That burning question is front and center at the upcoming LCT Technology Summit.
Jack Schwartz entered the limousine business in a manner far different than most limousine manufacturers. The president of Gaines Service Leasing Corporation and Dillinger/Gaines, both based in Brooklyn, New York, built his initial reputation on his commitment to providing service in the leasing and sale of limousines, as well as his commitment to the industry itself long before he even considered building his own limousines.
Having successfully made the move into manufacturing four years ago, Schwartz is now involved in just about all of the important aspects of supplying a limousine service — a business whose interests Schwartz has spent almost 20 years serving. To him, it is more than just the industry in which he has made his money, it is the object of both his loyalty and his dreams. And it is from this perspective that Gaines has grown into a company that delivers a complete set of services, including leasing, financing, insurance, sales and manufacturing.
“Up until four years ago, I used to buy my cars from various stretch manufacturers. All my lessees, whenever they had a problem with the cars, would say to me, 'Jack, we don't care who made the car, we got it from you and we're holding Gaines responsible," said Schwartz, speaking of the clays when he headed only Gaines Service Leasing Corporation, the parent company of Dillinger/Gaines. "I would make good to my lessees but half the time I couldn't get any satisfaction from the manufacturers.
"I'd even lecture to the manufacturers' workers but the quality was still insufficient for the New York market. If you can build a car tough enough for the New York market, you can build a car as strong as a tank.
"So, I figured that if I'm going to be held responsible for every car I buy from a manufacturer, I may as well build it myself."
But manufacturing is still just a portion of what Schwartz believes Gaines has to offer. Besides the previously mentioned services, Schwartz explained there's also an intangible benefit the company holds for limousine services that revolves around his personal commitment to the industry as a whole. He professes to be a man who cares. He wants to see others succeed in the commercial livery business (to which "99 percent" of his business is devoted) and enthusiastically offers advice, expertise and insights from his experience to newcomers and veterans alike.
"We service an industry," said Schwartz. "I don't just build a car. I'm there to service the industry from every aspect manufacturing, leasing, financing, insurance, and any consultation I can give personally."
Schwartz chose to specialize in the field of limousines in 1964. By that time, he had become a specialist in automobile leasing and had purchased Gaines, which was originally founded in 1929 as a new car dealership.
"I saw a need in this industry for a complete service package that would provide leasing, insurance, and financing, as well as creating a secondary and tertiary market for limousines.
"Gaines was really the only one who even thought of specializing in the leasing of limousines," said Schwartz. "Limousines were something everybody wanted to stay away from. It was felt that they were high mileage cars, on the road 20 hours per day, and ultimately had no residual value. Many were frightened of them because they weren't something you could just look up in the Blue Book or a price book and find the value of the car.
"They felt that to dispose of the vehicle was a difficult problem," said Schwartz. "It’s not like selling a standard Chevrolet or a standard Cadillac. Lack of knowledge created fear. Fear created lack of interest.”
Lack of interest reduced the amount of people who even wanted to get involved.
"So, what we did was create for the first time a package for the leasing of used limousines, which then opened up a secondary and even tertiary market. That made it possible for many people who could not afford to go into the limousine business to start their own business with very little capital," explained Schwartz.
"We put people into business to whom nobody would give credit because their background in borrowing money was weak. With many of these people, we gambled. We said, 'Look, instead of giving you a new car, we'll give you the opportunity to get into the limousine business with a used limousine.'
"By creating this used car market, we created a way to sell the cars we had to take in as trade-ins. In other words, people would say they wanted to get a new limousine, but how could they get rid of their old limousine. In creating the secondary market, I could sell new cars to people who needed new cars every year for their corporate accounts and then, with the secondary market, I could sell used limousines to the funeral market or to people who couldn't afford to buy new cars but still needed to update their fleet."
When Gaines takes in a used car, Schwartz said, it is taken to the Dillinger/Gaines factory and overhauled, from engine to ashtrays. In addition, Schwartz explained that his leases have no mileage restriction.
With this program, Schwartz said Gaines has expanded its market far beyond the New York area, where the company originated. "Our market is all over the country. We're so well known today that our market has broadened out to even little towns in the Midwest where there might be a funeral company that needs to update their limousines or a little limousine company that caters to people on the outskirts of a big city.
"Our market, for both new and used limousines, stretches from California to Florida, and also to South America, Israel, Saudi Arabia and other parts of the world."
By creating a market for used limousines, along with the various service packages Gaines provides and the quality of the cars it manufactures, Schwartz said the company is easily able to place the limousines rolling out of its Dillinger/Gaines factory with limousine services. The Dillinger/Gaines manufacturing facility is situated on seven acres in West Islip, New York, and employs 70 people.
"I do not need any outside source to eliminate my inventory," said Schwartz. "Our leasing entity will immediately guarantee that every car we manufacture will either be sold or leased through our company."
He pointed out that Gaines Service Leasing Corporation also leases Cadillac limousines produced by General Motors.
Much of Dillinger/Gaines’ success with its venture into manufacturing is a result of the work of John Staluppi, who oversees the production arm of Dillinger/Gaines. "He's an engineering genius," said Schwartz. "And with my knowledge of the complaints that were necessary to overcome, we put our minds together to design a car that was truly built for New York. It had to hold up and give the type of service and residual value that was needed in this industry.
"It must be remembered that we are involved in a situation where we are not only the manufacturer, we are also the leasing company, in most cases, so the title to the car remains in our name," said Schwartz. "If there's a lawsuit, they're going to sue me, so I must build a car where my liability is protected I have to build a car that holds up like Fort Knox."
Safety and strength is built into the car in a number of ways, with careful attention paid to the aesthetics of the interior and exterior of the cars, Schwartz said.
The Dillinger/Gaines product line consists of three basic models, utilizing a variety of automobile makes for the base car. There is the Gran Touring Limousine, which is a 45-inch stretch using either a Cadillac, a Lincoln Town Car or an Oldsmobile 98 Brougham. There is also the six-door Gran Touring Limousine, which is a 45-inch stretch utilizing a Cadillac or a Lincoln. In addition, there is the 34-inch stretch Corporate Formal Limousine, utilizing a Cadillac or a Lincoln. All of the limousines come with a multitude of options, such as hidden electric wet bar, electric hideaway safe and rear rheostat lighting.
In order to prepare itself for further downsizing of luxury cars, Dillinger/Gaines recently introduced a stretched Oldsmobile Ciera. That limousine is called Le Club.
"This year has been our Deco look," Schwartz said, commenting on recent innovations the company has made to the interior of the limousines. "We feel Deco styling is back in this country. So, our bars have been given a Deco look. The edges are rounded and they are made with a Formica that is color-coordinated with the interior of the car."
Schwartz believes the first step in building a quality limousine is in the hiring and training of personnel. "First of all, you have to have a man who has respect for what his job is. This is something we try to instill in all of our people," he said. "Also, we can't just take someone who works in a body shop and say, 'Come work for me.' We must take that man and train him to do the work the way we want him to do it."
A number of improvements in Dillinger/Gaines limousines originated with suggestions from clients "We are so close to our customers that they can say, 'Jack, I found this while driving and I think it can be improved.' Immediately, I'll contact John Staluppi at the factory and say, 'Look into this. Maybe, we can improve it.' If it's justified, the improvement is placed into production immediately," Schwartz said.
"Longevity is the only thing that keeps me going and that is built on respect and quality. This is why I get so deeply involved with the industry in every aspect.
"In my business or any business, a man's reputation is his product. The product is only the reflection of the individual who runs the company. If people can't say that I make a great product, then all I'm doing is wasting time because my business is never going to grow. It's not even going to be here 10 years from now."
In regards to being involved with the industry, Schwartz said, "Whatever experience or facilities we have have always been offered to various associations that have been formed within the industry, to small companies and large companies who come to us for our expertise," said Schwartz. "The front door to my office is always available to a fellow who's just starting out with one car or to the fellow who may have 100 cars and a problem.
"We have always encouraged people to start their own business and helped people who were weak in credit to establish credit. Some of these people today have anywhere from five to 100 vehicles leased from us. They are not only well rated in the limousine field but also in the financial field.
"We've afforded them this opportunity. This has been the American Dream for them, to own their own business. Still, if I think a man is not qualified to go into business, or if he wants more cars than I think he should have, I will talk him out of it," said Schwartz.
"It's gratifying, when someone does succeed, to have the person say, 'Jack, you helped me and I won't forget.’"
The company Schwartz heads has indeed played an important role in the New York market, but the last several years have seen its role expand dramatically into that of a nationwide supplier to limousine services. From manufacturing to leasing to just some experienced advice, Gaines has delivered. Because of that, Gaines appears to have genuinely grown into its new company motto, "We service an industry."
That burning question is front and center at the upcoming LCT Technology Summit.
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