Operators Voice Industry Concerns In Annual LCT Survey

LCT Staff
Posted on June 15, 2015

Facts in a survey need to be backed up with facts on the ground. That’s why we ask limo operators nationwide every year what industry problems and challenges trouble them the most.

This year, we put that question to a random list of more than 30 operators from around the world we’ve met. Below are the survey results and the comments from those who responded in time for publication.

Q: What are the TOP 5 industry- or business-related challenges concerning you?

“There will always be new competitors, higher costs of operation, rising fuel costs, employee issues, irritating government regulations, fees for this and fees for that, but in the end I keep moving forward with a positive attitude for a business I love NO MATTER WHAT. Early on, I started to concern myself with some of the issues below but soon found that I was taking precious time away from what I loved, running my business. No, I am not blind to the fact these issues are alive and well but I choose to not be distracted by them. None of the issues concern me to a point that distracts me from this fabulous industry. I just deal with them when the need arises.”
Val Newton, Regal Limousine Service, Benton, Ky., and Nashville, Tenn., and 2014 LCT Operator of the Year Award winner

• • • • •

“First, we think you can combine two of the top concerns: 1)Transportation regulations and, 2) TNCs, as a single item. Reputable operators are not concerned about the plethora of local, state, and federal regulations – as long as the regulations are uniformly applied to all livery operators, including the TNCs. Collectively, the industry cannot match the hundreds of millions of dollars Uber has raised through public offerings to: a) fight the mounting lawsuits for a variety of offenses by maintaining that Uber is a software application and not a ‘provider of transportation’; and b) lobby practically every state and federal lawmaker to position themselves outside the livery industry and legitimize their services. Anyone who believes that Uber will simply go away is deluding themselves. Our industry must adapt to emerging technology, not run from it. We should all re-read Jack Welch’s famous quote, ‘If the rate of change on the outside (of your business) exceeds the rate of change on the inside (of your business), the end is near.’ Wynne has always been a staunch supporter of safety. As one of the first traditional livery companies to add motorcoaches to our fleet, we embraced the federal safety requirements and extended those requirements to include all of our drivers and chauffeurs.” — Robert Lockett, EVP of corporate development, Wynne Transportation, Dallas, Texas

• • • • •

“Insurance, fuel and government regulations will always be challenges for our industry. The fewer companies offering to insure livery service will increase our costs. With more hybrids and electric vehicles on the road, the price of fuel will increase because of fuel taxes. With the presence of TNCs, the big challenges we will be facing in the next few years are: Finding qualified and customer friendly chauffeurs; government regulations making it difficult to find the right people; and the suggested increase in minimum wage to $15 per hour, which will increase the cost of transportation and make it less competitive with TNCs. In keeping up with the high-tech needs for our industry, TNCs appear to be here and we need to get unified technology to compete with them for the services we provide. We should be standardizing our pricing so providers and affiliates can communicate faster with corporate clients.”
Bonni Fortune, Lucky Limousine & Town Car Service, Portland, Oregon

• • • • •

“Right now the three biggest challenges we face are the rising minimum wage in California, rising fuel prices, and of course on-demand transportation apps. Inflation is always raising operating costs, but with minimum wage going up to $15 so quickly and fuel costs projected to possibly be $5 per gallon by the end of the year, it’s harder to keep up than ever before. The skyrocketing popularity of on-demand transportation apps is not just having an effect on business, but on the perception of our industry by the consumer. Expectations are changing, and we’ve got to keep up.”
Alex Darbahani, KLS Worldwide Chauffeured Services, Los Angeles

• • • • •

“My company is planning to launch its latest version of Vancouver Limousine Service app available for free on the App Store in June 2015. We are learning a lesson from our partners in the U.S., where car sharing apps like Uber and Lyft and Sidecar hurt the taxi and limousine industry. We believe that we can service Vancouver with an app that’s new, cool, and easy to use but follows all the insurance and passenger transportation board requirements. We want to stimulate our local economy and keep the jobs here before letting U.S. companies like Uber, Lyft and Sidecar come and unfairly compete and put our passengers at risk. There will always be passengers who would like to ride in limousines and pay taxi rates, but in a market like Vancouver where the gas price is $1.30/ litre ($5/ga), and you have $10 million insurance policies and an MSRP minimum of $50,000 for fleet veicles, we just can’t ofer $20-$30 rides.
Lorenzo Armani, Absolute Styling Limousine Ltd., Vancouver, BC, Canada

• • • • •

“Quality employees behind the wheel and in the office have been one of our biggest challenges this year as we grow. Operating a premium luxury service, our company must have service-minded employees to go along with it and it’s become ever more difficult for a few reasons. In California, the cost of labor is on the rise through our legislative processes of mandatory sick pay and increased worker compensation rates. Our pricing is constantly pressured by clientele demanding cheaper transfer rates and the eradication of hourly charges. These scenarios make it a difficult situation to find attentive, intelligent, service-minded employees and fit them into the pay scale we allocate for such positions to remain profitable. We’ve chosen to keep our ‘Employees Wanted’ sign posted year-round to help with this matter.” — Matt Strack, Strack Transportation, Costa Mesa, Calif.

• • • • •

“The most pressing concern is chauffeurs/bus drivers. There is a terrible shortage of qualified people. Customers are easier to find than the drivers.” — Paul Rodberg, Reliable Limousine & Bus Service, Silver Spring, Md.

• • • • •

“The biggest challenge for me is to find chauffeurs who want to work and who are experienced. No matter how well you take care of them, it is very hard to find people who want to work full time as a chauffeur. Thanks to Uber, everyone is a driver. I can place an ad asking for specific experience and I have applicants telling me Uber is their experience. I now write in cap letters UBER IS NOT EXPERIENCE. — Mona Marandy, Monalisa Limousine, Los Angeles

• • • • •

“The biggest concerns for our industry here in the United Kingdom are the same issues that both our stateside and our international NLA members are fighting every day. Since the launch of the TNCs here our industry has seen serious disruption across all sectors. The most concerning issue for us here in London is that our current legislation regarding the use of Private Hire Vehicle’s (PHV), such as ours, clearly states that the only vehicles allowed to use a meter to calculate fares are the iconic London Black Taxis, and that it is illegal for any other vehicle to carry a meter if it is used for the carriage of passengers for hire. Yet our licensing authority in London has granted a large TNC an operator’s license on the basis that their app was deemed not to be a meter — although the app calculates fares using a measurement of time and distance in much the same way as a black taxi operates. All PHV operators in London are now patiently awaiting a legal ruling from the High Court on this matter.”— Peter Bailey, Comfort Executive, London

• • • • •

“I think the most pressing issue is technological change. We have seen Uber’s superior customer contact and booking system devastate the sedan side of the market. On the bus side of the business, increased emission, entertainment and safety technologies have diminished the amount of time a bus can remain a “premium” part of our fleet. Google has replaced print as the most effective source for new retail customers. Its opaque proprietary selection process for the order of search results has spawned a bevy of snake-oil salesmen who promise premium placement in return for consulting fees. Also, our office staff must be multi-talented networkers in addition to being hard workers. Our ability to keep up with emerging technologies will determine our future.” — Dan Goff, A Goff Limousine & Bus Co., Charlottesville, Va.

• • • • •

“The biggest challenge we face today is not so much how to compete but rather how to best position our businesses and industry in the mix, and for the future.

Like all of you I’m sure, I get asked several times a day, ‘How is Uber impacting your company?’ So I say, ‘Thank you, Travis’ (Uber CEO Travis Kalanick) for giving me the perfect opportunity to discuss with my customers what value we provide them and asking what can we do to serve them better and earn more of their business. Deeper relationships, local knowledge and great customer service is what drives our customers and their organizations and is exactly what “one and done” services like Uber and Lyft don’t always provide. The very innovation and technology that identified an untapped market and disrupted our industry could potentially catapult it, if we are prepared to band together. Perhaps instead of trying to stop a train in its tracks, we should get on board and recognize and seize every opportunity at this opportune time. Technology is ubiquitous and trends move quickly. Technology may defy us for now but it should not define our industry.”— Gina Walker, North Shore Shuttle-BeDriven, Revere, Mass.

Related Topics: client feedback, LCT Fact Book, legal issues, staying competitive, technology, TNCs

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