Virginia Operator And Carey End Franchise Venture

Posted on August 3, 2011
Virginia motorcoach and limousine operator Stephen W. Story has developed a strong record of service, safety, and transportation diversity.

Virginia motorcoach and limousine operator Stephen W. Story has developed a strong record of service, safety, and transportation diversity.

Virginia motorcoach and limousine operator Stephen W. Story has developed a strong record of service, safety, and transportation diversity.

Virginia motorcoach and limousine operator Stephen W. Story has developed a strong record of service, safety, and transportation diversity.

RICHMOND, Va. — A 10-year franchise agreement between Carey International and Carey Transportation based in Richmond, Va., will expire Sept. 1 after the companies determined their business models are not as compatible as before.

Carey Transportation, a luxury chauffeured vehicle service, and James River Bus Lines, a charter and tour company, are run by operator and CEO Stephen Story. The chauffeured operation will officially be renamed James River Transportation as of Sept. 1.

Diverging strategies

The decision to discontinue the franchise was a mutual one and an amicable parting of ways, Story told LCT on Wednesday. During the decade-long franchise, it became apparent to both companies that their business models were evolving in different directions, he said.

“Carey always has been a high-volume, high-quality service based on airport transfers,” Story said. “It is primarily a Town Car and sedan type of arrangement. We diversified many years ago, and part of that was including vehicles other than [sedans] and motorcoaches.”

James River’s Carey franchise spanned the most populated region of Virginia outside of the Washington, D.C. area. That service region includes the capital city of Richmond and eastward across the state’s tidal and coastal plains that encompass the cities of Williamsburg, Newport News, Hampton, Norfolk, Portsmouth, Chesapeake, and Virginia Beach.

During the last decade, James River Transportation’s business model broadened into more diverse levels of service, fleet vehicles, and pricing tiers for all types of clients. Those clients now include universities and college transit services, airport service contracts, meeting and events services, contract transportation management, and daily commuter service for private company employees, in addition to its traditional niches of charters, tours, airport transfers, and weddings. One of the company’s largest clients is Capital One which contracts with James River for multiple daily round trips to transport employees along Interstate 95 between work centers in Richmond and McLean, Va., to the north.

Washington, D.C.-based Carey International will not renew its franchise with any other operators in the area but instead rely on selected affiliates, Story said. Generally, when a major chauffeured transportation network separates from a franchisee, the circumstances tend to be less than amiable, resulting in the network no longer doing business with the former franchisee, Story said. But James River’s separation differs from the norm, and while it may not be used as an affiliate, Story anticipates that Carey will tap James River Bus Lines for meetings, conventions, and special events related transportation, he said. [Story also mentioned that Carey’s CEO, Gary Kessler, is originally from the Richmond area].

Flexible approach
One unique and noteworthy addition in the last few years has been James River’s shuttle service at the Norfolk International Airport which includes six Ford Flex station wagons that are priced $50 per hour, well below the standard rate for a Lincoln Town Car Executive L. The service has seen a solid success in recent years, bringing an estimated $850,000 in annual revenue. Story now makes the Flex vehicles available for other point-to-point service and as-directed (A/D) runs. So an arriving client who reserves a Flex to go from the airport to a hotel can now reserve a Flex as well to go to meetings, corporate locations, and/or a restaurant for dinner, Story said. Unlike a Lincoln Town Car, the second row of seats in a Flex consist of two reclining, individual bucket seats that provide about an inch less legroom than a Town Car but plenty of headroom.

Story likes to describe the Ford Flex service as “business class,” reflecting a price, comfort and service level between first class (Town Car) and coach class (a taxicab). “The Ford Flex is the only vehicle we found that has decent second row leg room that is a non-modified vehicle,” Story said. “Even SUVs and Toyota Camrys are not that great for legroom [compared to an L]. “[The Flex] is not stylish, it’s boxy, but the interior is very nice.”

Reverse river

Story’s company has followed an unconventional course in the transportation world; it started out as a charter and tour company 83 years ago that grew into luxury chauffeured transportation, instead of the other way around. The more typical industry path for an operator is to start with sedan service and grow through the ranks of larger luxury vehicles and mini-buses to motorcoaches. James River Bus Lines bought VIP Celebrity Limousines Inc. in 2001 from an owner who wanted to retire, and soon thereafter secured a 10-year franchise with Carey and renamed the company Carey Transportation. At the time, there was conservative growth in the charter and tour sector, and since James River was farming out luxury limousine service, it made sense to acquire a chauffeured transportation operation, Story said.

As of this week, James River Bus Lines and James River Transportation operate a combined fleet of 88 vehicles, split about evenly between motorcoaches and chauffeured vehicles. The company has 140 employees across both divisions and earns annual revenues of about $10 million. It has vehicles based in Richmond, Williamsburg, and Norfolk.

Awards gallery
The company has implemented award-winning safety and driver training systems that include a driver training simulator. A “corporate trainer” position was developed that provides sales training for travel consultants, customer service skills, problem solving exercises and team building workshops. The organization was a founding member of the first motorcoach 20 Group in 1999 and later was a founding member of the first limo 20 Group that incorporated complete financial benchmarking. James River / Carey Transportation has received awards from the transportation industry including the1999 Vision Award, 2009 Vision Award, 2011 Innovative Operator Award, 2007 Operator of the Year Finalist, 2008 Operator of the Year Finalist, Top 50 Motorcoach Operator 2002- 2011, and the U.S. Department of Defense highest safety rating.

James River is working on a new URL website address to reflect its name change. Both companies can continue to be reached via www.onetransportationsolution.com.

— Martin Romjue, LCT editor

Related Topics: bus market, business deals, business expansion, Carey International, Carey Transportation, charter and tour, Virginia operators

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