Chauffeurs Opening Doors to a New Market
Like many other Southern Californians, businessman Murray Lugash finds it draining to spend hours behind the wheel, stuck in traffic. But when he needs a break from freeway madness, Lugash turns to an alternative few people consider: He hires someone to drive him around town in his own car.
These days in Southern California, personal drivers aren’t just for Hollywood deal makers, celebrities and the most prominent corporate and government officials. A sprinkling of small chauffeur-service operators are trying to expand the market by pursuing a somewhat less elite clientele.
Among the main targets are well-to-do but lower-profile businesspeople such as Lugash, chairman of Maxon Lift Corp., a family-owned truck equipment business in Santa Fe Springs. The chauffeur firms also are taking aim at time-squeezed professionals, affluent senior citizens and even middle-class consumers who want someone else to do the driving when, say, they go out drinking.
“We almost become the designated driver for them,” said Dennis G. Carlson, owner of WeDriveU Inc., a San Mateo, Calif.-based chauffeur firm that expanded into Southern California last year.
Some of the wealthier people now being chauffeured in their own cars once routinely rode in stretch limousines, particularly when they entertained clients. They eventually drifted away from limos because of the high costs and a growing distaste for 1980s-style ostentatiousness.
Riding in a limo can be “a spectacle,” Lugash said on a recent day when he was being chauffeured in his black Mercedes. “I don’t need that.”
What’s more, security-conscious executives say they feel safer riding with a driver in something less conspicuous than the fancy cars provided by limousine services. “One of the beauties of this is the anonymity,” said a Los Angeles mortgage banker who, for security and privacy reasons, asked not to be identified.
A Less Expensive Way to Go Than Limos
With charges running from $12 to $35 an hour, personal drivers normally cost no more than half of what limo services charge for a vehicle with a chauffeur. But because the personal-driver services generally impose a two- or three-hour minimum, they compete against taxis on the basis of image, comfort and convenience rather than price.
Often the call for these services comes from executives who, like Lugash, want to get work done or relax while they commute. In other cases, the customers are people who own cars but can’t drive temporarily because of health problems or driver’s license suspensions. “I’ve driven a Hyundai, Rolls-Royces and everything in between,” said Russell Hatfield, owner of Chauffeurs for Hire in Palm Springs.
The emerging customers for this luxury service typically can’t afford or don’t want to pay for their own full-time or part-time drivers the way some of the very rich traditionally have.
The same is true for corporate clients. To attract business, firms such as WeDriveU and Private Chauffeurs International, another one of the chief competitors in the Los Angeles area, market themselves essentially as a specialized type of temporary-help agency. The two firms provide drivers to companies that want to have, for example, a board member or an important out-of-town client ferried to a meeting in a company car.
Another selling point, particularly for executives: “If we take you to a business luncheon, you can tell one of our chauffeurs to go get the car washed. We’re basically an extension of their personal assistant, whereas the limo driver would just sit there, because he’s just the limo driver,” said Gregory A. Fibble, owner of Private Chauffeurs.
Personal driver services remain little more than a mom-and-pop industry locally, and no one knows how much revenue it generates. It consists of a handful of small firms and independent contractors who specialize in the business, along with limousine services and individuals who do it as a sideline.
The chauffeur-service business “is in its infancy. Almost no one really knows about this,” Fibble said.
Fibble, who opened his firm in 1989 after moving to Los Angeles from New York, said persuading people to hire someone to drive their own car remains a tough sell, but has gotten somewhat easier over the years. When he launched Private Chauffeurs, Fibble said, “the mentality out here was, ‘What do you mean you drive my car? Nobody touches my car.’ ”
“It took us a good eight years to really carve out a niche,” he added.
Both Fibble and WeDriveU’s Carlson are confident, however, that other cities are ready for chauffeur services, and both plan to expand their firms into new markets. Fibble noted that chauffeur services long have operated in New York; the tradition dates to the horse-and-buggy days. In recent years, chauffeur firms also have operated in such places as Las Vegas and Phoenix.
The drivers themselves mostly work part time or as independent contractors, with the pay starting at about $10 an hour. Those who leave to work as full-time chauffeurs for companies or wealthy individuals can earn from $25,000 to more than $50,000 a year.
Drivers say one advantage of this line of work, contrasted with driving a limo, is that the clients tend to be businesslike and not the type who want a chauffeur to take them to parties lasting past 3 a.m. The customers “have all been really nice,” said Michael Carlson, a deputy with the Santa Barbara County Sheriff’s Department and part-time chauffeur for WeDriveU. (He’s no relation to WeDriveU owner Dennis Carlson.)
“There’s never been a case where, ‘You’re just the peon driver,’ ” he said.
At the same time, drivers are expected to maintain a professional distance from the people they are driving. “When I’m driving, I don’t expect them to include me in their conversation, because I’m there to provide a service. Whatever they’re doing isn’t my business,” Michael Carlson said.
When customers need only one-way transportation, they pay for the driver to take a taxi, train or even plane to return home.
Critics Worry About Lack of Regulation
Unlike limo services or taxi agencies, personal driver firms aren’t subject to special state or local regulation. While that might cut their operating costs, it also means that the chauffeur firms themselves are responsible for making sure that their drivers are, among other things, legally licensed, free of drug or alcohol problems and have no recent history of serious crimes.
That lack of regulation concerns officials such as James Okazaki, assistant general manager of the Los Angeles Department of Transportation. “If I was a client, I’d be very concerned about who is driving my car,” he said.
The owners of the chauffeur-service firms reply that they thoroughly check the backgrounds of their drivers. Some say they would reimburse customers for any out-of-pocket expenses from an accident involving their drivers. Still, the auto insurance coverage for the drivers comes from the customers’ own insurance policies.
Those issues notwithstanding, people in related businesses generally agree that a potentially broader market exists for personal drivers.
For instance, Sandra Taylor Agency in West Los Angeles, an employment firm that normally places nannies, housekeepers and chefs, occasionally gets requests from clients looking to hire chauffeurs.
Bob French, the manager, said the agency isn’t set up to lease out chauffeurs on an occasional basis, so he turns down the business. But he added that a firm specializing in chauffeur service should be able to turn a profit.
“There are a lot of elderly people who need rides to the doctor and parents who sometimes need someone to pick up their children,” French said. “I have a feeling that in the long run they can make some money.”
Steven Gross, owner of the Thrifty car rental franchise at Los Angeles International Airport and a regular client of Private Chauffeurs, said middle-class customers who can’t afford limos could be a growing market for personal drivers.
“They’re not going to hop into a cab, because they’re dirty and smelly. They’d rather go in the comfort of their own car,” Gross said.
“The only real trick is getting the word out, because for the most part your customer base is people who are going to use you just a few times a year.”
Fibble concedes that winning over middle-class and upper-middle-class customers remains a challenge--not so much because of the cost, he says, but because of the resistance to the idea of hiring someone to drive your own car. “Most people still don’t get it,” he said.
But not so for enthusiastic customers such as Lugash. When he hires a personal driver to handle the freeway traffic, Lugash said, “I’m not so beat at the end of the day.”
