Fleet Sizes: Who Cares?

Posted on February 4, 2009 by - Also by this author

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. 

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