2015 was a pivotal year for the limousine industry on many different fronts — especially as operators worldwide organized to counter the growth of transportation network companies (TNCs) that have disrupted traditional ground transportation.
Developments reverberated throughout the industry that forced operators to roll with the punches. Insurance rates went up. Gas prices went down. The travel and leisure industry rebounded to levels not seen since the pre-recession years. Hourly rates remained about the same, and competition hardened. More companies consolidated, bought others, or got sold off. Business travelers gravitated toward apps. And an energetic generation of operators is emerged, armed with the latest technology and a command of digital and social media to build new state-of-the-art operations.
New Sedans Looming, Buses Booming
“Whatever works” seems to be the motto as this year closes out. Since the demise of the workhorse Lincoln Town Car sedan, operators are experimenting with an array of U.S., German, Japanese, and Korean sedans, SUVs, hybrid vehicles, and even the pricey all-electric Tesla. One operator told LCT that his fleet includes the boxy Ford Flex he assigns to haul traveling families, or corporate execs with golf bags.
However, the game could change in 2016 with the debut of the new luxury Cadillac CT6 sedan and Lincoln is reviving its Continental nameplate as its top-of-the-line sedan.
Buses and vans gained a bigger share of the overall fleet market as an increasing number of operators ventured into high-end van service via Sprinters and Transits and took on mid-coaches and motorcoaches. The annual LCT Fact Book and Industry Survey reported operators added more custom limo buses and shuttles, as the stretch limousines yield to cutaway buses and higher-ceilinged vans become the “new stretch limousines.” Spurring the demand for more group transportation are corporate and retail clients ordering wine tours, destination weddings, corporate and campus shuttle services, and special events transportation.
Throughout the year, LCT reported extensively on the limousine industry buying more buses and motorcoaches, as well as the safety issues, federal regulations and new technologies that provide safer vehicles and amenities that improve passenger comfort and entertainment and communication, such as WiFi.
In fact, the 2015 LCT January issue set the tone for the year by calling 2015, “The Year of the Niche.” The issued was devoted to previewing a wide ranging photo gallery of every size and configuration of customized limo buses, motorcoaches and other specialty vehicles.
Social Media
The industry overall ramped up its social media initiatives in 2015, although it has been a bit sluggish to dive into the world of social media as a marketing, communications, networking, feedback and branding tool.
LCT covered social media throughout the year and devoted trade show sessions to the topic along with new technologies and mobile apps. For example, the May issue featured an article, “How To Get More Business With LinkedIn,” that was gleaned from a session at the International Las Vegas Show. An article in the October issue, “How Social Media Can Snag More Paying Customers,” gets right to the ROI operators can expect from implementing Facebook, Linkedin and Twitter campaigns.
Some facts that LCT laid out for making social media strategies a priority:
• Consumers are 71% more likely to make a purchase based on social media referrals.
• Twitter is the No. 1 online channel for influencing purchasing decisions surrounding electronics.
• Facebook is the most effective platform to get consumers talking about products
• 74% of consumers rely on social media networks to guide purchase decisions.
• 15.1 million consumers go to social media channels before making purchase decisions.
Uber Everywhere
As TNCs deepened their operations in cities and airports worldwide, the industry overall was slow to grasp the threat from this loosely-regulated on-demand mobile business. But 2015 was the year the industry began to fight back in earnest by organizing on the local, state and national levels to counter TNCs flouting the rules and regulations that govern the private ground transportation industry. There were some wins, but a lot of losses, too. However, the industry realized in 2015 the battle is long term, and must be fought on numerous fronts including legislative lobbying, consumer and corporate education about public safety, and class-action lawsuits over TNCs drivers being misclassified as independent contractors instead of employees.
The National Limousine Association, celebrating its 30th anniversary in 2015, took up the cause to counter TNCs with a national public relations campaign (Ride Responsibly) that focuses on educating consumers and corporations on the differences between TNCs and more reputable private ground transportation providers. The Taxi Limousine Para-transit Association complemented those efforts with its “Who’s Driving You?” campaign.
Meanwhile, 2015 also saw serious momentum for on-demand mobile applications intended to compete with the TNCs. Startups such as iCars, Deem, Whisk, Blacklane, Limo Anywhere, AsterRide, Limo Alliance, Dash Ride, and other newbies are at various stages of trying to become the limo-industry-worthy “killer app” against Uber.
Millennials
No other population segment has been sliced and diced as much by analysts as the Millennial generation. Operators are trying to cater to them as consumers, employees and corporate clients. LCT not only wrote about the Millennials throughout the year, but held educational sessions and panels while growing the memberships of its Fast40 networking group of operators under the age of 40.
Happy New Year
As we head into 2016 facing what already has become a long election process, TNCs, regulations, environmental concerns, the economy, and other issues will influence the fortunes of the ground transportation industry, depending on which political party prevails. Overall, 2015 was a good year for business, as many operators reported higher revenues not seen since before the 2008-09 recession. Looking back, many of the challenges will intensify in 2016, but the industry appears more united, tech savvy, and prepared for the unknown and the unexpected.
Keywords
business trends gas prices industry trends Millennials new sedans new vehicles Social Media TNCs Uber
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