Overview   Dallas Business Journal 2008 Business Travel Executive: June 2005   Business Travel Executive: June 2004   Business Travel Executive: December 2003   Dallas Business Journal: September, 1997

Getting Into Gear

        But the meeting and events market is shifting gears too, with at least some of the impetus coming from corporations that are bringing meeting expenses under the corporate travel umbrella. As in transient, there’s been increased requests for sedans and a growing need for data. What the planners want, says Murphy, is a one-stop shop for their transportation needs and detailed billing. It’s the same at Boston Coach and Empire.

         “Meetings are increasing,” confirms Todd Stephens, senior vice president at Boston Coach. “We’ve identified that as an area we’d like to focus on, to ensure we meet the growing and changing needs of our customers.”Thus, Boston Coach now can track a customer’s spend by account, which facilitates tallying meeting spend. The company’s new GroundControl suite of online tools provides access to a number of standard reports: total spend, total fare breakdown, spending by airport, spending by service area, top passengers and reservation channel usage. It also allows travel managers to develop customized reports for specialized needs.

        These corporate customers “want to be able to track their spend by meeting rather than lumping it into transient travel,” says Empire’s Lockett. For Lockett, one change in the past year for meetings/ events transportation has been more demand for specific meeting/events billing.

        Past experience in the meetings market isn’t necessarily being repeated this year, however. Transportation companies are having to adapt to the new ways in which companies are organizing meetings, Capers says. “Instead of mega-meetings, corporations are opting for smaller, regional events. The companies are attempting to lower overall costs through room sharing, and using more mini-buses and vans than individual sedan arrival pick-ups and departures, as well as motorcoaches for group moves.”

        Shorter routes are also playing a role in cost-cutting campaigns. Capers says many clients are choosing hotels near airports versus downtown or suburban ones as a way to save money.

Security

Whether a customer is traveling as a transient or sitting in a van on the way to a group meeting, providing personal service remains the catch-phrase for the ground transportation industry.

        Some customers are taking that to new levels. At Wynne, Capers says, some clients are requiring that drivers exercise more than simple, safe driving techniques and a polite demeanor. They want to know the driver is well-trained and can bring a measure of safety and security. Some companies, he continues, will only accept drivers trained in evasive driving in addition to standard defensive driving techniques.

        “After 9/11, our services are being viewed not as an higher-priced alternative to taxies or black car services,” he says, “but rather as a means of extending an additional layer of ‘safety and/or security’ to the passengers.”

        Armored cars were added to Empire International’s fleet in November 2001, when memories of 9/11 were still frighteningly fresh. Security drivers are specially trained, licensed to carry a weapon and pre-screen their client’s routes. In addition to armor, the cars they drive have composite security glass, self-sealing fuel tanks and enhanced suspension systems to take care of all the added weight and still deliver a smooth ride.

        Wynne’s concierge service also will escort the traveler through the airport, from gate to gate and beyond the security entrance.

        Increased security measures at many U.S. airports often mean that drivers meeting arriving passengers no longer have the option of waiting at curbside. And passengers no longer can simply assume their transportation will be waiting for them.

        “For corporate VIPs who are traveling, it’s next to impossible for a service such as ours to wait outside an airport terminal,” Murphy says. “In order to speed things along, we use greeters to meet clients outside of the security area and escort them to the car.”

        At some airports, Carey has had success getting its drivers cleared to gain access to the gate, a move he’d like to see other airports allow.

        The greeter is something customers expect, Murphy says. “Not only are our customer expecting it, but we have to provide it given security access at the airports.”

Electronic Amenities

Other amenities ground transportation companies are testing — and implementing in some instances — range from radio service and navigation tools to high-speed Internet access in the vehicle.

        DVD-based navigation is being incorporated into vehicles at Boston Coach. Though it’s a tool for the driver, says Stephens, passengers find it handy as well for finding a restaurant, hotel or some other destination. His company is going beyond simply adding amenities to its existing fleet. New Cadillac DeVilles are being added to the Boston Coach fleet; they’ll be outfitted with the OnStar in-car assistance service. More than 2,000 test rides were completed prior to making the “go” decision.

        XM Radio, a nationwide, satellite-radio network, is being added to the Carey fleet. “We put the actual tuner and controls in the back of the right, front seat, facing the client,” Murphy says. Customers have liked the service because they know the network’s scores of stations don’t vary across the nation.

        Six of Carey’s markets also tested Wi-Fi, wireless high-speed Internet access. Essentially, the vehicle becomes a “hot spot” that emits the wireless signal for a computer’s wireless access card to latch onto. “We have had customers, once they learned which car it was in, request that chauffeur to drive them,” Murphy says. The company may consider adding Wi-Fi to additional vehicles in 2005.

        But not everyone is convinced that customers really want wireless Internet access in a car.

        Empire’s Lockett says passengers are in the vehicle for too short a time. “We did a survey and Wi-Fi didn’t make the survey,” he says. “People were in the car for 20 to 30 miles, or an hour at most. We beta-tested it and nobody cared.” For Lockett, the number one amenity remains the driver.

        Ask any of these limousine company professionals and they’ll tell you: market research and competition are behind a lot of these changes. All three factors are playing roles in how limousine companies are changing, says Wynne’s Capers: “However, the underlying factor is 9/11. Our business is not about vehicle types or choices; it’s about safety and service.”

Rates Are Flat; Costs Aren’t

Of course, there are always costs to outfitting a fleet with new services, training drivers and buying fuel.

        At Carey, pricing has been fairly steady over the past year, Murphy says.”I know much of the industry has been suffering gasoline prices and some are instituting fuel surcharges. Some have built that into their rates,” he says. By mid-May, Carey had no fuel surcharge but the subject was under evaluation.

        Prices are generally trending up, says Capers; “The days of a base rate plus gratuity and other charges are going away.” Customers are responding to price increases by asking for flat, all-inclusive rates in order to avoid being quoted base rates and then having “statement shock with all the hidden/not-mentioned add-on charges.” Some are arguing that the chauffeur’s gratuity should be earned, for example, and not an automatic addition to the bill.

        Fuel costs increased 60 percent in the first four months of this year, says Lockett. “We have not done anything to pass those costs along at this time,” he adds. Nor is it on Empire’s agenda: “Our actual average cost per drive is 2 percent less than last year.”

        Boston Coach has not had that flexibility. It’s had a 4 percent fuel surcharge in place since April 2003, Stephens says. “Fuel is our largest unpredictable cost,” he says. His company has been at work on rooting out costs it can control using IBM’s Focus software. “It allows us to organize our rides to be most efficient,” he says.

        Regardless of what’s changed in the past year and what changes may be in store, these limousine experts agreed that service remains paramount. “We are only as good as our chauffeurs are,” Capers says. Their professionalism, manners, grooming, knowledge and devotion to safety all help his company provide better service.

        “Everything we do, our strategy, is customer-driven,” says Boston Coach’s Stephens. “We’ve heard from our customers. We know these things are important to them.”

        Yet, Lockett adds, Empire’s customers will continue to be the drivers for new services. “I don’t see the pendulum changing,” he says. “Procurement will drive the market.”

        Industry consolidation will be the next big change catalyst, says Murphy. Not so long ago, a large corporation might have retained several ground transportation companies to provide service. But increased pressure to control costs will force a narrowing of corporations’ ground transportation provider lists to just two to three preferred vendors, and offer increased volume to the limousine companies that make the cut.

        With more volume, Murphy predicts, discounts will become a negotiable item.

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