Operations

Overseas Fleets Forced to Focus on the Practical

Posted on August 1, 2008 by LCT Staff - Also by this author

One often overlooked aspect of the limousine and chauffeured transportation industry is the fleet market in nations beyond the U.S. and Canada. While LCT Magazine devotes considerable time and energy to documenting North American fleet sizes and trends, no organization has yet emerged that consistently tracks and ranks fleet sizes and trends in the U.K., Europe, Asia, and the Middle East.

Our informal conversations with European operators reveal that chauffeured transportation companies in major cities must deal with obstacles alien to most Americans:

1) Ultra high gas prices, now in the stratospheric $8 to $10 per gallon range

2) Narrow, winding streets in historic, quaint neighborhoods, towns, and villages that could barely handle the width and girth of a Hummer or a Lincoln Town Car 

3) High-speed autobahns where vehicles can average speeds upwards of 100 mph for extended periods.

Hence the major market for Mercedes, especially the E and S class models, BMW, Jaguar, and Volkswagen sedans. One advantage with using diesel vehicles is the better average mileage, about 27-30 miles per gallon, which helps offset the higher fuel costs.

There is also a general cultural aversion in Europe to what can be perceived as American excesses: tricked out, superstretch limousines and SUVs that would be both impractical and expensive on European roadways. One exception, however, has been the growing popularity of stretch limousines among British youth, who seem to be embracing the limousine tastes of American high schoolers headed to their proms. The realities of European transportation require more medium-sized, high performance sedans that may be a bit skimpier on leg room but nevertheless provide an efficient, compact form of luxury and most importantly: Speed. Your average Lincoln Town Car in the U.S. will not be barreling toward LAX or JFK airport at 100 mph, for example. But a Mercedes turbo-diesel on the autobahns ringing Frankfurt or Berlin would be a sought-after amenity among corporate clients.

As to actual fleet sizes, the United Kingdom appears to have the most discernible trends and evolved chauffeured transportation industry in Europe. One leading company in the U.K., Tristar Worldwide Chauffeured Services, ranks as one of the largest, with a fleet of 650 vehicles, up from 550 in June 2007, says its president and CEO, Dean De Beer.

De Beer, who is one of the most informed observers of the European chauffeured vehicle market, estimates that average operator fleet sizes fall well below 100 vehicles. “Your average would be less than 100 vehicles in the U.K. and less than 50 average across the board,” De Beer says. In nearby France, considered the second largest chauffeured vehicle market in Europe behind the U.K., only a handful of operators have 100-200 vehicles, with most falling well below that level, De Beer says.

European operators will be facing the same business travel dynamics as American ones as the business travel sector and wider economy either slows down or contracts, De Beer says. “The next year or two will be quite tough,” he says, referring to banks and multi-national corporations slashing travel budgets. Likewise, the strong Euro and weak dollar currencies will discourage many Americans from traveling to Europe and using chauffeured vehicles, he adds. Exceptions include the leading emerging economies, such as China, India, and Dubai, where increased business activity likely will lead to growth in the number of chauffeured vehicle providers and their fleet sizes, De Beer says.

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