CHICAGO — Despite the stringent chauffeur and vehicle licensing rules in place in the Windy City, legally run Chicagoland limousine operations face a serious threat from a tech pirate: Uber, the on-demand limo smartphone application operating outside of city and state regulations. The difference between Uber and most other illegal operators is that it’s backed by a lot of money and influential people.
(L to R) ILA Board of Directors at the ILA’s BusCon 2012 meeting: Carolyn Carter; Mary Paul; Greg Eggan, President; Dave Hanus; Arthur Rento; Jim Miller; Stuart Rothstein, Secretary/Treasurer; Barb Simkus, Executive Director; Tracy Hodge, Vice President; Scott Delheimer.
Gregory Eggan, vice president of Chicago’s OML Worldwide, and president of the Illinois Limousine Association, addressed this issue at the ILA’s general meeting on Sept. 11 during the BusCon 2012 Expo.
“In my opinion, the new way of business [advanced by Uber] is not the problem,” Eggan said to the room of operators. “Smartphone apps are in our future; they will be part of our industry. Problem is [Uber] is operating with no accountability. We’re following the law, Uber is not.”
To operate a chauffeured vehicle in the city of Chicago, an owner needs to get a city license plate for the vehicle after already getting a regular state livery plate. This requires the owner to go through background checks and prove he pays utilities at a registered address in Chicago. Then he must get a chauffeur with a special city chauffeur’s license, known as a hard card, which also requires training, background checks and drug testing, all of which cost money.
Uber, after an initial interview and short orientation, deploys drivers and cars without checking for proper permitting or any verification of vehicle insurance, Eggan said.
Another problem with Uber is that its payment structure skirts regulations placed on the livery and taxicab industries.
Among the problems Uber can cause for operators are:
- Lose chauffeurs to Uber
- Chauffeur could be using company car for Uber job, bringing up liability issues in case of an accident
- Chauffeurs being late or missing company runs because of Uber run
Regulators have noted Uber’s activity and have attempted to shut it down in various cities throughout North America. But, “Uber is a master of putting a spin on things,” Eggan said. “When regulators try to shut them down, they spin the issue and say that traditional companies are afraid of new trends and are old school. This just gets them more fans, more notoriety.”
Uber’s “spin machine,” as Eggan calls it, pushes messages out to all devices on which it is installed, and generates a storm of petitions to regulatory officials and lawmakers to get things overturned.
“Uber is a big issue. We have to be prepared, not have a knee-jerk reaction,” Eggan said. As part of its efforts to battle Uber, the ILA is considering putting an attorney on retainer. It is also in talks with a national association, whose name Eggan was not at liberty to mention, to deal with Uber through a three-pronged approach that would make the playing field “safer for the public, fair and equal for all in ground transportation.”
Here to help
Overall, the Illinois Limousine Association offers members information and education about city ordinances, illegal operators, and business management.
At the BusCon meeting, the ILA brought in Kirsten Zoub, an expert coach on sales and revenue growth, to help members understand how to operate more profitably. She explained that 80% of business will come from 20% of clients, and it’s important to identify that 20% and spend time nurturing them.
Members also heard from Kaye Kharasch, an expert on green certifications, about the myriad little ways they can make their companies more eco-friendly. “Even though it’s hard to get away from the big luxury vehicles, you can still be green in your office,” she said.
The meeting closed with an appearance from NLA board member Jeff Greene, who explained the benefits enjoyed by NLA members, including an NLA app that is in the works.
Name: Illinois Limousine Association I Location: Carol Stream, Ill. I Founded: 1987 I Operator members: 46 I Vendor members: 13 I President: Gregory Eggan, OML Worldwide I Officers: Tracy Hodge, Vice President, Your Private Limousine; Stuart Rothstein, Secretary/Treasurer, Smart Cars Worldwide I Directors: Barb Simkus, Executive Director; Arthur Rento (past President), Pontarelli Companies; Carolyn Carter, Carolyn’s Classic Limousines; Scott Delheimer, Class Act Limousine; Tony Douvlis, Amm’s Limousine Service Inc.; Jim Miller, A-1 Airport Service; Dave Hanus, Reliable Limousine; Mary Paul, Crown Cars and Limousines I Est. operators in Chicagoland area: about 3,000 I Meetings per year: Monthly teleconference with the board, two general meetings (May and Sept.) I Annual dues: $100 to $500 I Supported charities: Jon Simon Scholarship I Website: www.illinoislimousineassociation.com I Contact: (630) 665-9133