Regional Associations Make Headway Toward State Regulation

Posted on September 1, 1991 by Scott Fletcher, LCT Editor/Publisher

“You need to call your customers when you don’t need to call your customers.” – Old sales adage

Jay Allen of Carey Limousine in Dallas has watched the economic ups and downs of the livery industry since 1966 when he started working for the family company which operated and distributed limousines and other commercial vehicles. Having experienced a decline in corporate business over the past year, Allen is now cautiously optimistic about prospects for the remainder of the year.

“I think we’ve hit bottom and are starting to improve,” he says. “We have seen some stirring among corporate customers who we haven’t heard from in awhile. They seem to be scheduling business meetings again.”

Indicators Suggest Increase in Volume

Allen is poised to take advantage of growth opportunities. He has not gone out and added vehicles or personnel yet, but he has begun preliminary planning for increased volume this fall. And there are many signs that livery industry volume will increase in the second half of ’91.

A variety of indicators show that the economy has, in fact, bottomed out, and is now in a period of gradual recovery. Assuming the economy is moving upward again, business transportation figures to keep pace. This is welcome news after a year of declining hourly rates and sluggish industry activity.

Livery operators are nearly unanimous in telling us that business is improving. Our outlook is for most segments of the livery industry to return to pre-August ’90 levels. Rates for stretch limousines should return to at least $50 per hour.

On the coachbuilder side, we expect new limousine sales to increase as much as 10 percent in the ’92 model year. We also expect livery operators to continue adding sedans, vans, and buses to their fleets.

Coachbuilders Expect Increasing Sales

On a recent trip through Ft. Smith, AR and Springfield MO, I found several coachbuilders preparing to increase their limousine production in the ’92 model year. One builder remarked that the market for new limousines will increase this year as leases expire on older vehicles. Another company is completing a new production facility capable of doubling its current vehicle supply. A third coachbuilder expects a growing number of livery operators to replace their pre-1990 Lincolns with current Town Cars in the coming year.

Service Is the Key to Growth

Limousine use quickly doubled in the United States after the last recession ended in 1982. Today, the industry is more prepared for growth than it was then. There is a solid base of livery services – many of whom have polished their skills since entering the business during the last boom. So new business is likely to be absorbed by existing companies and, if today’s level of service is better than it was during the last boom, liveries may well penetrate the transportation marketplace deeper than ever.

This is a time to market aggressively. Consider the example of the highly profitable PepsiCo which makes more daily contacts with customers than any other company in the world. And it is time to put away recessionary thinking and begin raising your company’s goals and standards to the next level. Some may debate whether our nation is truly in a period of recovery, but we suggest that you not wait for proof…Make it a reality in your operation.


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