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Working with chauffeured transportation suppliers.

Article Excerpt
Chauffeured transportation services usually are a small proportion of a company's overall travel expenditures, but a growing number of travel buyers are employing the same negotiation techniques with car service companies that they do with other travel service providers--namely, with requests for proposals. The biggest service providers all say the number of corporate RFPs has increased--some said even tripled--during the past year. The increase in requests for proposals indicates that travel buyers are looking at more factors than price when selecting a chauffeured transportation provider. RFPs can address driver training, fees and surcharges, consistency of service and security. The shifting market also may spark consolidation among car service providers, and give large, multinational providers an edge over regional suppliers. As corporate customers increasingly manage this part of their travel spend, suppliers are responding by providing the same sorts of services--including online booking, preferred pricing, data reporting and more payment options--that other types off travel suppliers offer.

The four leading suppliers in the market--Carey International, Dav El Chauffeured Transportation, Empire International and BostonCoach--all have announced intentions to build an international network. Future development is centered on Europe and Asia, reflecting growing customer demand in those regions, they said.

Car service providers continue to update amenities in their fleets. XM Satellite Radio has proven popular with customers, suppliers said, and wireless Internet access also may be available. Suppliers also are using technology such as driver cameras to lower insurance rates and fleet control systems to manage inventory.

High gas prices continue to plague car service providers, who have passed increased costs on to customers with surcharges or rate adjustments. According to the U.S. Energy Information Administration, retail gasoline prices are projected to average $2.42 per gallon in 2006, compared to $2.27 per gallon in 2005. An RFP should provide a clear explanation of the fuel surcharges to be applied and whether these fees would be lifted if gas prices drop.

Here are the primary points you should consider in negotiating with car services firms:

I. GATHERING DATA

Because the dollars spent on car service often are more difficult to quantify than...