Industry Research

LCT's Annual Operator Survey

Posted on May 1, 1989 by LCT Staff - Also by this author

Here are some highlights from LCT's sixth annual operator survey.

  • 60% of limousine operators have been in business for more than three years.
  • Nearly 50% of limousines are less than two years old.
  • One of four limousine operators requires his chauffeur to wear a uniform and a cap.

These are just a few of the results from the sixth annual Limousine & Chauffeur Operators Survey, which was distributed in the November/December 1988 issue of the magazine and during the Limousine & Chauffeur Show in

Baltimore from March 12-15, 1989. On the whole, the survey depicts a healthy, stable, and established industry.

Altogether, 134 companies representing a wide cross section of operators, from California to New York to Florida to Nova Scotia, responded to the questionnaire. In past years, the survey has been divided among East Coast and West Coast operators, but this year the numbers are tallied in aggregate. The data listed in the survey is not meant to depict the entire limousine industry, but is merely a sampling of responding operators. The purpose of the survey is to shed some light and identify trends in the limousine industry. Of the responding firms, 89% listed limousine service as their company’s primary business activity.

Nine of ten respondents listed their title as “owner” of a livery service, with the remainder of respondents listed as either company managers or chauffeurs. The survey shows that owners of limousine services take an active role in the industry with many respondents listing their title as not only owner, but also dispatcher, manager, and chauffeur.

Livery service is now an established industry, beyond its fledgling stage. One indication of this is that 60% of the responding operators have been in business for more than three years, compared to 43% last year in the West and 56% in the East. Moreover, 26% of companies this year are more than six years old. The figures also indicate that there has been a decrease in the number newborn services. In fact, only 40% of livery services are less than two years old, compared to 57% last year on the West coast and 44% on the East coast. This slow-down in the number of newly formed livery services may mean the industry is nearing its capacity, or could forebode a slight slowing of the economy.

Fleet Demographics

The survey depicts an industry that is still extremely active. During the next 12 months, limousine operators answering the survey plan to purchase or lease 385 vehicles — including 214 stretches, 114 sedans, 14 formals and 43 vans or buses. This calculates out to 2.6 vehicles per company — down slightly from last year.

Limousine fleets appear to be aging, albeit gracefully. Still, 48% of vehicles are listed as less than two years old. This is compared to last year’s figures of 60% on the West Coast and 78% on the East Coast. This is a significant drop in the number of new limousines on the road. 44% of vehicles are listed as being between three and five years of age, while 6% are more than five years old.

Operators are also waiting longer to replace their vehicles. According to this year’s survey, 15% of operators replace their limousines within two years, compared to nearly 50% last year. Does this mean operators are maintaining their vehicles better? Or does it mean operators do not have the capital available to rollover their fleets? Nearly three-quarters of the operators indicate they replace their fleet between three and five years. Only 10% wait more than five years.

Another indication that the industry has become more established is the size of fleets has grown to 8.0 vehicles. Last year, West Coast services averaged only 5.7 vehicles while Eastern companies averaged nearly 10 vehicles. The average fleet consists of 3.6 stretches under 70 inches and 2.7 sedans. Fleet makeup is mainly stretches under 70 inches (60%) and sedans (23%); less popular are formals and vans (6% each) and least popular are stretches more than 70 inches (4%). This seems to indicate that operators are scrutinizing purchases of longer vehicles. Some reasons could be insurance rates and possibly the Department of Transportation inquiry into the limousine industry.

Another sign of activity is that the average livery vehicle is used for 10.4 trips per week, compared to 8.2 trips last year. This could indicate that operators are more efficient in their dispatching — utilizing the limousines to carry more passengers and thus increase revenue. However, the average gross income per vehicle per month fell to $3,434 this year compared to $3,716 last year. In another sign of increasing efficiency, the average miles per car per year rose to 38,600 miles — an increase of about 4,000 miles.

More than four times as many operators purchase their vehicles rather than leasing them. However, many of the larger fleets responding to the survey tend to lease their vehicles. On the average, the operators who do not own all their vehicles lease about 66% of their fleet.


Respondents to the survey employ nearly 2,000 chauffeurs. Each company averages 5.4 full-time chauffeurs and 9.4 part-time drivers — for a total of 14.8 chauffeurs. The figures indicate that operators are gradually shifting toward the use of part-time drivers.

Attire for chauffeurs is becoming less formal. Seventy-four% of companies require their chauffeurs to wear a suit, while 26% ask their drivers to wear a uniform. Last year, more than 40% of drivers had to wear uniforms. Meanwhile, 24% wear caps. A handful of chauffeurs are required to wear tuxedos — primarily for weddings.

Two of three livery services mandate their chauffeurs participate in a training program. Meanwhile, 54% of chauffeurs are provided with a written manual — down from last year.

There was little change in the number of firms that include the chauffeur’s gratuity in customer invoices. This year, 63% list this as common practice, while last year 83% of Western services and 58% of Eastern services indicated the client’s bill included a tip. Many respondents say that they sometimes include the tip.

Seventy-nine% of companies allow customers to smoke in their limousines. Many of the operators responded that they have designated non-smoking cars for customers who are sensitive to the smell of cigarette smoke. Three of five operators responding to the survey are headquartered in a state that allows passengers to drink alcoholic beverages inside the limousine.

There has been a steady rise in the hourly rates (based on a three hour minimum) for limousine service. For stretch limousines, the average is $51.60, compared to $48 last year. Since 1985, there has been a 31% increase in hourly rates, an average of 7% annually. Meanwhile, the hourly rate for a sedan rose to $37.77, an increase of about three dollars. The cost of hiring a formal limousine also rose approximately three dollars to $41.18 per hour.

Many operators believe attracting corporate clientele, is one of the important keys to a successful livery service. These customers not only reliably pay their bills, but are also not unruly or rowdy in the limousine. Moreover, these corporate clients are steady business — day in and day out they need limousine service. This is especially important during slow mid-week or seasonal periods. Not every company can survive waiting for springtime to arrive and the onset of high school proms and June weddings.

Many of the operators responding to the survey realize the importance of corporate clients. More than one-third (36%) of business is provided by these customers. Last year, Western companies reported 34% of revenue was produced by corporate riders while Eastern companies revealed a 40% production.

One question asked frequently by operators at the conclusion of the survey is, “How can I attract more corporate clients?” The answer is not a simple one, but providing efficient, reliable service is a step in the right direction.

Another interesting trend is the increase in the amount of computerization being used by limousine services. This year, 31% of operators use computers for billing clients, a gradual increase from previous years. Other computer applications for operators include reservations (21%), trip tickets, (19%), maintenance records (21%), and payroll (24%).

Cellular phones continue to be a money-maker for limousine operators. Nearly two-thirds of the operators replied that the phones produce revenue for the company. Nearly 75% of operators answered that their entire fleet is now equipped with cellular telephones. Operators revealed an average of 68% of their vehicles are equipped with phones compared to 44% last year.

Finally, the survey shows that it’s good to have a friend who runs a limousine service. Nearly 84% of operators responded that they offer a preferred rate for special customers.

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