Sometimes an old way of operations can be adapted to a new era because it’s simple and easy.
PETALUMA, Calif. — An on-demand TNC-type service called BlinkCar being tested by California operator Gary Buffo could gain wider acceptance among limousine operators if all goes well in coming months.
Buffo and his wife, Jennifer, who own Pure Luxury Transportation in Petaluma, launched BlinkCar the second week of December and issued a first formal press release promoting the venture on Feb. 15.
BlinkCar, a separately branded and coordinated division of Pure Luxury, is the first serious, locally-based industry response to Transportation Network Companies (TNCs), such as Uber. BlinkCar is a fully legal and licensed charter-party carrier by the California Public Utilities Commission, which regulates limousine companies in the state, and to a lesser extent, the newly created category of TNCs.
Higher Service Levels
Unlike TNCs, BlinkCar is run with the same high operational standards of a professional chauffeured transportation company, like Pure Luxury. Those would include driver training and background checks, (W-2) employee pay and benefits, maintenance and cleaning standards, and vehicle and passenger insurance coverage.
“Our ultimate goal is to give it to our industry, our affiliates, and our competitors,” Gary Buffo told LCT. “It’s a volume business. For us to compete with TNCs, we need to offer enough vehicles and drivers on the road. Everyone could market and promote BlinkCar.”
BlinkCar is expanding from its core region around Petaluma to most of Sonoma County this week, which lies north of San Francisco. The service region would span a 45-mile radius around Pure Luxury headquarters about three miles north of downtown Petaluma. The Buffos plan to bring BlinkCar to the tourist- and corporate-visitor heavy winemaking region of Napa Valley in April.
The BlinkCar app can be download to iPhones or Androids from Google Play or App Store. The app is proprietary to Pure Luxury and licensed through a software vendor that Buffo cannot publicly disclose for competitive reasons.
“We are in test mode,” said Buffo, who also serves as President of the National Limousine Association. “Every day, we are trying to work out glitches because it’s an app created from scratch. That’s why we did a soft launch. Until the glitches are worked out, we would not want another company to be upset.” Since the app launched, those glitches have fallen from about 50-60 per day to only a handful.
About 30 of the company’s 185 employees are dedicated to BlinkCar, a 24/7 service, along with about 10-30 vehicles of its 148-vehicle fleet. BlinkCar uses the Lincoln MKZ as its standard economy sedan, the Lincoln MKS for a luxury sedan, and the Lincoln Navigator for the SUV segment. Buffo eventually plans to switch the BlinkCar fleet to more efficient Ford-branded vehicles, such as the Ford Focus Hybrid and the Ford Flex. BlinkCar vehicles are labeled with a “BC” logo and driver number in the upper right corner of the windshield.
“We're in the process of replacing and adding equipment,” Buffo said. “During the next few months we will choose vehicles for that platform. We don’t want to compete with our own customers who use us for as-directed runs.”
So far, BlinkCar has attracted a diverse clientele including business professionals, college students and seniors. Fixed rates are based on per-mile or per-hour structures, depending on what the client chooses. But BlinkCar does not surge its prices at peak times as do TNCs. BlinkCar incorporates real-time GPS, an open API license, and permission to use Google Maps. Pure Luxury also has fleet facilities in Napa and Foster City, enabling it to place and maintain vehicles throughout the wider San Francisco Bay Area.
“On New Year’s Eve, we blasted out that we would not be doing surge pricing,” Buffo said. “It was our best day yet. We had people telling us they wouldn’t even use Uber or a TNC again because of their price gouging. We can raise rates for a season, but it’s the same rate for that season. That has worked out for us.”
The Buffos rely on a mix of traditional, digital and social media advertising and promotions to get the word out on BlinkCar. Those would include ads in the local newspaper, fliers, door-to-door marketing, and Facebook/Twitter pages managed by Pure Luxury’s social media team.
Profit And Loss
The overall cost of a ride ranges from $17 to $30 depending on time and distance. BlinkCar adheres to all federal and state wage and labor standards, paying its drivers like chauffeurs. Because BlinkCar is still in an experimental start-up mode, the service has not yet generated a profit.
“It’s tough to tell at this moment in time,” Buffo said. “Right now we are losing money, no doubt. We’re paying our guys an hourly wage, plus gratuities, from the time they get into the car to the time they get out. We’re getting close to understanding all the algorithms.”
Buffo estimates labor costs at about $100 per driver for an eight-hour shift, plus the per vehicle costs of insurance and fuel. “It’s a volume business and we have to get volume up by putting enough vehicles on the road using affiliates and competitors,” Buffo said. “Then everyone can make a bit of money. I don’t see it being a high profit margin business, not with the way we have to operate. When you operate with employees, everything changes.”
TNCs so far have enjoyed what some would consider unfair advantages over limousine and taxi services because they operate on the independent contractor business model, now the subject of several federal labor lawsuits and investigations. Unions and labor advocates have pointed out that TNC drivers in many respects are supervised and handled as if they are full-time employees. Pending decisions in two California federal court cases could require TNCs to change their labor practices, rendering their business model and discounted pricing unfeasible.
One change in state law that made BlinkCar possible came on Jan. 1, 2014 when the CPUC authorized digital waybills for TCP-licensed charter party carriers. That improved how operators can file and store mandated trip records, since digital waybills are more compatible with app technology. “Once they changed the waybill from paper to digital, then we could use the app technology we have now,” Buffo said.
Buffo sees much potential in BlinkCar spreading to other cities and counties with operators being able to form a real-time affiliate network for on-demand service based on available fleet inventory at any time. BlinkCar also could invariably draw customers who’ve never used chauffeured services before and could be “upsold” into traditional limousine services for reserved trips and special occasions.
“I hope BlinkCar will be for the limousine industry,” he said. “It’s not just being built for me and my company. I hope everyone can use and market it in their areas and look for each other’s vehicles. That’s how it needs to work. We need to stop competing against one another and work with one another.”
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