After Acquisition, RMA and Addison Lee Plan for Post-Covid-19 Rebound
Addison Lee’s Michael Fogarty (left) and RMA’s Robert Alexander talk:
- The impetus behind and the benefits of the acquisition
- Covid-19 safety measures
- Projections for return of business travel
RMA Worldwide Chauffeured Transportation earlier this year acquired the North American division of U.K.-based Addison Lee Group, creating a combined network of more than 25,000 customers and 20 million annual passengers. The companies’ combined fleet includes more the 700 vehicles and, prior to the Covid-19 crisis, more than 1,000 employees. RMA CEO Robert Alexander and Addison Lee Group North America president Michael Fogarty spoke recently to BTN senior editor Michael B. Baker about the companies’ plans to combine operations, manage through the crisis and help rebuild demand.
BTN: How did the acquisition come about?
Michael Fogarty: The Addison Lee Group was owned by Carlyle, and they made a decision that they were going to exit the investment after a number of years and began a sales process. Originally, it was the sale of the entire group. That did not happen. We began a separate sales process for the U.S. As we looked at the potential operators to acquire the Addison Lee business here in the U.S., the company that I had a longstanding relationship with, that I knew viewed customer service in a similar light, was RMA. We were able to come to an agreement with Robert and consummate the transaction, and we’re very excited about what the future brings between our experience in the industry, the combined customer base and the synergies that we’ll get from the infrastructure as well as the enhanced coverage geographically. When you think about the chauffeured industry in the United States, so much of it takes place between Washington, D.C., and Boston. Now, we have owned fleet from Richmond, Va., up through Boston, which puts us in a unique position to focus on the largest sectors for the ground transportation business.
Robert Alexander: We both had robust global networks as well, so the combined forces of that makes us able to be a better partner around the globe, which allows us to dictate better service levels and hopefully better pricing.
BTN: How will the two companies’ footprints come together?
Fogarty: RMA had an owned presence from Delaware south, and Addison Lee’s presence was Delaware north, so you put the two together, and take the Mid-Atlantic and Northeast, and you have it pretty much covered.
BTN: What advantages will there be to combining operations beyond network?
Fogarty: There’s certainly benefits from a technology standpoint. There’s benefits from a sales, marketing and resource standpoint. It’s a larger employment base. Even things like negotiating benefits for chauffeurs, it’s a much larger pool of people that you’re purchasing those benefits for.
Alexander: The most exciting thing for me is that our pool has expanded internally in the company, and we’re using this talent to retool all the companies. From a client-looking perspective, we’re able to take this pause and do it on a systemwide global basis, how we’re training our people to answer the phones or training our chauffeurs. RMA had best-in-class technology, and we now have software that will run the whole company and make the customer experience from a reporting and technology standpoint much better. They’ll have much more opportunity to get things they need when they need it, including booking online seamlessly or via an app. We’re taking this time to streamline all our processes and everything we do to make the overall customer experience better.
BTN: What sanitization measures are you taking amid the Covid-19 crisis?
Alexander: One of the resources is making sure there’s a clean car standard, and the [National Limousine Association, of which Alexander is president] is still working to determine what that standard is, whether it’s using different chemicals or the mechanism to put those chemicals on. The important thing is making sure the people have protocols to thoroughly clean the car every day. It’s making sure your people are trained, and this will be the defining moment for us and [transportation network companies, such as Uber and Lyft]. Major League Baseball [in recently released protocols] said they don’t want their players using TNCs, because there is no assurance from a random person driving a car is going to take the time to wipe down every door handle, every nook and cranny and make sure the car is a virus-free as possible between each ride. We’re making that commitment and training our people to do it and making sure they have the tools they need to make sure this new environment that the cars are as sanitary as possible. There’s been debate about sneeze guards, so to speak, between the chauffeur and the passenger. Some operators want to do it and some don’t. My concern is, the doctors said it would be a good mental protection, but it’s another surface that needs to be cleaned. We’re taking the approach that everybody getting into a car or vehicle has to be wearing a faceguard, whether you’re a driver or a passenger. We’re going to put that in our contracts with people as long as the threat is there. We’re viewing it as, we’re a bubble between people’s homes and the destination they’re going to.
BTN: Are travel buyers involved in your conversations as you look at policies and protocols?
Fogarty: One component of our business is corporate shuttles. With social distancing, and the idea to keep the driver somewhat separate from the passengers, we are in discussions with people about plexiglass compartments, so you can separate them. How many seats or rows are you going to utilize in the shuttle? There’s definitely an opportunity to collaborate with customers and come up with a solution that meets the latest guidelines from the [U.S.
Centers for Disease Control and Prevention] and the company’s own internal guidelines.
Alexander: We’re going to do whatever makes our clients feel the safest and keeps them out of harm’s way. If they say they want this, we’re going to figure out a way to make it work. That’s going to be the difference between being successful and really successful.
BTN: Will travel buyers be less price-sensitive as they seek to build up travel programs again?
Alexander: At some point, you may have to say, this company is a little more expensive, but they’re safe. If I was a travel manager, I’d want assurances that people have the resources and are going to do what they say they’re going to do.
BTN: What’s your outlook on the timing of demand recovery?
Alexander: When you look at Facebook saying May 2021 is when they’re going to have large meetings again, that’s a ridiculously far-out timeline, considering we don’t know what will happen between now and then. I know you can move it back up, but my own gut feeling is: Humans are social creatures. We need to get out and do things. Maybe there will be more stay-at-home working, but people want to go out and see their customers, go to dinner and travel. Things will have their way of opening up. In the fall for sure, we’ll be not 100 percent, but we will start the ramping back up with people moving around, going to meetings and doing things. We’re certainly hoping to get to our employee level, which was well over 1,000 pre-Covid-19, much sooner than later.