N.J. Ops Ask Vehicle Commission to Investigate Avis Chauffeur Drive

Posted on October 3, 2007 by LCT Staff - Also by this author - About the author

SHREWSBURY, N.J. — A new service by the Avis Budget Group Inc. offers its customers a chauffeur with a rental car. The New Jersey limousine industry, says Avis gets an unfair competitive advantage by sidestepping regulations that tightly control the limousine industry.

"They're trying to get around all the bureaucratic things necessary to operate a for-profit transportation company," said Gary Kramer, owner of Impress Limousine, a Shrewsbury company that owns five vehicles.

The limousine industry is asking the New Jersey Motor Vehicle Commission to take a closer look at the Avis program to ensure that it complies with state law. But executives involved with the service said the rules aren't that simple because Avis technically is not a limousine company.

The dispute revolves around Avis Chauffeur Drive, a program that Parsippany-based Avis started in June and offers in New Jersey and nine other metropolitan areas.

Avis contracts with WeDriveU, a San Mateo, Calif.-based company that doesn't have its own fleet of vehicles. Instead, WeDriveU provides chauffeurs, who drive customers in the customers' own cars.

In the Avis program, a customer would rent a car from Avis and then pay another $34.50 an hour, for a minimum of three hours, for a WeDriveU chauffeur. It means an executive who lands at Newark Liberty International Airport for a day of meetings in New York doesn't have to worry about hailing cabs, finding parking or footing a huge bill for a town car.

Michael Caron, vice president of product and program development for Avis, said the service is an attempt to separate Avis from other car-rental companies, not unlike adding satellite radio, a global positioning system or EZ Pass to its cars.

"We're continually looking for ways to bring speed and convenience" to customers, Caron said.

However, the limousine industry is crying foul, mainly because Avis and WeDriveU offer the same service as limousine companies but don't face the litany of regulations that people in the industry say are in place to ensure customer safety.

Among them: Limousine companies need to register with the state and are granted specific license plates; they need to carry at least $1.5 million in automobile insurance; and they can only hire drivers who are fingerprinted and pass a criminal background check.

The regulations most clearly come into play after an accident. If a driver for a limousine company gets into an accident, the company would be liable. If a driver for the Avis program gets in an accident, the customer, who provides insurance to rent the car, would be liable, said Barry Lefkowitz, executive director of the Limousine Associations of New Jersey.

"We wanted to make sure it was clear the limousine industry was pro-consumer and very much desirous of separating itself out in regards to safety," Lefkowitz said. "They're trying to call something a service, but it's not legitimate under the laws of New Jersey."

Cathleen Lewis, a spokeswoman for the state Motor Vehicles Commission, said neither Avis nor WeDriveU are registered with the state. Do they need to be? "From our view, the intent of the law is to ensure customers of passenger transportation are as safe and secure as possible," Lewis said. "We'd hope that businesses have that same intent and they wouldn't try to find loopholes in the law."

"If they have indeed found a loophole in the law, that's something the Legislature would address," she said. "Our job is to enforce the laws on the books."

Dennis Carlson, WeDriveU's chief executive officer, said his company keeps safety measures in mind. Its drivers need to pass a drug test and criminal background check, and have a valid driver's license and a clean driving record. It also requires that its drivers take a half-day training class, he said.

WeDriveU insures its drivers against injury by providing workers' compensation. The customer is responsible for automobile insurance, he said.

"It's a private use of a driver," Carlson said. "It's your car. It's your insurance. We're providing a laborer."

It's also a concept that irritates limousine companies. For example, Kramer of Impress Limousine said he spends $30,000 a year to register his five vehicles with the state.

Kramer's company charges $50 an hour, plus gratuity, tolls, and sales tax. If the Avis program takes off, it would put him at a decided disadvantage because the state regulations add to his overhead.

"They're flying in the face of every law that was created for transportation for hire," Kramer

SOURCE: Asbury Park Press

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