The quarter-over-quarter rebound extends to all sizes of coaches, an ABA report says.
What does a man who has been responsible for the sale, delivery, or distribution of more than 2,500 limousines do when he becomes restless for new challenges and opportunities? In the case of Matthew Baines, 38, former executive vice president of Moloney Coachbuilders in Chicago, you form a company organized to address the specific needs of the limousine user of the 1990’s and beyond. Together with luxury automotive retailer Paul Tamraz, Baines refocused a near-decade of knowledge and experience in the long wheelbase automobile industry and formed Limousine Werks of Barrington, IL.
Limousine Werks designs a complete line of Cadillac, Lincoln, and Mercedes Benz limousines, and is also working to develop a network of stocking dealers who are dedicated to providing a complete range of customer services. Baines has designed a marketing program based on a growing number of dealerships trained to both sell and service limousines, as well as provide necessary financing to further assist limousine operators nationwide.
In Orlando, FL, at one of the manufacturing facilities for Limousine Werks vehicles, experienced coachbuilding specialists Scott Fewell and Mike Elliott supervise operations, working closely with Baines to engineer and build the vehicles.
One of the initial objectives at Limousine Werks has been to develop an affordable, but well-built, limousine specifically for the livery industry “A reasonable purchase price is one of the most important things to a lot of people,” according to Matthew Baines, “and we wanted to offer a car that livery operators could purchase without costly accessories, but which are prewired for such items as moon-roofs, lighted vanity mirrors, and VCRs if an operator wants to add them later.
“We also feel that the livery industry is moving toward longer cars with more legroom,” says Baines who feels that conversions under fifty inches are becoming obsolete. With this in mind, Limousine Werks is currently marketing Cadillac and Lincoln limousines in a spacious fifty-four inch stretch-length. “Most of the fifty-four inch cars in the past have not been affordable,” according to Baines, “but our basic model has the legroom of a long stretch-limousine without having some of the optional equipment that makes most fifty-four inch conversions too expensive for livery use. Someone who buys one of our cars will have the base foundation of the best car in the industry.”
Standard equipment on a Limousine Werks limousine includes either a side or center console, color television with remote control, overhead control console, beverage decanters, four passenger reading lights, Vogue premium tires, and a power divider window. “If someone wants to add a VCR, all they have to do is get one and plug it in,” continues Baines. “Of course we also build completely equipped cars too. We recently completed a $65,000 Lincoln limousine with everything on it, as well as two $135,000 Mercedes Benz limousines, but those vehicles were for private individuals. We are more concerned with building livery vehicles which account for sixty to seventy percent of our business.”
Another objective at Limousine Werks is to design limousine interiors in which the .controls for lighting and other accessories are easily operated by customers. “When passengers get in a limousine on a rental basis,” says Baines, “you have to explain where everything is and how it all works. That is why we put in an overhead control panel. It makes all of the controls very simple. You can even change television channels from the overhead control panel.”
Although Baines feels that Lincoln gained considerable momentum in the limousine industry during the past two years, he expects to see a stronger showing by Cadillac with the introduction of a five liter engine in ’86. “They really want to be in the limousine business,” he says, “They have just offered GMAC financing for limousines. I think that’s fabulous because it will give other lenders confidence in the limousine industry. They have also decided to continue building the rear wheel drive Fleetwood Brougham which provides much more interior room than the downsized model.”
One of the most important goals at Limousine Werks has been to establish a network of distributors trained to provide customer support with product selection, financing, and service. “To be successful in the coachbuilding business,” Baines explains, “you have to get limousines to dealers in local markets. There is no other efficient way to market vehicles on a national basis.” One Limousine Werks stocking dealer is Mitchell Cadillac in Huntington Station, NY. “A successful luxury automobile retailer is more than likely already in a promising limousine market,” says Robert Mitchell, owner of Mitchell Cadillac. Mitchell has been in the retail automotive business for forty-three years, is the immediate past-president of the Cadillac National Dealer Council, and is a member of Cadillac’s Dealer Marketing Committee. “Mitchell Cadillac has taken the most logical step to satisfy the limousine users that are already at or near our doorstep,” he continues. Nick Provenzo, general manager of Heritage Cadillac in Lombard, IL, agrees. “Limousine Werks vehicles are a natural extension of our nationwide fleet and leasing operations. What was yesterday’s luxury for a few is now the fastest growing category in the transportation service industry. Heritage intends to be in the forefront of the growing limousine industry,” Provenzo says.
Limousine Werks is currently selecting aggressive Cadillac and Lincoln dealers who have a good service reputation. As president and chief operating officer, Baines devotes most of his time to building the company’s sales and distribution program while three regional managers are training dealers how to sell and service limousines. “We don’t simply drop our cars off in the showroom and then leave,” says Baines. “When someone becomes a Limousine Werks dealer, we show them how to prep the cars, how to display them, and how to advertise them. Someone from our sales staff will go to the dealer’s marketing meeting and give a full presentation on the limousine industry, including ways to help a buyer finance a limousine.”
Financing or leasing assistance could prove to be one of the most inviting services of a Limousine Werks dealer. Most automobile dealerships work with local banks to locate financing but, considering the hesitancy of many banks to finance limousines, the training given to a Limousine Werks dealer includes a strategy to help bankers look at a limousine loan as more than just an automobile loan. “You have to look at a limousine loan as both an automobile loan and a business loan,” says Baines. “The decision to loan is based on an individual’s past financial performance as well as a projection of what they expect to earn with the vehicle. Bankers are finding that this is a profitable business and that they are making good money on limousine loans.”
Baines stresses that these are not “mom and pop” financial organizations. One loan provider for Limousine Werks, Life Consumer of America, is a wholly owned subsidiary of Life Savings of America and manages over $400 million in assets. At Life Consumer’s Melrose Park, IL loan office, vice president David Chen speaks highly of the lending trail he and his company have already blazed. “Financial institutions that overlook limousine financing opportunities are not taking full advantage of all of the available lending market, especially during these times of increased financial competition. When compared to financing, say, aircraft or speed and leisure boats, the profitable financing of limousines is a much easier and less time consuming proposition. During my ten years of experience, I have never had a limousine loan go bad.”
“What we have done,” says Baines “is work with banks who understand limousine financing.” Limousine Werks has established several sources of financing for stocking dealers which can finance or lease on a national basis. In some cases, these institutions can also be used as references by a Limousine Werks dealer in arranging financing through a local lender. “The goal is to make additional financing available by educating lenders about the limousine industry,” says Baines.
Limousine repair is another important aspect of a Limousine Werks dealership. According to Scott Fewell, director of production at the Florida facility, Limousine Werks has gone to great lengths to establish its service program. “We believe very strongly that training the service technicians of our dealerships will be a great benefit to our customers, as well as to other limousine owners. The dealer will send one of their service technicians to our plant for a three day training program. They will be able to watch the entire coachbuilding process and will learn how to service everything including the wiring, driveshaft, and suspension. These technicians will be given a manual that includes wiring schematics, information on how to repair our paint and trim, and instructions on how to order any parts they may need from us.”
Armed with this training background, a mechanic will be able to perform most repair services on Limousine Werks vehicles, as well as on other makes of limousine. “Limousines from many of the major manufacturers are pretty much alike in their wiring and stretching and their two-piece driveshafts,” according to Baines. “You can sell a lot of cars through the service department,” he continues, “because when someone has gotten their service from us, and they are ready to have a new car, they are going to buy a Limousine Werks product. I think that is how we are going to grow. I know that many limousine operators would rather buy direct from the coachbuilders, but we think that if a Limousine Werks dealer can assist with financing or leasing, and also provide service, buyers will prefer going to a dealer.”
For ’86, Limousine Werks is planning a completely new interior featuring dual side consoles and a full-size rear-facing bench seat so that the vehicle will accommodate six passengers. The consoles will be lockable for occasions when the vehicle is to be used as a people-mover. “The dual side console will be in full production by mid-’86,” says Baines, “because it gives a livery service more flexibility. We are making better use of space in the interior by mounting consoles in the side panels and building compartments for glasses and napkins under the seats. As the years go on, we may not have the big-frame car to work with anymore and we’ll have to be more creative with the use of interior space.”
Baines is optimistic about the future of the livery industry. He feels that even though the industry has experienced a boom in recent years, it will continue to grow and provide opportunities for individuals wanting to start their own business. “You could start in this business for $20,000 and be making money the next day,” he says. “Five or six years ago,” he continues, “you could pull into O’Hare Airport and find maybe three limousines. Today there are about two hundred out there. Nine years ago when I started in this business the only people we sold to were celebrities and entertainers. Today it is very fashionable for almost anyone to use a limousine for a wedding or some other occasion. I think that will continue and I also think there will be more corporate use of limousines to carry executives. The limousine business is just getting started and we think we have the right vehicles, with the right features, at the right price.”
The quarter-over-quarter rebound extends to all sizes of coaches, an ABA report says.
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