Corporate Clients Shape Industry History

Posted on July 1, 1990 by LCT Staff - Also by this author

Corporate limousine use, a fairly recent development in the history of the livery industry, has influenced the design of cars and the services provided by operators. Today, corporations have proven to be a demanding but profitable market for limousine services, and a necessity for any service that operates seven days a week. Recent history shows that limousine services which cater to business needs are affected not only by the needs of their clients, but also by advances in technology and changes in the economy.

Throughout these periods of change, operators have shown themselves to be flexible enough to adapt to new attitudes, resilient enough to bounce back from hard times.

1920s and 1930s

Before corporations began using limousine services in the early ‘40s, wealthy individuals were the primary customers. They enjoyed the luxurious details in the limousine, including drapes, flower vases, and heaters. At that time, the passenger area was warmed by a register in the floor which collected heat from the exhaust system. Cars without heaters carried lap robes to keep the clients warm. Jump seats allowed more passenger seating, while partitions added privacy. Limousines of the ‘20s and ‘30s, were often multi-purpose vehicles.

“In the ‘20s and ‘30s, a limousine was for the personality, the wealthy, the extroverted, and used for sports or entertainment or whatever,” says Robert T. McMahan, former executive vice president of Hess & Eisenhardt in Cincinnati, OH. “The inception of corporate limousine use began in New York with Carey Limousine.”

According to J. Paul Carey, Jr., the company now known as Carey International, Inc. was started by his father and grandfather in 1921 under the name Grand Central Packard Renting Company. “We used to handle luxury private customers. We never got too many corporate customers in those days,” says Carey. “Mostly, they were people who had either given up their chauffeur-driven car or used us as a supplement for their regular drivers. We drove probably the most prestigious families in New York in those days. Corporate customers as we know them didn’t really start riding until just prior to World War II.”

The 1940s

Gas rationing during World War II caused businesses to look into alternative forms of transportation. “Corporate clients began using limousine services because of gas rationing, which took place from 1942 to 1945. Businessmen couldn’t get to places with private cars because there was not enough gas. In many cases, companies gave up their cars,” explains Carey.

Amenities in the hired limousines included AM radios. “There was no FM in those days,” Carey says.

As airplanes became more prevalent, traveling businessmen began to use limousine services more frequently. “Years ago, business travelers would go into the cities by train,” says Carey. “They’d stay in town for a couple of days and take the train out. With airplanes moving people a lot faster, people would come into town in the morning, have their first meeting at 10 a.m., get their business done, and take the plane home at night. They would not stay over, especially people who lived in Boston, Washington D.C., Cleveland, and Detroit. We handled the largest corporate businesses in the country.”

The speed with which airplanes could get a person in and out of a city made it feasible for a corporate clients to do business in one day, but it also meant that punctuality was essential. Consequently, a hired limousine driven by knowledgeable chauffeur made good business sense. “The corporations’ manufacturing plants would be outside of the city in many cases,” says Carey. “Limousines provided the necessary transportation.”

The 1950s

“In the ‘50s, livery services specialized in handling the business traveler,’ says McMahan. “There was a certain amount of prestige associated with the limousine.” This trend took place when businesses, having discovered the usefulness of limousines during World War II, felt the service was worth the cost. Interestingly, at that time corporate clients did not want cars with the phones that were then available.

“Back in the ‘50s we had phones in our cars,” says Carey. “They were not requested often. They were a novelty – reception was not good and the phones were costly. People had no use for them. It had one channel. You pressed the switch to talk and released it to listen.”

By 1953, air conditioning began to appear in cars. “By about 1954 or 1955, in the summertime if we didn’t have an air conditioned car, nobody wanted it, says Carey. “We put the air conditioned cars on right away, because we didn’t have any business without them.”

The 1960s

In the early ‘60s, some companies began to put televisions in their cars. However, many hired limousines had only basic amenities. “Factory limousines were around until 1970,” says McMahan. “They were a conveyance of people, and had no amenities except a rear radio and front air conditioning. They had jump seats which folded down from the side of the car or pulled up from the floor. It was a shorter car, with only 24 to 36 inches of stretch and seated two in the jump seats plus three on the bench seat. A business used a limo which seated one to two people.”

Limousines were not as widely accepted in the ‘60s as they are today. Some corporations looked on them as flashy rather than efficient, and livery services changed their fleets to meet their clients’ needs.

Stephen Spencer of London Towncars in New York began his business in 1959 with a fleet of three English cabs and a Bentley sedan. In March of 1960, he added six limousines to his fleet in order to obtain corporate accounts, but soon after, found his clients wanted “something more substantial [than a London cab], but not a limousine.” He purchased sedans for his fleet; today, 70% of his business comes from corporate clients who request sedans.

The 1970s

“In the ‘70s and early ‘80s, limousines were associated with business from the perspective of a businessman picking up a client from the airport in his limousine,’ says McMahan. “In the early ‘70s, business use of limousines started to grow, partly because of the publicity of limousines used by the government.”

Air conditioning, radios, and permanent rear-facing seats were installed in limousines in the early ‘70s, along with a center console. Televisions were placed in the console, facing the rear seat. Sunroofs and more sophisticated controls over heat, air conditioning, reading lights, and radio followed.

“Probably the biggest change in the limousine industry occurred when the credit began to catch on and the stretch came in and people began to move more quickly,” says Carey. “That affected every aspect of the limousine industry, including the business from corporate clients.”

Cities became more congested and limousines more specialized. “It all started to come together in the middle to late ‘70s, because there was more of a variety of limousines,’ says Carey. “With the traffic problems, the parking situations and the shortage of taxi cabs, it was much easier to get a limousine.”

The 1980s

In the early ‘80s, modern communications technology began to appear in limousines as manufacturers designed new interiors dictated by customer needs. Arrangements especially for the businessman who wanted to travel with a computer and telephone at his immediate disposal were offered by manufacturers at this time, according to McMahan. Cellular phones made their way into cars and became so important to the corporate client that today, operators must provide car phones to ensure business. A 1986 AT&T ad reads “This car just flunked the ultimate limo test.” In the ad, above the caption is a photo of a limousine stopped beside a public pay phone.

Around 1985, fax machines became small enough and affordable enough to be placed in cars; the May/June 1989 issue of Limousine & Chauffeur reported that the number of fax machines in U.S. limousines was 50.

The most recent additions to limousines are portable computers which allow the corporate client to work while traveling. Clients can request transformers to convert DC current to 110 AC, allowing them to plug in their own computers. In addition, chauffeurs have on-board computers which enable them to make clients’ reservations from the car and reduce radio talk.

The Trump Executive Series manufactured by Cadillac and Dillinger/Gaines shows that coach builders are interested in providing for the corporate client. Everything from phone and fax to paper shredder and special safety features is provided in this luxury stretch. Other coachbuilders have created vans and stretches that are ideal as “moving offices.”

In the early ‘80s, corporate businessmen entertained clients in a stretch limousine, but preferred a less ostentatious car for business use. “In the late ‘80s and particularly with the October 1987 stock market falloff, businesses requested smaller cars. The changes began early in ’86 and after ’87 people didn’t want to be associated with an ostentatious car,” say McMahan. “They went to sedans.  Fleets went from factory limousines and stretches to sedans.”

Recent Events

Many companies were adversely affected by the October 1987 stock market crash, and responded by cutting travel costs, which affected livery services. Teddy Wisniewski of Teddy’s Transportation Systems in Norwalk, CT reported that he lost 50 percent of his business after Black Monday. He was able to recover in a few years by increasing his client base and offering service in a wider area.

Many operators are in the process of educating potential corporate clients about the benefits of hiring a limousine service. Executives are beginning to notice that millions of corporate dollars are wasted due t o productivity lost while businessmen are driving. Commuters and those who travel in their work are spending a great deal of time on the road due to heavy traffic; already they seek to increase their productivity while on the road.

A recent L.A. Times article outlined the various amenities now available for private cars: desks, taxes, phones, televisions, and even microwaves and refrigerators. However, highway law enforcement agencies, concerned that drives may be distracted by these gadgets, may outlaw them, opening a niche for limousine services to fill.

Still the Same

Of course, the most significant trend in the history of corporate limousine use is what has not changed: the desire for luxury transportation, on time, in clean cars. “People want good service,” says Carey. “They want to know that their car is going to be there, with an experienced chauffeur. Service is still the name of the game, regardless. A clean car, an efficient chauffeur, that’s all they really want.”

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