SUV Flipper-Floppers -- Part II

Posted on May 7, 2008 by LCT Magazine

DITCHING THE DIVAS OF THE ROAD: We posted a report yesterday describing how many American consumers are getting fed up with their bulky, gas-bloated SUVs and pick-up trucks. This has led to a run on some dealerships where owners are unloading their vehicles, even at a loss. But there may be some silver linings for the chauffeured transportation industry.

If there is a glut of used and unsold SUVs, pick-ups, vans, and larger automobiles, it means operators and coachbuilders likely can get cheaper deals on vehicles. That will lower vehicle payments and overhead.

Just because American families get rid of bigger vehicles does not mean they lose their appetites for them. Switching from an Explorer to a Corolla may save money, but the transition likely is miserable, especially if you've gotten used to all that space. So who else but chauffeured transportation and limousine operators to provide luxury vehicles?

This downward market dynamic actually could yield a marketing opportunity for operators. What family wouldn't enjoy an occasional trip in a comfortable chauffeured sedan or SUV for a special outing, say to dinner and movies, a theme park, a day trip, etc.? It could be advertised as a hassle-free arrangement: no gas, no driving, no cleaning, no parking, no worries.  That way many Americans can still enjoy the comforts and conveniences of SUVs and larger sedans without  having to own, maintain, or fuel one. -- M.R.

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