Operations

Carey Chief Sees Industry Challenges Continuing

Posted on April 1, 2003 by Rebecca Christiansen, LCT staff editor

LAS VEGAS - Limousine opera­tors must keep in mind that daunting national economic and political developments will continue to have a major impact on the industry, Vince Wolfington told delegates in a keynote presentation at the LCT Show.

The chairman/CEO of Carey International also said that limousine operators - and their drivers and other employees - have a role to play in homeland defense: awareness, preparation and vigilance will help keep people traveling, he noted.

Fight Terrorism

"Terrorism is a reality of our business," Wolfington said, "and the best defense is a good offense. The risk needs to be mitigated." Terror is best fought on a grass-roots level, Wolfington advised, telling operators to get drivers and others involved in keeping an eye for potential trouble by using common sense.

Fear, ignorance and surprise drive terrorism, Wolfington said, adding that operators should establish policies similar to fire drills to prepare for it. By organizing preventative action and by establishing and enforcing channels of communication, the threat and its effects on your business can be minimized.

Also, Wolfington suggested humanizing the practices and procedures and to include professionals in the plan.

Airlines' Example

Airlines sell price, which hasn't worked for them, Wolfington said, pointing to the decline in airline travel since 2001. Even in this economic climate, operators must sell service to stay afloat. Customers are accustomed to paying for service and will continue to do so during a recession if service is what they want.

For example, Wolfington said the upscale hotel chain Ritz-Carlton has held its prices, stayed dedicated to service and had solid financial results despite a recent 15% decline in occupancy in the overall hotel industry.

On the other hand, Wolfington noted that the airline industry has suffered its highest loss ever since 2001, even though many carriers slashed their prices to the lowest levels in years to stimulate demand. Therefore, if operators stay true to the history of the limousine business by focusing on service, they will get through these challenging times even if it will be difficult, he said.

Cloudy Forecast

In a recent survey, LCT readers listed rising insurance rates, increasing fuel costs, vehicle safety, chauffeur recruitment and government regulations as the gravest challenges to the limousine industry, Wolfington said.

However, he added to that list economic factors - the state of the stock market, commodity price trends, interest rates, inflation and economic growth — and the political outlook, in particular the situation in Iraq.

"Prepare for the worst," Wolfington said. "As a country, we're economically and politically strong, but anything ahead of us is cloudy, so we have to look to the past." The 1991 Persian Gulf War, for example, sparked a slowdown in travel, a fall in the stock market, a spike in oil prices and an economic recession, all factors Wolfington said were likely to again affect the limousine industry.

 

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