L&C Interview: Scott Solombrino and Ralph Caruso of Dav-EI

Posted on September 1, 1987 by LCT Staff

David Klein, founder and President of Dav-El Livery, was interviewed by Limousine & Chauffeur in the January/February 1987 issue. Klein discussed his experiences in the limousine business over the past eighteen years, and related his outlook for the industry in coming years.

On July 21, it was announced to the public that Dav-El Livery, one of the world’s largest limousine service networks with nearly one hundred affiliates, has been acquired by Scott Solombrino, owner of Fifth Avenue Limousine in Boston, and Ralph Caruso, a developer in the Boston area. Solombrino started Fifth Avenue Limousine eight years ago while attending college, and has been a Dav-El affiliate for nearly seven years.

Solombrino and Caruso spoke with Limousine & Chauffeur two weeks before their ownership of the company was formally announced.

Limousine & Chauffeur: What has happened at Dav-El Livery over the past six months?

Solombrino: Since January, the company has been sold to Ralph Caruso and myself. David Klein has gone into semi-retirement, but will still serve on the board of directors.

Limousine & Chauffeur: Can you expand on what David Klein is doing now?

Solombrino: David is enjoying his retirement in Lake Placid, NY, where’s he’s had a home for many years... he spends time in Miami... and he spends time in New York. He has just reached the point in his life where he wanted to pursue other interests.

I was affiliated with David through my company in Boston for many years. When he decided to make a change, I was able to sit down, with Ralph Caruso as a working partner, and develop a joint venture. From that point, we have taken over the company and have set all new goals for Dav-El for the next five years.

Limousine & Chauffeur: From the outside it appears as a sudden, unexpected transition. Is that how it really was? {Editor's note: Klein passed away in March 1988.]

Solombrino: I think that the limousine business can be draining when you get to the level that David Klein had reached after fifteen years in the business. We consider ourselves to be the largest limousine company in the country, and it took years of hard work to build the company to that level. I think that David just got tired of the day-to-day worries of operating in New York, Los Angeles, Washington, Chicago, Philadelphia, Boston, Dallas, and all the other cities that we are in.

You can get burned out in an industry. I don’t think money was an issue... I think it was more within himself. So that’s where we picked up.

We’ve been operating the company for the last six months and, basically, not many people knew that the company was going through a transition. Now the time has come to go public with that. We wanted it to be a very smooth transition.

Limousine & Chauffeur: What is your background in the limousine business?

Solombrino: I started in the limousine business eight years ago. I was studying to be an attorney at Suffolk University in Boston, and I ran out of tuition money. As a way to subsidize my income, I bought a 1968 limousine for $600. It was the last $600 I had, basically, before they were going to throw me out of school.

Scott Solombrino began his career as a chauffeur during college.
Scott Solombrino began his career as a chauffeur during college.

I worked the limousine over the summer... doing funerals and weddings I was eventually able to buy a second car, pay my tuition, and graduate with a double degree in government and communications. I was going on to law school but, by that time, I had four or five limousines and was running a limousine service.

I was intrigued with what I was doing, I was making money, and I was enjoying it. From that point, I was able to build Fifth Avenue Limousine into the largest limousine company in New England. I have been a Dav-El affiliate for the past six and a half years, and have been able to learn many of the business practices that David had used over the years to help build the organization. We were always very, very sales oriented and growth oriented, so I always tried new ideas to expand what I was doing in Boston.

I was a consistent business person who wasn’t building a paper trail but was building equity in his company. This showed the bankers I was there for the long term versus the short haul: It was a good solid investment for them to do business with me. We all know it is very difficult to get people in the banking industry to understand exactly what we do.

Limousine & Chauffeur: So you had to learn about business by trial and error?

Solombrino: Absolutely. I had no business background, and I’d never taken any business courses at all.

I often wonder how things would have turned out if I had studied business. I probably wouldn’t be as successful as I am today because they train people not to take risks. I had to learn by trial and error, and that’s how I got where I am.

Limousine & Chauffeur: Did you feel over your head at times?

Solombrino: Absolutely. In the early years, I was definitely over my head. I always figured that the more over my head I was in building my business... the harder I would have to work. I am a workaholic. I would work 20 hours a day consistently and I enjoy my work. I think that if I had a business background, I would be more in tune with working eight hours a day and taking three vacations a year. By not having a formal business background, I became intent on gaining success through hard work and diligence.

Limousine & Chauffeur: Do you perceive of yourself as being over your head now after acquiring Dav-EI?

Solombrino: Absolutely not. I perceive myself as already having gone through the bad years and having built a strong foundation in the business. I have an excellent understanding of the limousine industry, and I’m confident of the success of this program. I don’t feel over my head.

Limousine & Chauffeur: You did assume some pretty heavy liabilities didn’t you?

Solombrino: It depends on what you consider heavy. I look at it in terms of duplication. I think that our efforts can be duplicated anywhere because we know how to operate successfully.

We also have David Klein on our board of directors. He will be available to give me good business advice along the way.

Limousine & Chauffeur: Now you are the manager of people who are doing what you used to do. That’s a somewhat different line of work isn’t it?

Solombrino: I think it’s the same exact line of work that I’ve always done... but on a larger scale. Like I said, I just have to duplicate my efforts. It just involves more people.

There are some different concerns now because I have to be concerned with more markets. We’re obviously concerned with the twelve largest markets first. We have to watch the trends in each of those markets to understand the needs of our clients. We have hired some very key personnel to help us manage these key markets. I think that that is important.

Limousine & Chauffeur: Will you and Ralph both be based in New York?

Solombrino: We’ll be all over the country because the company is so large that we don’t want to spend all of our time in one city. We both have companies in Boston. Ralph is in the development and construction business. He became a client of mine, and we became involved in some construction and development projects.

When the opportunity to buy Dav-El came along, we felt that two heads were better than one because we can cover twice as much territory. We were both solid business people and we both understood the basic necessities of running a quality operation whether it involved construction or limousines.

We were basically in the same types of industries because Ralph was dealing with hundreds of pieces of equipment like I was... but it was just a different type of equipment. Backhoes and bulldozers charge $50 an hour, just as limousines charge $50 an hour. We thought we had a very good match, psychologically, to do business together.

Caruso: I have always admired the limousine business. Scott is my neighbor and, seeing him with a new limousine, I asked what his new venture was. He said he was looking at Dav-EI, and that sort of took us on a roll.

I was due for a change. I’ve owned different businesses, and I’ve always liked the limousine business, and I’ve wanted to be involved with somebody who really knew the business... which Scott does. He is an expert.

Solombrino: One thing that we’ve done in the past six months was open our own leasing company. We can lease our own vehicles all over the country. We felt there was a tremendous need for that type of service within our organization. We’ll buy our own vehicles and lease them to ourselves.

Limousine & Chauffeur: Will you lease to non-affiliates?

Solombrino: As of today, I wouldn’t want to commit to anything. Right now we will lease to people within our own organization. There could come a time when we would lease to everybody, but we don’t want to be competing with Dillinger/Gaines, or Executive, or anybody of that nature in the leasing business. We just want to take care of our own people and be able to offer them good programs on all types of services that people in our industry need. We want to give them the best possible deal so that they don’t have to go to outsiders.

Limousine & Chauffeur: When you acquired Dav-El, what were some of the initial things that you thought needed to be done?

Solombrino: We are tightening up our internal infrastructure. We would like to see ourselves become more actively involved in certain markets. We would like to expand the company-owned services versus affiliated ones.

Limousine & Chauffeur: Are you looking at new markets, or are you trying to expand in the 12 major ones you mentioned?

Solombrino: Both new markets and established ones. Our attitude is that the more companies we own ourselves... the fewer headaches we will have. At the same time, we want to provide an opportunity for quality operators to work within our system. We know that the system is going to grow 20 to 25 percent a year. That’s the way it is.

Limousine & Chauffeur: Is that what you’ve experienced in the past?

Solombrino: Yes. After our first six months, the report shows that the company was up 20 to 22 percent. In Boston we grew at 100 percent a year. Later, it went down to 50 percent a year which is still phenomenal. There’s no reason that can’t be done everywhere in the country as long as there isn’t a major depression in America.

If you can provide a quality service, you should be able to provide it everywhere across the country. Our new slogan in our national advertising programs is Clean Cars On Time. That is the credo that we want to convey to our clients.

We completed our own survey at the National Traffic and Passenger Conference and the two things that clients responded to most is that they wanted cars that were on time, and cars that were clean. Those were the two most important factors out of a list of twenty. We want to guarantee that we provide this, consistently, across the country. That should separate us clearly from other companies in the industry now.

Limousine & Chauffeur: Will company growth be in stretch business or in sedan business?

Solombrino: That depends on the market. In a market like New York, I would have to admit that the sedan market is expanding tremendously. In places like Los Angeles, the growth could be different. We are doing marketing studies that will give us a better understanding of industry growth patterns in the country over the next two or three years.

It seems to me that the business community is looking for a low-profile form of chauffeured transportation. That is one reason the sedan business is definitely growing. I think that trend will continue for a while. The stretch limousine business doesn’t seem to be going up or down right now. Hopefully, we’ll see a return to the big limousine because that’s the way we all have made our living. If we all wanted to be in the sedan business... we would’ve bought taxi companies.

Limousine & Chauffeur: Ralph, does the recent growth rate of the limousine business surprise you?

Caruso: Well, the construction business in New England has also been phenomenal, but the limousine business has shown tremendous growth all over the country. People are getting adjusted to the fact that you need a limousine or a Town Car to get from point A to point B. I think we are going to continue seeing dramatic growth as long as there isn’t a big shakeup in the economy.

Limousine & Chauffeur: Have you retained key people in your major markets?

Solombrino: Jerri Heslov is still the General Manager of Dav-El in Los Angeles. Joe Lazarus is still the General Manager in New York. Jon Goldberg is still our General Manager in Washington, D C. Nothing has changed dramatically.

I have worked with many of these people for years as a Dav-El affiliate, and I knew that we would not need to make major changes. We’re basically just adding some new people.

Limousine & Chauffeur: Has the transition been fairly smooth?

Solombrino: The transition was smooth primarily because I knew the company and the company knew me. It wasn’t as if an outsider had come in and taken over the company. I was able to avoid some of the things that people normally go through in a transition. I knew the management, the structure, and the financial end.

There were some initial operational problems. I have a tendency to run my companies like UPS would run theirs... very strict and disciplined. I am a quality and service oriented person. Dav-El is very quality-oriented too, but I think I have always taken things to much more of an extreme.

Limousine & Chauffeur: What operational changes have you made?

Solombrino: We’re cautious in the types of vehicles we buy, and who we buy them from, and what we pay for them. Our vendor relationships are much tighter. We changed many vendors so we would get the most for our dollars.

We looked at our operation to see if there were people we didn’t need in certain areas. We have also looked at centralization. One thing that will happen in the next year is total centralization of our organization. Everything will be operated from our national headquarters in New York City and that will have a tremendous outcome on the bottom line.

Limousine & Chauffeur: What are some of your other plans?

Solombrino: We’re looking toward Europe. It’s an area where Dav-El has always been, but we have not been as well-positioned as our biggest competitor over the years. We want to rebuild our European structure and take more control of our domestic structures. Then there will be no question as to who is at the top of the pile.

Limousine & Chauffeur: Are you looking for an exclusive relationship with a coachbuilder?

Solombrino: No, I would say we could have a preferential relationship with a coachbuilder, but I don’t believe that we should do anything that is exclusive. We are looking to have a coachbuilder of preference at this point in time. There are not many limousine companies who buy as many cars as we do per year.

Limousine & Chauffeur: What else are you working on?

Solombrino: We are working on our new national sales program, and our new advertising program.

Limousine & Chauffeur: Your slogan, “A clean car on time,” sounds like it’s mainly directed to the business market.

Solombrino: I think it will also apply to the consumer market because, over the years, there have been many limousine operators who have taken the client for granted and who have hurt the reputation of the industry. They send a car that’s part-clean and a half-hour late. We’re perfectionists at what we do, and we’re saying that there is a need for such basic things as having a clean car that shows up on time.

Limousine & Chauffeur: Will you use your annual affiliate meeting this September to introduce some of your ideas and programs?

Solombrino: Our meeting will be very important because of the transition that has occurred. I’ve always been very close to many of the people involved with the affiliates, and they all know what’s happening. The meeting will just be more or less the official stamp on all the new programs.

Limousine & Chauffeur: Are you still active in the Boston limousine association?

Solombrino: I just stepped down from my position as executive vice president of the Massachusetts Limousine Owners Association. I opted to sit on the board of directors instead because of my scarce availability of time. I didn’t think it would be fair to remain as an officer when I couldn’t be actively involved. I enjoy sitting on the board there... so I will be actively involved in Boston. Rita Cuker has become president of the association and John Karaian was an excellent president before her.

I was also a founding member of the National Limousine Association but I have since become uninvolved because of the direction that association has taken during the last two years.

Limousine & Chauffeur: What direction is that?

Solombrino: At the time, I didn’t believe that they were working in the best interest of the industry. I think that some people who were involved with the association had other ideas about what needed to be done. I don’t think they were as concerned with industry-related issues as they should have been, and I don’t think they worked as effectively on a national level as they should have.

Limousine & Chauffeur: Are you interested in seeing an effective national association?

Solombrino: Yes. It’s vital. I think the way it should happen is to merge all of the local associations such as the Private Livery Owners association in New York. Merge all of the regional associations that have worked so hard on local levels.

All of the local groups have already done the legwork in their states, and are in a position to lobby on industry-related issues. The NLA tried to encourage individual memberships rather than work with existing associations. I tried to express that while I was there and people just didn’t want to hear it at the time. I am very disappointed with where the NLA is today.

Limousine & Chauffeur: Do you see a problem with regulation in the industry?

Solombrino: I see a problem with regulations in every market and every

“I see a problem with regulations in every market and every area and every state.”

area and every state. I think that legislatures now see the limousine as a new industry from which they can derive income. For years and years, people in other transportation industries have banded together to protect their own piece of the market. In our industry, we’re so separated by day to day business problems that no one has gone to Washington and effectively presented ourselves in a professional manner.

Insurance is another major problem that no one has tackled successfully. We have tried... but we haven’t developed a successful national program. We’re splintered as a group and that’s sad.

Limousine & Chauffeur: Do you think that a national insurance program is feasible?

Solombrino: I think a national insurance program is possible if it is done correctly. The insurance situation varies from state to state, and you would need to work with regional associations to implement a program. It all starts, I think, with the local associations. When you get them together, you can build a national organization.

Limousine & Chauffeur: What’s your personal perception of the quality that’s provided by this industry?

Solombrino: There are a lot of problems that result from non-regulation. I’d like to see the industry cleaned out of people who operate with no insurance, who don’t buy their cars correctly, who use cars that aren’t theirs, who don’t pay their employees according to federal labor codes, and who break all the rules in business that you try to uphold.

Limousine & Chauffeur: Any comment on how this all might happen?

Solombrino: I think that the current people in the NLA should evaluate their problems, and restructure themselves. This industry needs an effective national association. Without an association, we are going to face some difficult regulations, and industry problems are just going to get worse.

People are more interested in pursuing personal careers than trying to solve the industry’s problems.

If I started an association tomorrow, I would call the presidents of all the limousine associations in the country and invite them to get together. Most associations have already worked on all of the issues over the years. It’s time for them to get organized.

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