offer more affordable per passenger trip costs and provide loads of luxury, comfort, and yearbook photo opps. -- J.L.
FEDERAL 
JUDGES RULE: There you have it; a panel of FEDERAL! judges in Tampa have ruled that a Prius is not a limo. We hope this case sets a precedent nationwide, and delegitimizes the mousy little Prius as both a limousine and a livery vehicle. Using a skimpy Prius instead of a Town Car is like substituting a scrap of tofu for Prime Rib.
If we're going to consider the Prius for a limo, then, what the hell? Why not an xBox or a Matrix for a hearse, with the coffin sticking out?
We at LCT must admit that we get excited about the Oscars; NO, not because of the gaudy designer dresses, but because of all the LIVERY finery on display.
What really amuses us is the celebrity Prius shuffle; show up in the little Eg(g)o mobile, and then leave out the back door after the ceremony in some big black SUV, sedan, or stretch limo to the parties. Amid all the politically correct green posturing and stage drama, we're glad to see the sleek, big, black, luxury vehicles still command the back office and the box office. -- M.R.
(Pictured is starlet Jessica Alba getting pulled over in her Prius because she tinted the windows beyond the legal limit to hide out from the Pooparazzi. Oh, the hazards of the Prius lifestyle!)
HOW'S BIZ? If your operations have been tracking the stock market since Jan. 20, then it can't be that good. Here is why you are still losing clients, selling vehicles, and sensing a growing malaise. Please let LCT know through the feedback funciton below if/when you experience any form of fiscal, economic, revenue, and/or profit stimulus. Speaking of which, is Nancy Pelosi using any black livery vehicles during her "working trip" to Rome? Maybe a stimulus for this industry can start there. -- M.R.
SIGN OF TROUBLED TIMES: A
Bloomberg News article about the cutbacks in corporate travel and perks starts off , of course, with an easy target: limousines. Alex Mashinsky, owner of LimoRes.net, is quoted. In our humbly biased opinion, the limo or the sedan is still a better value than a cab, a coach seat, or a rental car. Instead of giving bankers, executives, and managers bloated bonuses, how about rewarding them with frequent limo rides? -- M.R.
OPERATOR BATTLES DRY DESERT MARKET: One operator in Palm Springs, Calif., is offering a
new restaurant and bar hopping service. Great idea, but a few caveats. It only works if enough people have money to spend on dining out; and those who can dine out may not be willing to buy expensive drinks, opting to drive themselves. But the all-inclusive approach certainly delivers overall good value: safe, luxurious transportation with client costs offset by savings on gas and use of personal vehicles. And a DUI, of course, can run into the thousands. -- M.R.
OSCAR NIGHT: The Academy Awards will be handed out Sunday night, and it's probably the most important night of the year for LA-based operators. Delivering celebrities to the Kodak Theatre in green vehicles has become an industry ritual. This year,
Econation has teamed up with Toyota to promote transporting Oscar lovers in a 2010 revised Prius. "The entertainment industry is working to influence the rest of the world to use more sustainable options for transportation," said Ben Bloch,
a managing partner for Econation. The question always becomes: "Okay, so Leonardo DiCaprio showed up in a Prius. Did he demand to be switched over to an SUV two blocks away, right after the awards show ended?" DiCaprio is pretty darn serious about the green movement, so probably not, but other Hollywood stars and execs are making this request, according to operators we've talked to. Regardless, the trend looks like it's here to stay, and the same is true for many corporate transportation contracts worked out by travel managers, meeting planners, and sustainability officers. -- J.L.
NON-PROFILE IN COURAGE: When an operator doesn't have the b--- (brass?) to own up to basic facts and tries to manipulate an article. . .
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BUS SAFETY: A recent decision by the National Highway Traffic Safety Administration will increase seatback height on both large and small school buses, and mandates three-point seatbelts on smaller buses, according to BUSRide magazine. This is a major step forward for bus safety, and could be a sign that seatbelts will make their way to motorcoaches and minibuses through federal mandates. It's a controversial subject, or else it would have been adopted years ago, as it was for nearly all other passenger vehicles. Three-point seatbelts have brought a huge increase in passenger safety, and should make a positive difference when bus crashes happen. It's not yet clear how safe passengers will be if a bus rolls over, or when other drastic collision consequences take place. Increasing seatback height and three-point seatbelt usage is expected to substantially increase safety for school kids and drivers, and should increase safety levels for other passenger buses -- if it ever gets adopted across the bus industry. -- J.L.
ROYAL PARTY CAR: LCW Automotive is creating
yet another replica of a presidential limousine for those interested. CEO Ken Boyar says the limo will be ready for the public soon. LCW's previous replica (built during the Bush presidency) has been purchased and used by celebrities, international heads of state, the “West Wing” TV show, and the movie industry for films portraying the White House. The new Obama limo, code named "Stagecoach," will take much hard work to replicate since it's now a high security, sedan/SUV fusion, hybrid limousine. -- J.L.
GOTCHA: Luff foils a house burglary in progress. Man arrested when he calls for a limousine as a getaway vehicle.
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MACRO BLAME: The chauffeured transportation industry may occupy only a small sliver, or niche, of the overall private sector, but what happens among industry behemoths, such as banks, automakers, and financial institutions, often directly affects the fortunes of everyone from operators/owners to chauffeur/entrepreneurs. So it's important to maintain an accurate perspective of WHY the domestic and global economies are oozing away faster than a California mudslide. It also helps to point fingers at
WHO AND WHAT CAUSED THIS. -- M.R.
EXCELLENCE EXTRAORDINAIRE: I had the privilege of re-presenting the 2009 LCT Association Award of Excellence (Association of the Year) to the board members of the Greater California Livery Association last night before their first meeting of the year. LCT first announced the award during its annual gala in Las Vegas on Jan. 27, with GCLA President Alan Shanedling accepting it then. This was an honor long overdue. A panel of judges from the NLA Liasion Committee selected the GCLA from a group of three finalists that also included the Limousine Association of Houston and the Georgia Limousine Association.
Last night, the award was presented for the benefit of the membership which turned out in force at the Proud Bird restaurant near LAX. The GCLA stands at the cutting edge of industry advocacy in that it represents operators in the state with the most chauffeured transportation activity, and a state with a government that serves up operators with some of the most formidable regulatory and legislative hassles in the nation. California is often labeled a trrendsetter, and that certainly is the case with the GCLA; its success sets a model standard for other industry associations nationwide in advancing regulatory fairness and warding off crippling taxes, fees, and bureaucratic policies. Congratulations to the GCLA as the chauffeured transportation industry faces one of the toughest years in decades in a state with one of the most incompetent and wasteful governments. -- M.R.
IN MEMORIUM: LCT Magazine offers its condolences to Tom Mazza on the passing of his mother. Mazza has been a major leader and teacher in the chauffeured transportation industry who has helped professionalize chauffeured service. Obituary, below. . .
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LEADING STATES: California and Tennessee may have very little in common, aside from thriving music scenes in Los Angeles and Nashville. But both states rank number ONE in terms of the transportation industries served by LCT Magazine. Tennessee recently was ranked as the
No. 1 motorcoach desination by a top tourism publication. And Califronia consistently scores as the top state for chauffeured transportation activity, as proven by LCT's Fact Book findings. (New York City ranks as the top METRO area for chauffeured transportation). -- M.R.
TURNING GREEN: It's not a big shock, but corn-based ethanol is drying up out there.
Corn ethanol plants are constantly closing, and many hurdles are in place blocking other biofuels made from cellulosic materials like wood and sugar wastes. Biodiesel isn't a clear green solution for bus operators, either. Flex fuel and biofuel vehicles aren't going away right now, but it's not easy to find enough fuel stations, and whether the emission reductions, mileage, and cost per mile is worth the investment remains to be seen. -- J.L.
HOLDING ON: When a raceway gets rid of 9,000 seats to make way for more luxury motorcoach parking, then it must be in response to some type of demand. So far, motorcoaches, both passenger and luxury versions, appear to be bucking the worst of recessionary trends. The luxury motorcoach market has a lot of untapped potential that needs to be explored by chauffeured and charter operator alike. -- M.R.
NO ONE IS RECESSION PROOF: The luxury good and services sector, once thought immune from recessions, is taking a major hit, like every other aspect of the economy. The misfortunes of
wealthy Southern California enclaves (aka Limoland) provide another context for how the recession affects operators nationwide. When Beverly Hills retailers discount their wares up to 80%, you know there is serious change in the luxury climate. As an aside, these deep discounts also reveal how dramatically so many goods and services are marked up during boom times. -- M.R.
SEDANS: There's a new luxury sedan being offered to chauffeured transportation companies. Towne Auto Group is now offering the all-new 2009
Hyundai Genesis to its Limousine/Livery customers. The Genesis can be had with a 290-hp 3.8-liter V6, or a 375-hp (using premium fuel) 4.6-liter V8. Both engines send power to the rear
wheels through a six-speed automatic transmission that features manual sequential shift capability. Luxurious leather seats, automatic dual-zone climate control and wood trim are just some of the appointments this car offers that are typically only found in vehicles costing much more, according to Towne Livery. To find out more details
contact Commercial Sales Manager David Bastian Jr.
BUYING & SELLING: East Coast Transportation of North Florida just bought Executive Transportation & Tours, LLC of Jacksonville,
a competitor that brought in $1.5 million in 2008 revenue. LCT has been hearing about and covering M&A transactions lately (including Sterling Rose Limousine in Temecula, Calif., buying other operations). Charles Tenney & Associates has been staying busy putting M&A deals together around the country, according to Tenney. As revenue drops dramatically and debts increase, operators generally have to make such deals to avoid going out of business. And sometimes they're done working 24-7 and appreciate the opportunity to become part of a competitor's organization. We expect to hear more stories like this one throughout the year. -- J.L.
LEGAL NEWS: Chauffeurs have filed a federal class action lawsuit in Las Vegas against their employer, Whittlesea -- Bell Transportation, the fifth largest chauffeured transportation company. The
lawsuit seeks back wages for Bell Trans chauffeurs and cites a Labor Department opinion and multiple court cases. The argument is that chauffeurs are entitled to minimum wage and overtime. This is happening two years after voters approved a state constitution amendment to raise wages, and adds to complications of Nevada's minimum wage law. This is a legal battle being fought state by state; a federal court ruling will overshadow state jurisdiction. This is an important case to follow. -- J.L.
BMW GETS INTO THE BIGGER ACT: BMW's 730d model with a wider wheelbase is being pitched as the ideal "luxury chauffeured saloon." This model goes head to head with the Mercedes S550, which along with the E-Class, are the two leading luxury chauffeured sedans in Europe now. Mercedes and BMW have made tremendous strides in the U.S. retail market, with factories in the Sunbelt region churning out multiple models to meet American motorist preferences.
Given that European chauffeured transportation companies are at the cutting edge of greener and leaner luxury service, do the S550 and BMW 730d have the potential to make inroads into the chauffeured sedan market as they have in the luxury motorist retail market? Will the future of sedan-based livery involve a mixed fleet of greener Lincolns, Cadillacs, Mercedes, and BMWs? Will a client who drives a BMW and Mercedes as a personal car want to the chauffeured in a bigger model of the same make? All questions that need to be explored as luxury chauffeured service evolves. -- M.R.
OFFERING DEALS: Best Worldwide Chauffeured Transportation has been promoting a special discount program in an email blast: "Start this New Year out the Best way: Save 20.09% on our professional chauffeured transportation services." This type of discount program is something LCT is hearing about from several operators -- offer discounts or lose the business. This is happening in corporate contracts and retail business. It's better to cut rates than not get the business at all. -- J.L.
VERY PRIVATE: Chauffeured transportation operators have been part of the infrastructure at private airports for years, and it's been a great source of revenue. As air traffic gradually shifts from traditional airports over to private airports, doing business at these airports will become a bit more complicated. As the Transportation Security Agency implements its new
"security directive," there will be more regulations and driver background checks put into place. Don't be surprised to hear about
more law enforcement being tied into private airport business, either.
The point is: private airport business is an important market segment to serve, but it ain't gonna get easier. Operators are building relationships with fixed base operators (FBOs) who manage these airports, and with online booking engines that focus on these airports such as
Fortis Riders,
Savoya, and
Celebrity Jet Charter. They're also attending events put on by the
National Business Aviation Association, a major industry association for FBOs and suppliers. It's very good to stay informed, and to anticipate that this trend will require more administrative functions on your end. This is what happened at major airports during the 1970s and 1980s, and private airports will get more scrutiny, regulation, and enforcement as they become a major source of cash, congestion, and safety concerns. -- J.L.
GREEN NEWS: Ford
announced it will be putting out a battery-electric powered version of its Transit Connect commercial vehicle in 2010. Ford is working with Smith Electric Vehicles, a battery electric commercial vehicle upfitter, to bring the vehicle to market in North America. Is this a passenger vehicle or cargo van? Not clear yet.
Click here to see the photo.
In other green news, Peterson Institute for International Economics and the World Resources Institute
have issued a report on the economic impact of green products/services on the economy, including creation of jobs. As the recession unfolds, it appears that a chunk of jobs will go away and another will be created -- green companies being one of them. Perhaps these companies will need transportation services. And will global travel also grow and be an important market segment for chauffeured transportation operators? We shall see. -- J.L.
LIMO IT UP, SURVIVORS: The latest post-Show figures from LCT Magazine reveal more than 2,300 attendees registered for the 2009 International LCT Show held Jan. 26-28 in Las Vegas. 62% pre-registered, while 38% pleasantly surprised us on the spot. Attendees hailed from 47 states and 28 nations.
As a staff, we couldn't be more thrilled with such solid turnout. Yes, it's down compared to last year. But then there has been an economic and political sea change since then, and given a media-fueled Depressionesque debacle, such turnout at our show should be considered phenomenal. The ILCT Show also hosted 94 exhibitors on 100,000 square feet of trade show floor space. What's more, consider that the 2,300 registrants come from an overall smaller pool of industry participants than what existed in March 2008. It goes without saying that there has been at least a nominal contraction in chauffeured transportation. So once LCT Magazine gets the latest nationwide operator total from our Fact Book survey, we'll know the true ratio of success.
Best of All: LCT proves once again that its content and trade show franchise is the dominant, unparalleled player in the chauffeured transportation industry worldwide. For us, that's sure easy to digest. -- M.R.
THAT CHANGING CLIMATE! Why, it's happening every day. While pacing the floor the other night worrying about whether the South Beach Ritz-Carlton will be underwater in 10 years because of global warming, I came across this climate change item that calmed my nerves and gave me hope for a future climate balanced between cool and warm weather. The patriotic dissent of many climatologists can lead to rather intolerant reactions. Chauffeured operators need to be aware of this background drama in evaluating green vehicles, green programs, and green awareness. Cleaning up the air and saving on gasoline through green vehicles is worthwhile and effective. Irrational hysteria only produces green Kool-aid. -- M.R.
STAY TUNED: The annual LCT Fact Book survey will be coming out pretty soon, and we look forward to reading operator statistics and comments. There will be a few changes this year on the questionnaire:
- Not just how many fleet vehicles do you have, but how many are owned, leased, and/or exclusive independent contractor vehicles
- New questions about your green vehicles and practices
- Revised fleet and market segment questions to cover corporate meetings and events, motorcoaches, minibuses, bachelor/bachlorette parties, and limo/party buses
- Not just do you use the Internet for marketing, but more details on how this is done
We also ask if you're doing any commercials on local cable TV channels. You never see chauffeured transportation companies doing TV spots on major networks during prime time, but if you'd like to see an example of a limousine commercial
scroll down to the bottom of this webpage and take a look at how Silk Limousine in Elmira, N.Y., markets its services. -- J.L.
MEETINGS & EVENTS: Major travel industry associations are adopting policies for managing meetings and business trips for corporations that have received emergency government lending. This means that for the $700 billion federal bailout and other funding programs that have happened in recent months, travel service suppliers need to be very careful about honest, clear service delivery. Associations such as Meeting Professionals International, National Business Travel Association, and U.S. Travel Association have joined forces with other organizations representing meetings, events, and incentive travel. The plan was "designed to ensure transparency and accountability and protect the one million American jobs supported by corporate meetings and events."
Click here to read the press release.
This decision reminds me of the Sarbanes-Oxley Act passed by Congress in 2002. That legislative act passed following the Enron scandal and other sad stories. Corporate executives needed to look honest and legal, and started making changes to their travel practices, including cutting rides in stretch limousines. Town Cars and SUVs were okay, and now minibuses and motorcoaches are favored, too. So, if you've got any of these major banks, financial institutions, Big 3 automakers, or other coporations that have received federal funds, as clients, think about adopting the travel community guidelines for corporate meetings and events. -- J.L.
BIG TIME BANKRUPTCIES? As the recession deepens, companies once thought recession-proof, or at least resistant, are facing major financial hurdles. An analysis of debt and cash ratios out today shows the
TOP 15 likely companies to fail in 2009. Chauffeured and charter operators should take note in case these companies are clients or are being viewed as potential clients. In any case, metro regions where these companies are headquartered obviously would be hard hit by economic ripple effects. -- M.R.
GREAT JOBS: Are chauffeurs in New York City really making $75,000 to $125,000 a year,
as one anonymous chauffeur told the New York Times? Former police officers who double as body guards can make this kind of dough, the story says. And these drivers carry guns. Perhaps this reference is to private drivers for wealthy customers or corporate executives. Chauffeurs working full time in New York for operators are going to be making about $60,000 to $80,000 (tips included) in this market, according to the LCT Fact Book survey and what we've been told. For hire operators do have a small number of chauffeurs making even more money, but they usually work long weeks and have a handful of long-term loyal wealthy customers. -- J.L.
BRIGHT SPOT: LCT's newest coverage segment seems to be holding up well, considering the rather calamitous outlook for the economy overall. Motorcoaches provide economies of scale for group ground transportation, and have evolved to the point where they actually exceed the amenities and comforts of airline economy class. Motorcoaches are safe, green, and clean, and frankly, the classiest way for a large group to travel now that airline service has gone the way of un unruly school bus. You can't get more comfortable than in a limousine, luxury sedan, limo bus -- or motorcoach. -- M.R.
PAINFUL CUSTOMER SERVICE LESSON: What is the worst possible fiasco for a limousine company, other than an accident involving one of its livery vehicles? This story should send a shiver through every operator. The New York limousine company humiliated in the article has learned the ferocious consequences of poor, careless customer service, and worse, the failure to adequately remedy it. YOU CAN NOT do this at any time, and especially in a recession. In the age of the Internet, negative media publicity will damage your operations and create lasting impressions. That's why it's also important to attend LCT Shows and seminars; it's like an extra insurance policy against business moronics.
One quibble with the article: When interacting with the media, operators need to stress the importance of using the term CHAUFFEUR, not "limo driver." Big difference. Most reporters don't automatically understand the difference.-- M.R.
LIMO TEST: Mercedes-Benz is testing out a stretched version of its E-Class passenger car. Car analysts believe it's the basis for an upcoming long-wheelbase version. An all-new E-Class was shown off last month at the Detroit Auto Show, and this stretch version test run will become part of upcoming product offerings. The long-wheelbase E-Class will probably have access to upper-end V8 engines and diesel V8s generating up to 354hp, found in the E500. A V6 hybrid powertrain similar to the one featured in the S400 hybrid might also make its way to the market. -- J.L.
CONSUMERS DIG IT: Despite financial worries, U.S. consumers still prefer green solutions, according to a
survey published in Environmental Leader. With green transportation, 19% think it's important, but 22% actually use it. Recycling is very interesting, too - 87% do recycling even though only 39% think it's important. So it's advantageous to market your green fleet offerings and to educate consumers on your company's green practices - recycling, heat/cooling systems, reducing paper consumption, etc. Most interesting point in the survey: 82% of consumers are still buying green products/services today despite the worsening economy. -- J.L.
CARD COMPLIANCE: Kelsey Gerlach, business relationship manager for Century Business Solutions, is concerned that operators become updated on PCI compliance, a policy now adopted by major credit cards for merchant members. The Payment Card Industry (PCI) Data Security Standard has been created to alleviate problems caused by financial fraud and theft.
Click here to access the PCI Reference Guide. There's a lot of information to sift through, but it has been provided by industry members who created the PCI compliance standards, Gerlach said. Century Business Solutions has already taken care of this policy change for customers, but the industry should stay updated on this recent changeover. Online booking providers are also making sure these changes are made to their systems. -- J.L.
NOTHING'S EASY: As revenue cash flows in the chauffeured transportation industry have dropped off dramatically since November/December, managing operations efficiently has become a top priority. This may mean rapid downsizing in fleet, staff, and other operating expenses. It can also mean renegotiating corporate contracts and working with staff to cut costs.
Tom Mazza, president of Tom Mazza Consulting, gave this example in his February newsletter of how an operator dealt with a 20% rate reduction requirement from a corporate client:
"My advice to my (operator) client, in this instance, was to agree to the discount. We presented the following proposal back to the (corporate) client which was accepted:
- Conversion to on-line booking with agreement to pay $5 per reservation for phone reservations after 90 days.
- Net 15 days on all invoices with penalty after 30 days. All payments submitted electronically.
- Agreement from client to take 'any vehicle available' other than stretch when necessary.
- Re-evaluation of pricing in 12 months."
Management met with chauffeurs and explained the situation, and chauffeurs agreed to a reduction of $5 per trip. Renegotiating with clients and chauffeurs didn't create a perfect solution, but accepting reduced rates and lowering operating costs on this account was much better than losing all this revenue, Mazza says. The staff was satisfied with how it was all handled: "The chauffeurs and the office staff were tremendous. Full disclosure from management made them feel respected and they responded in kind." -- J.L.
INDUSTRY DEBATE: We at LCT have been getting an earful for years about fleet sizes, and how so-and-so exaggerates, how fleet sizes don't matter, why do we focus so much on the number of vehicles, etc. Well, the skeptics do have a point.
So LCT would like to put forth a more valid and worthy measuring stick: Profit per vehicle. The true indicator of success in the chauffeured transportation industry is not HOW MANY vehicles an operator runs, but HOW MUCH each vehicle generates in profit as an independent unit. An operator with, say, 4 vehicles that each generate a 25-35% profit margin is more successful than the operator with 20 vehicles who has some generating double digits, others single digits, some flat, others negative or just parked on the lot.
The question then becomes: Would 9,000 plus operators be willing to disclose profit margins on each of their vehicles via a certified audit, and a "Top 100" list evolve out of that? Somehow, we think this is as likely as the federal government junking the IRS tax code in favor of a flat-tax postcard 1040.
So we're back to counting chauffeured cars. That's why LCT is left to focus on fleet sizes. -- M.R.
SUSTAINABILITY BALANCE: Please click on this map, and see if you can find the global warming. Maybe all those carbon offsets have worked already? Most of the nation will freeze tonight. Bet those folks in Kentucky who've been without power for most of the week would love to overnight in a greenhouse. Even us LCTers in humble Southern California will be dipping down to 54 degrees -- the warmest spot on the U.S. 48 tonight.
This colder than usual winter makes one want to warm up the SUV for 10 mintues, drive out to a log cabin in the snowy countryside, turn on some kerosene lamps, ignite the fireplace, and smoke a cigar with the brandy. I wonder if all the carbon could be credited toward the stimulus package. The more carbon we emit, the more green jobs we need to offset it. -- M.R.
ILCT SHOW: Jim Luff shares fond memories from the 2009 International LCT Show. Exhausting, but well worth it.
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LIMOS GOOD, NOT BAD: Yet another politician has been heavily criticized for taking limo rides. Former senator Tom Daschle was supposed to be the new secretary of health, and played a major role in Obama's campaign.
He's been accused of failing to pay more than $100,000 in taxes for a donated limousine. The pressure was so intensive that he stepped back and turned down the offer. How many times have you read news stories like this one, where limo rides are considered an obvious source of payoffs and corruption. (Newspaper editors are winking at readers when the word "limousine" is mentioned prominently.) This makes me wonder: is there anything the National Limousine Association can do to refute such criticism? Could there be a new program offering reduced fare rides to well known political leaders in our nation's capital? A "clean up" program demonstrating how limousine rides with NLA members are safe, legal, legitimate, and luxurious? Just a thought... -- J.L.
TOTAL TRANSPORTATION: The wave of the future: luxury ground transportation. This means high-level customer service rides in motorcoaches, mini buses, shuttles, limousines, SUVs, vans, and sedans. Chauffeured transportation operators are going this route, which inspired the new Limousine, Charter & Tour magazine name. Read all about the
rebranding decision. It's also a strategic decision for bus operators. For example, New York-based
USCoachways is now offering limousines as part of its transportation services. Where is this all going? Operators are now focused on creating luxury ground transportation companies, expanding their focus from one vehicle category to total transportation customer service options. This means marketing more to meeting planners and corporate travel managers, tour operators, destination management companies, sports and entertainment, and inbound international travelers. -- J.L.
Just as you can count on an International LCT Show to feature the latest limousines and boozy networking, the post-Show fallout always brings on the nasty e-mail, the snarky phone call, the bad-mouthing about an operator. . . .
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HELMETED LIVERY: A limousine for the extreme sporting clientele? Operators are constantly being told to not just provide a service, but an experience as well. These racing limos fit the bill. Although the web site Extremelimos.com is taken, the concept has potential. Thrill-seeker limos could be a welcome escape from recessionary stress. -- M.R.
STRETCHING IT: British public officials in Birmingham and towns across the country
are not happy with the increase in stretch limousines, which are usually built by U.S. limo manufacturers and imported. A traffic commissioner will be meeting with the UK limousine trade association and local authorities from across the country to discuss safety issues. Chauffeured transportation was provided for years through luxury sedans, which can weave through the tight streets and not cause as many logistical problems as stretch limos. But young customers have loved the stretches. It will be interesting to see what happens.
In other global news,
Australian operators are feeling the recessionary pinch as business drops 30%-40%, much like what the U.S. industry is experiencing. -- J.L.