Limo business ‘in awful shape’ as weddings, cruises and conventions canceled
Proms were canceled. So were Spring weddings. Bachelor and bachelorette parties? Not happening. Cruise ships remain parked. Corporate travel is practically non-existent. Night clubs remain closed.
Five months into the coronavirus crisis and still there is no demand for limousines, which is devastating news for Lenin Fraga, owner of Doral-based American Transportation and Limo Services.
His 22 vehicles sit mostly unused in a warehouse. All but a few of his 20 drivers were laid off. His company typically brings in $250,000 to $300,000 per month from March through May. This year, he made barely $3,000 per month.
There was a slight uptick in mid-June, when businesses began reopening after COVID-19 lockdowns, but two weeks into July, Fraga said the cancellations are pouring in.
“We were getting hopeful, but now a lot of cancellations again,” he said. “People who had postponed weddings from March and April to October, November are now canceling and saying maybe next Spring, or maybe they won’t do anything at all. Corporate travel has not come back at all, zero, nothing.
“Our main core is corporate travel, cruises, meetings and events, weddings. None of those things are happening. It’s completely out of our hands. Our whole industry is in awful shape.”
He normally has 70 to 80 rides per day in July. Now, he is averaging 10 to 12 per week.
“We had only gone up to 10 to 15 percent of our normal business, but now it is almost zero again,” Fraga said.
He got a $5,000 PPP loan, for which he is grateful, but that will not keep his business afloat. He would love to bring drivers back and get them on the payroll, but without reservations, there is no need for drivers.
“I can’t bring drivers back to work if they have no work,” he said. “What will they do, sit around and play dominoes?”
Meanwhile, he has loans to pay back for the vehicles. The Super Bowl in February was a big boost to his business, but a month later, the downward spiral began.
“I invested on more vehicles for the Super Bowl, and things were doing well, but now I am deeper and deeper in debt and no income other than what the government gave me,” Fraga said. “I really don’t know what’s going to happen. I have so many loans on the vehicles, I asked for deferrals. Some lenders are being helpful, some are not.
“It’s completely out of our hands. The government has to step up and continue to subsidize small businesses. If they’re going to close us down, they have to help us out. If not, we will be out of business.”
Fraga fears that business will not pick up much the rest of 2020. With that in mind, he is trying to start up a side business with a vehicle washing machine he purchased in January. It is a tall machine equipped to wash trucks, so he got a trailer for it and is hoping to make money washing other companies’ vehicle fleets.
“I have to be creative, because I have no choice,” he said. “We live in a capitalist country. You have to work to make money. If you have no work, you have no money.”
This story was originally published July 20, 2020 at 12:00 AM.