Limousine Services 2018 Profiler Brought to you by Media Group Online, Inc. Driving Forward Despite Hazards © 2018 Media Group Online, Inc. All rights reserved.

Fewer Operators, More Revenues Although the limousine services industry continues to face many challenges, 2016 gross limo operator industry revenues (the latest data) increased 4% from 2015’s $2.5 billion to 2016’s $2.6 billion. The number of operators (limousine/chauffeured and motorcoach/charter and tours) has decreased significantly (35.1%) from 12,661 during 2015 to 8,212 during 2016. Almost half of operators had increased revenue during 2016, compared to 2015, and the same percent planned to add staff during 2017. One-third increased their rates and 84% kept rates the same during 2016. Even so, 41% say industry conditions are worsening www.mediagrouponlineinc.com

Profitability Advances Fewer respondents reported increased revenues during 2016 than for 2015, 47% compared to 63%; more reported decreased revenues (24% compared to 22%); and more said revenues were flat (29% compared to 16%) compared to 2015. Still, 42% said their profit margins had increased; 35% said profits decreased and 23% said they remained the same. Average net-profit margins were 15.9%, but 44% had profit margins of 15% or less, 50% between 15.1% and 30% and 6% more than 30%. Corporate/business travel clients accounted for more than half of revenues (53%), with 47% from retail/leisure clients. Almost half (49%) of all revenues were airport-related. www.mediagrouponlineinc.com

Back-Office Operations During 2016, the limousine industry bought 6,954 vehicles, an increase of 37.7% from 2015. These included 3,727 sedans/CUVs, 1,200 shuttles/minibuses, 608 large vans, 604 SUVs, 475 limos and 340 motorcoaches. The companies’ Websites were the top source of reservations, at 38%; followed by phone, 35%: referral from a third party, 18%; and social media, 12%. More than one-third (35%) of respondents said they were considering the purchase of a limousine company and 23% said they were planning to sell their company within the next three years. www.mediagrouponlineinc.com

The Technology Factor Most of the operators surveyed for the 2017 LCT Fact Book (85%) regularly use smartphones for chauffer communications, 59% use tablets for customer name greetings and 53% use GPS fleet-tracking software. In addition, 40% regularly use affiliate/app reservation network platforms and 35% have a mobile booking app, making them more competitive with TNCs. Carmakers are racing toward developing completely self-driving cars, which would be bad for chauffeurs, but good for limo services since labor is the biggest expense. Toyota aims to have one by summer 2020; Chevrolet is planning a self-driving fleet by 2019. www.mediagrouponlineinc.com

The TNC Hazard Although competition from TNCs, or transportation network companies, such as Uber and Lyft, were limousine operators’ biggest business concern during 2016, it declined to #5 in 2017’s list of concerns. Automakers believe that personal car ownership will decrease significantly during the coming decades. This will benefit TNCs, but may also benefit limo firms, which, if outfitted with the right technology, can offer a competitive premium ride sharing service. To compete with TNCs, Addison Lee, the world’s biggest chauffeured transportation company, has launched a global digital service to allow customers to book trips in more than 100 cities worldwide. www.mediagrouponlineinc.com

Advertising Strategies Although younger adults watch less TV than older adults, it could prove to be a valuable ad medium during wedding- and prom-booking seasons to generate referrals from younger adults’ parents and grandparents to their children and grandchildren. Emphasize the safety of driving with you, highlighting the benefits of driver training, background checks, experience, etc. compared to TNC drivers. Highlight the benefits of a shared minibus service, such as lower per-passenger costs, to frequently visited places, such as airports, cruise ship ports, shopping areas and casinos www.mediagrouponlineinc.com

New Media Strategies Develop a mobile app if you have a large company, so customers can book rides/services easily. For smaller companies, make sure your Website is mobile-friendly and has a booking feature. Because video is the top content format on Websites and social media, record videos of each of your drivers, introducing himself/herself, years of experience, safety record and specialty services, such as restaurant and nightlife bookings. www.mediagrouponlineinc.com

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