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Scott Solombrino, Dav El CEO and a leader in the NLA and GBTA, says on-demand mobile apps are changing chauffeured service faster than anything he has seen in 35 years in the business.
BOSTON — Ask Scott Solombrino about any industry topic, whether business or political, and you’ll get a thorough and often entertaining answer. There aren’t many simple yes/no responses from someone who will talk about anything.
At the 2012 LCT Leadership Summit in Puerto Rico, for example, the CEO of Dav El Chauffeured Transportation Network held an entire meeting room spellbound and tickled for an hour with off-the-record analytical riffs and wisecracks on politics, as he batted around questions. He can deliver a state-of-the-industry summation almost on command, or at least sans notes and scripts. He speaks, without any awkward pauses, to massive ballrooms of attendees at the annual Global Business Travel Association, for which he serves as President of the Allied Leadership Council. As a longtime National Limousine Association board director and founding member, Solombrino can opine about any topic at hand, and often redirects and steers the discussion at board meetings.
Such talents are only fitting for a limousine industry and business travel leader who chauffeured his first limousine in 1978 while studying government and communications at Suffolk University. Solombrino soon got his big break after he went to New York and made a pitch to David Klein to become the Boston franchisee of Klein’s New York-based “Dav El” limousine company, then the largest limo service in the U.S. He bought the company in 1987, and grew it into one of the leading global chauffeured transportation networks.
His legendary gift of gab is backed up by the substance of a three-decade career touching upon all aspects of business and ground travel. His intense focus and discipline enables him to average 180 days on the business road per year. You could say he’s picked up a few pointers along the way, which he can recall and expound upon in vivid detail.
Solombrino chimed in recently for a roulette wheel of a conversation with LCT, his first extended interview since the Great Recession. He can wax profusely about whichever topical number the question ball lands on. The topics provide an apt summary of the key trends and challenges facing the corporate chauffeured transportation sector:
Uber And On-Demand Mobile Apps
Uber is creating an unprecedented paradigm shift in the chauffeured transportation sector, one that might bring some short-term pain but long-term opportunities, Solombrino says. You cannot change a climate of instant gratification based on informed real-time consumer commerce always available on wireless gadgets, he adds. “I can’t think of any innovation in last 35 years that has shifted the mentality of travel users quicker in ground transportation than Uber.”
While Solombrino believes the core chauffeured clients will stick with traditional reservation based service, younger generations weaned on mobile apps and the Internet will want more flexible on demand service as they get older and move up the corporate ranks, he says. “The high end market will get smaller for chauffeured car while the new younger, high-end [clients] will become more demanding. . . I predict most operators will be offering a similar Uber-like product to end-user customers to meet the public’s demand for ease of use, and the process will improve the overall ground transportation experience.”
The drawback to Uber is the “complete lack of quality control, complete lack of understanding of who is driving the vehicle and what their background and record would be,” he says. He warns there are still many twists to come for Uber, with lawsuits and regulatory inroads brewing that could set new precedents and practices in the mobile app transportation market.
But the concept and usage of mobile on-demand app technology will stay, he emphasizes. “The good news for chauffeured transportation is that many people have upgraded from taxi and are paying a higher price point to use a Sedan Magic or Uber-type product. We’re actually selling up in the marketplace. It’s creating end-user customers because of the ease of how it is booked and transacted.”
On the controversial and growing practice of limousine operators supplying Uber, Solombrino remains neutral: “The financial meltdown proved one thing: You must do what you have to do to generate revenue and make a profit. I have no problem with anyone using fleets for Uber as long as you do it legally and follow the law. Anyone who tries to dictate that to other people doesn’t know what capitalism is about. People have to do what’s best for business. Who am I to say what one operator can do versus another?”
Hand-in-hand with mobile apps comes dynamic pricing. It requires operators who can consistently meet demand levels at peak times, Solombrino says. “The hotel market has had dynamic pricing, so why doesn’t [chauffeured] pricing go up between 5 a.m. to 9 a.m. and 4 p.m. and 8 p.m.? I think it’s a new way to look at the market. We may start to see corporate contracts get written with dynamic pricing, as long as you can guarantee delivery on demand.”
The key questions, he says, include: “We have to rethink how we calculate what we are getting paid here. Will corporate America allow us to do what rental, hotel and airline industries have done for years? Is ground transportation big enough to be able to manage dynamic pricing like the hotel industry? What does the low end look like when it is slow? Are you costing yourself more money than you are making to meet that demand?”