Jangling Surprises Mark AFLA Meeting - Will German ‘superiority’ lead industry?

All aboard the Marlyn agreed the evening boat ride on Lake Michigan, complete with hot jazz, cold drinks, good food and stunning views of Chi­cago’s glittering skyline, was an in­spired bit of conventioneering. But the next morning’s keynote lecture on German “superiority” in both the auto industry and in dealings with the oil- producing Arab nations drew sharp re­ actions of patriotic outrage from many of the 250 delegates to the annual Fall Meeting of the Automotive Fleet and Leasing Association.

The address by Herr Paul Vollmer, billed as a “consultant” to the German auto industry, was just one jangling surprise in a meeting made notable by a series of unexpected presentations. For instance, who would have expect­ed the tough young leader of one of the country’s largest leasing firms to decry a lack of leadership in leasing? And who would have thought the busy, brilliant headquarters boss of the coun­try’s premier fleet management associ­ation could break away from his own group’s affairs long enough to tell AFLA members that increased govern­ment regulations will result in costlier cars being driven for longer durations over deteriorating roadways?

Another surprising AFLA speaker quoted insurance industry studies that show highway deaths will rise in direct proportion to the greater use of smaller cars — unless the acceptance of air bags becomes a fact of highway life. That same speaker, Don Costa of the Allstate Insurance Company, alerted AFLA members that planners within the Occupational Safety and Health Administration are considering defin­ing the fleet car’s driver’s seat as a “work place,” suggesting the fleet administrator may soon be even more responsible for the safety of his or her drivers than is currently the case.

The original idea to rent the Motor-ship Marlyn for a floating reception came up about six months ago when planning for the AFLA Fall Meeting was launched. The expensive idea (too rich for AFLA’s modest coffers) was made seaworthy when the folks at Auto Driveaway agreed to christen the scheme with cash for captain, crew and commissaries.

AFLA delegates registered for the Fall Meeting aboard the trim vessel, which then shoved off from her moor­ings adjacent to Chicago’s colorful Buckingham Fountain and sailed the calm waters sparkling with moon­ beams and the running lights of pleas­ure craft.

As if the Marlyn herself were not surprise enough for a convention, AF LA President John McKean of Pitts­burgh’s LMV Leasing dipped into his duffel bag, pulled out a trombone and proceeded to blow with the ship’s musicians. Drawn to the swinging sounds of the jam session, Berge “Duke” Tookman of Cleveland’s Fleet- way System joined the group and strummed the bass ‘til his fingers grew blisters.

AFLA Fall Meeting participants got down to serious business the following morning with an informal coffee held in Chicago’s Sheraton Plaza Hotel and hosted by Toyota. There followed a brief opening greeting by AFLA Presi­dent McKean and welcoming remarks by Paul Valentino of Roto Lincoln- Mercury, who served as program co-chairman with Jerry McCarthy of Fire­ side Chrysler-Plymouth. Valentino and McCarthy are credited with setting the festive Marlyn reception afloat.

At the outset, there was something suspect about the presentation of Herr Vollmer on how the German auto in­dustry will not only set trends, but will take on the role of world leader in car making. Herr Vollmer traced the history of the Mercedes auto line from its 1892 beginnings as a tiller-steered horseless carriage through its distin­guished service in a couple of note­ worthy wars, concluding with the ob­servation that Mercedes limos are prov­ing to be more popular playthings with oil-rich Arab sheiks than American-built luxury cars.

VENTING AUDIENCE TENSION

Maybe it was the heavy accent or the way Herr Vollmer sort of clicked his heels and arched an eyebrow as he spoke of German “superiority,” but the audience was seething noticeably. An accomplished orator with a precise sense of timing, Herr Vollmer would deliver a really funny punch line at exactly those points where his listeners appeared ready to charge the speakers’ table, thus venting the tension.

It was just after one East Coast leas­ing man challenged the speaker with the statement that high-priced German imports have more maintenance prob­lems than American luxury cars that a surprising change took place in Herr Vollmer’s demeanor and speech pat­ terns. The ramrod-straight stance sud­denly drooped and became rather grandfatherly. The stern gaze of authority turned smilingly soft. Without warning, the Prussian accent was re­placed by a voice that sounded unmis­takably Midwestern.

The room rocked with roars of laughter and a standing ovation as the AFLA members realized they had been put on! Herr Vollmer, noted con­sultant to the German auto industry, was a fake!

In actual fact, Paul Vollmer is a re­ tired construction industry association executive who lives in Milwaukee and agreed to perform his Third Reich rou­tine as a favor to AFLA President McKean, in hopes the adrenalin surge prompted by the controversial com­ments would carry over to the sessions that followed.

Paul Valentino served as moderator of a round table discussion probing the “Necessary Ingredients of a Deal.” Panelists at that session were Jim King of the 3M Company, George Watt of LMV Leasing, and Don M. Howard of Fred Oakley Motors. In general terms, the panelists agreed that fleet buyers, auto dealers and leasing agents must learn to treat each other “as if their roles were reversed.”

King told how his company has es­tablished a policy of buying cars through dealerships convenient to the drivers, which eliminates drop ship­ments and reportedly makes for better service after the sale. King said 3M generally restricts choices of options available to drivers, and requires the drivers to directly pay the dealers for any optional equipment they do order. King disclosed that by requiring drivers to maintain a face-to-face relationship with the selling dealers, 3M benefits by speedier service on warranty work fleet discounts on parts, sales tax ad­vantages, and more accurate paper­work.

PROBE CONDITION REPORTS

In a discussion of condition reports, the panel was split over whether such groups as AFLA should pioneer in the development of a standardized condi­tion report form. King believes auction people tend to produce more accurate condition reports because they have no axe to grind in the sale of a particu­lar car. Watt said condition reports as they currently exist prompt disputes between leasing companies interested in recovering maximum residual value from a car and lease clients who frequently disclaim responsibility for damage. Howard thought a standard­ized condition report form would help improve relations between dealers and fleet customers, while Valentino ob­ served that many fleet operators, leas­ing firms and dealers have designed their own condition report forms t meet their own needs, and that is how the situation should remain, he de­clared.

Meanwhile, Jerry McCarthy of Fire­ side Chrysler-Plymouth moderated a panel discussion entitled “How the Used Car Market is Determined, Fore­casted, Exploited and Disregarded.” Panel members were Jim Clark of the Rockford Auto Auction, Arnie Spiel­ berg of GAF Corp., Sol Nieman of McCullagh/CCIC Leasing and Phil Kinzer of First Lease. The group con­cluded that the used car market is largely determined by auto auction ac­tion around the country and the “dockers” (read odometer tamperers) will only be eliminated when concern­ed industry people get angry enough to purge them from their midst. At the close of the discussions headed by Valentino and McCarthy, the AFLA members broke for a cocktail recep­tion and reassembled for lunch.

The lavish luncheon was hosted by the Chevrolet Motor Division. Featur­ed speaker Chuck Parker, president of Rollins Auto Leasing Corp., snapped his listeners to attention with the flat-out statement that leasing companies are no longer in the leasing business. Pointing out that little has changed in the basic lease plans available for the past 20 years, Parker said lease people must come to think of themselves as being in the people service business and the fleet management business, not just the leasing business.

SEEKS LEASING UNITY

“The one thing that separates one so-called leasing company from the other is its people and the service they ring to each fleet management prob­lem,” Parker said. “The marketplace is searching for service and people who care,” which Parker believes explains the “fickle” behavior of lease clients who jump from one firm to another, sometimes even before their lease agreements expire.

“Leasing is perhaps the most: mis­understood financial and service con­cept in America today,” Parker noted, suggesting the major leasing firms have far to go in the training of their people and the demanding of integrity and professionalism from those who would lease cars to clients. Citing similarities between rental and leasing concepts, Parker said, “The walls and mythology that separate what is basically the same business need to be tumbled and burst.”

Parker issued a call of unity to such groups as AFLA, NAFA, CATRALA, AALA “and every other alphabet mix­ture in our business” that need togeth­erness, if not in organization, at least in spirit, intent and direction.

Pointing to the ever-present spectre of further government regulation, Parker opined that, “We can be more of a resource to the government as it gradually moves toward a national transportation and energy policy. We can inform and educate those who make and shape laws and regulations. We can stop the clockers and bring credibility, integrity and trust to the used car industry in this country,” he said.

Perhaps the most insightful com­ments Parker made were his remarks on the lack of leadership in leasing. “People want to grow, to participate, to give, to be a part of something significant. We don’t just need managers, we need managers who are really leaders. We need leaders who will define strategy, direction and objectives.

We need people who can tell us where we are going and give us the courage and foresight to get: there; who can meet demands, overcome constraints and make choices,” Parker said, con­cluding his address amid a rousing wave of applause.

Among the post-luncheon surprises was the address by Bob Berke, execu­tive director of the National Associa­tion of Fleet Administrators. Berke says the best information NAFA peo­ple can come up with points to more government regulation in the design, efficiency and safety features of fu­ture auto offerings. He cautioned his listeners to expect higher prices for new cars, higher license fees, increased repair and insurance costs, and a grad­ual decline in street and highway maintenance throughout the country.

FLEET INFO PIONEERS

Berke believes shoddier road condi­tions will result in decreased tire mile­ age and more front-end and suspension repair work. He believes the trend to­ ward longer periods between oil changes and other preventive mainte­nance procedures will result in more major drive-train work because fleet cars will not be routinely checked out as they have been.

Also, Berke predicts car-makers will be offering fewer and fewer choices with coming new-model years.

On the positive side, Berke believes NAFA members will pioneer in the development of better fleet informa­tion systems, including the use of desk top computers to slow runaway fleet costs and maintain tighter control over mileage and repair problems.

Looking to future generations, Berke disclosed that the NAFA Board of Governors approved a plan in coop­eration with Columbia University that will hopefully result in wider under­ standing of the problems of fleet ad­ministration. The NAFA Foundation donated $50,000 in seed money to prepare case histories and other study materials so that future business school grads will have a handle on fleet prob­lems and their solutions.

The life-saving value of airbags was explored in an address and motion pic­ture screening presented by the All­ state Insurance Company’s Don Costa. With a proven record covering nearly 12,000 cars driven an estimated 320- million vehicle miles, only four deaths have been tallied in 108 crashes involv­ing air-bag equipped cars, Costa re­ ported. Costa sees the increased use of smaller cars as a “dangerous trend,” unless such cars are equipped with air bags.

Other speakers on the information-packed AFLA agenda included Lloyd McPherson of Gelco Leasing; Jim Healy of Automatic Radio; Bob Mc- Garvey of Beach City Chevrolet; George Largay of National Car Rental, and E. Pierce Walsh of Warren Buick. Noting the Fall Meeting produced one surprise after another, AFLA President McKean gaveled the affair to a close with the promise of “even more sur­prises” next year.