Avis confirmed in March that it has suspended WeDriveU operations in Miami-Dade County, according to a news report posted on www.LCTMag.com, a chauffered transportation industry Web site published by Bobit Business Media.
Miami-Dade County had become a national focal point for the Avis chauffeured drive model, which, according to the report, does not adhere to the rules and regulations required of chauffeured transportation operators of luxury vehicles.
Because Avis is not classified as a limousine operator, it is not required to license its chauffeurs or meet the stricter insurance, training, certifications and safety requirements of the limousine and chauffeured transportation industry. As a result, Avis could pay less for licensing and labor.
Undermining the Business Model
Limo operators contend that Avis WeDriveU had the potential to seriously undermine the longstanding business model of chauffeured transportation operators and thereby radically remake the industry.
The Miami-Dade County Consumer Services Department ruled that Avis would have to follow county ordinances that require permits, fees, licenses, safety and background checks, and other regulations that apply to luxury chauffeured vehicles, said Ron Sorci, president of the National Limousine Association (NLA) and CFO of Miami-based Aventura Worldwide Transportation.
Avis avoided these rules because it had formed two separate companies — one for its chauffeured rental vehicles, and another one for its chauffeur service.
Officials also determined that Avis was violating its concessions agreement with the Miami International Airport. As a result, the Consumer Services Department received a letter from an Avis attorney confirming that the car rental agency had ceased its chauffeured service in the county, Sorci said.
Avis also is supposed to pull any WeDriveU advertisements in the county.
Sorci said the decision has national implications for the industry. “The same arguments we made in Dade County are the same arguments you can make in other counties throughout the U.S.”
Preemptive Action Taken in Other Cities
In April, regulators in Houston and Philadelphia have indicated that WeDriveU’s rental car and driver services business model fails to meet the standard definitions and rules that apply to luxury-based chauffeured transportation.
In Houston, the city’s aviation department, finance and administration department, transportation department, administration and regulatory affairs department, and the controller all sent “urgent” memos to the Mayor and City Council affirming that the Avis WeDriveU program was illegal and that immediate action was necessary, said Joe Jordan, president of the Limousine Association of Houston.
Jordan said city regulators are working to change the city’s chauffeured ordinance to state that vehicle companies can’t “require, recommend, refer or suggest” any outside driver.
Jordan will be hosting a seminar April 29 in Houston for association presidents and officers facing the same Avis issues.
In Philadelphia, the Pennsylvania Public Utilities Commission (PUC) operations concluded that the WeDriveU service would have to follow the Pennsylvania PUC regulations that already apply to state limousine operators. Avis would need the same type of permitting required by limo operators in Pennsylvania, including state licensing.
To date, the PUC has not seen any activity from Avis WeDriveU.
These cities join Phoenix and Atlanta as ones in which Avis chauffeured operations have been suspended or blocked, Sorci said.
Since Avis began operating, the NLA, the Florida Ground Transportation Association, the Florida Limousine Association, the West Florida Limousine Association and other NLA-affiliated associations nationwide have been blowing the whistle on these regulatory inequities, the LCTMag.com news report states. The decision against Avis comes after many meetings between association leaders and county officials, industry awareness efforts and a videotaped exposé of Avis chauffeured practices that was given to the Miami-Dade department.
The Miami-Dade decision concludes this phase of a 15-month battle for Carla Boroday, president of the Florida Ground Transportation Association and owner of Associated Limousine in Miami. Boroday was instrumental in first alerting the department to the Avis issue in the first quarter of 2008. She and other operators then repeatedly met with the Consumer Services Department through its Limousine Advisory Board.
The Avis Budget Group declined to comment for this story.
Sources: Martin Romjue and Linda Moore, LCT Magazine