There's a new news story about another young woman who has suffered the ultimate price for calling AAA. Every time I see this it just makes my blood run cold. I don't need much information to tell you that she died because the tower was not properly trained or paid for the job he's performing and despite all the statements made by AAA, there are no checks or balances as to the type person that gets hired to perform their tows.
This is an article I wrote some years ago on my old website. You will see that in Denise Polinchak's case, the story bears a striking resemblance to what happened to Melissa Gosule.
When I first broke this story some years ago, I received several communications from AAA's lawyers directly trying to get me to pull the article. Each time, I refused. The final phone call ended with me saying "Go ahead, sue me. Make me famous" I never heard from them again. I thought it would be useful to repost it and see if I get the same response I did last time.
There are references in it to the Melissa Gosule incident. Please be aware that at the time, the trial had not happened yet. In the end, they decided to settlle without admitting any wrongdoing. In my opinion (and many other people with far more legal expertise than myself), this was done to get the entire incident out of the news. I personally believe AAA still shares some fault in the death of both of these young girls. That is my opinion. You give me yours after you read the article.
"On the night of July 11th, 1999, Melissa Gosule placed a call to AAA through her parents to come rescue her and her broken down car. But when tow truck driver John Cubellis of Buzzards Bay arrived 90 minutes later, he informed Gosule that he couldn't tow her car, or drive her to another location for more than four hours because he was too busy,"
As reported by Boston.com, Melissa Gosule
Is AAA all it's cracked up to be? Are you getting what you paid for? Are you and your families safety at risk? I think Leslie Gosule, Melissa's father summed it up best when he said "AAA preys on our vulnerabilities, but when it came time to help Melissa, AAA and its agent did nothing,"
How well does AAA pay it's contractors? Can they attract responsible, well trained personnel? The industry has had a problem for a long time when it comes to how much the different motor clubs are willing to pay their contractors for services rendered. How do these rates affect your safety? Well, consider this. I have seen AAA pay rates as low as $15.35 for a 4 mile tow. $15.35! I have paid more for a lunch! In order for that driver and truck combination to make even a meager wage for the day requires 12 or more hours behind the wheel, 6 days a week. This driver can arrive at your scene dog-tired with equipment that is poorly maintained (because of the need to "keep it rolling") setting you and your family up for total disaster. The fact that some of these companies sport brand new trucks does NOT mean they are any more safety conscious and also doesn't mean they are as financially responsible as the new trucks make them appear.
A lot of these vehicles are bought through leasing programs from within AAA itself. They actually take the payments right out of the call receipts each month for the contracted provider. A program that can make a company, especially those with a not so good credit rating, even more dependant on AAA for their survival. Many of these vehicles exceed 100,000 miles in their first year on the road. If they are not constantly checked and proper maintenance procedures aren't performed on a DAILY basis, brake pads can be worn, wheel lugs can loosen, and a whole host of other safety issues can arise.
Most motor clubs rely on a performance rewards type system. This means a tow companies performance is graded by the motor clubs on several things, usually cost per call, estimated ETA, late ETA's, was the truck clean, was the operator clean and did the operator appear to know what he was doing. In an area where there are several companies vying for the same calls, the ETA's met part of this equation can be a recipe for disaster. Remember the Dominos "30 minutes or it's free!" program a few years ago? The result was a bunch of hot shot teenagers speeding all over town in a desperate attempt to get the pizza's delivered on time. People died. The same thing holds true for the competition between tow companies for some of these motor club calls.
The AAA contractor has an even worse scenario. Generally, AAA will give all the calls in a specific area to a "groomed" contractor. AAA is clearly the largest towing insurance provider on the planet. AAA grooms their contractors by flooding them with calls making it nearly impossible for the Tow Company to keep up. Many companies see this volume as a recipe for success and in their zeal, will start tossing caution to the wind in an attempt to maintain their relationship with AAA. They will begin buying trucks to meet the new demand and start dropping other higher paying, but lower volume customers. At some point, they become totally dependent on AAA for their livelihood. AAA can even offer in house financing solutions for new trucks to handle the increased call demand.
At some point, these companies become aware that they are in serious trouble financially. Their profit and loss statements begin to reflect the real truth about high volume, low pay tows. They start cutting corners in a vain attempt to curtail operating costs. The monies normally spent by a tow company for Safety and other related issues begins to dry up, their trucks and equipment begin to wear out and their experienced drivers begin leaving for greener pastures where they can get paid what they are actually worth. In the end, you have a company with beat equipment, operated by high turnover, beginning tow drivers (some with less than 2 weeks training under their belt). with little or no background o checks or drug testing who have been thrown into the automotive oceans and left to fend for themselves.
These contractors do attempt to get AAA to pay them more. Have you Ever heard the old saying "Power Corrupts and Absolute Power Corrupts Absolutely"? A good example of this misuse of corporate power can be found in an article written by an Attorney named Michael McGovern titled:
The following is a reprint from an article in Tow Times magazine from April of 2002. Michael McGovern is the author of this article. You can also find this article and the magazine it was originally presented in at www.towtimes.com
The Truth about AAA
Isn't it price fixin' or something?" He was a AAA contractor and had telephoned me to complain about the low rates he is paid for towing and service calls he performs for the world's largest motor club.
In an attempt to show how AAA pricing does not constitute a violation of the Anti-Trust laws, I told him about the time I was presenting a legal seminar at the annual convention of a statewide towing association in a midwestern state. My presentation was early in the morning. Later that day, four of the towing association members, who were also AAA contracted tow operators, approached me.
"We've scheduled a meeting this afternoon with the AAA road service manager at AAA's regional office down the street. We want an increase in our service call and tow rates," they said "Could you go with us?"
I told them I'd be happy to attend the meeting but, because I was completely unfamiliar with the particulates of their AAA contracts or their costs of operation, I could not speak on their behalf. They said they would like me to go with them anyway, so I tagged along.
We arrived at the AAA office and were escorted to the back of the building where the road service manager had a tiny office. He greeted us warmly, pulled five more chairs into his office and offered us coffee. The extra seating took up all the floor space. Without being introduced, I squeezed around the desk and quietly sat off to the side while the four tow operators sat directly in front, their knees touching the front of the manager's desk. The man in charge of the AAA contractors propped his feet up on his desk, leaned back in his chair with his fingers laced behind his head, smiled broadly and asked "Now, what can I do for you boys today?"
The tow operators, hats in their hands, told the service manager how their costs of operation had increased over the last several years. They compared their current insurance and fuel costs with those of two or three year's prior. They adequately explained the need for newer, safer, but more expensive towing equipment, and they told him how they were spending money to properly train their drivers in towing safety.
The man, still reared back in his chair, listened intently with his brow furrowed, nodding from time to time in apparent concern for their financial woes. The towmen then complained that despite the rapid increases in their costs of operation, the AAA contract rates had not increased. I recall that the rate was surprisingly low. They finished their spiel by asking for a rate increase. The room went quiet for what seemed like ten minutes but was probably only 15 or 20 seconds.
"You boys finished?" asked The Man, they all nodded silently.The front legs of The Man's chair slammed down onto the concrete floor with a loud bang, startling everybody, including me. He leaned forward across his desk, the big smile draining from his face.
"Let me tell you boys something. This ain't no f____ing marriage. If you don't like what I'm paying you - Quit!" he said bluntly. With his left hand he reached down and pulled a yellow legal pad out of one of the drawers of his desk and tossed it towards the now wide-eyed tow operators. The names and phone numbers of a dozen or so towing companies were handwritten in a list on the top of the pad.
"See that list? Those are all the towing companies that want your contracts and are willing to tow for me at the same rates that I'm paying you now." The Man started at the towmen for a few seconds, then he leaned back in his chair, smiling broadly again. "So, is there anything else I can do for you boys today?"
Shortly thereafter in the parking lot outside that AAA office, those tow operators were understandably angry. "What an SOB!" they fumed. "The nerve of that guy!" They turned to me. "What do you think of that?"
I agreed that the manager was a jerk, however I told them "I suppose he's right," They didn't care for my answer, but it was the stark truth. AAA is not engaged in price-fixing. So-called "vertical price fixing" occurs when a vendor is obligated by contract to purchase from one supplier and that supplier attempts to regulate the resale price, for example, an oil distributor setting the retail price for the gasoline it wholesales to it's gas station retailers. But a AAA service contract does not present a vertical price fixing situation because the tow operator is not charging fees to a third-party consumer at a rate fixed by AAA - AAA, acting on behalf of it's members, is the customer.
A towing service contract is a basic "arms length" independent contractor agreement. No tow operator is obligated to perform towing services for AAA and it's members. Every towing contractor serving the motor club does so voluntarily. And, as I explained to the AAA contractor who telephoned me recently, AAA tow rates are not determined by an illegal price setting scheme. They are set according to the length of the list on the yellow legal pad in the road service manager's desk drawer. :)
AAA has such a large percentage of the towing insurance market that everything they do has an effect on the industry as a whole. Even those companies that don't do AAA pay the price. With inexperienced drivers/operators comes more tow truck accidents. So much so that some of these AAA contract companies would never be able to insure in today's market without a little corporate help. All insurance companies base their rate structure on what could be called the "insurance pool" This is a means for weighing accident costs paid out in an area as compared to the revenues generated for a specific market segment. AAA contractors are in the same segment as all other towers. Higher incident costs because of lack of training and a willingness to overlook things like a few speeding tickets, or accidents on someones record in an attempt to fill the "seat" in a high turnover company hurts everyone across the board, even the non AAA company with the "perfect" record can't escape the higher costs just for being associated with this specific "insurance pool"
In fact, you could probably assume that AAA is providing insurance to these marginal tow companies at reduced rates as long as they continue to service their towing membership. This same insurance would not be available to any other company with the same abysmal performance records! This fact alone puts all other tow companies at an unfair advantage and also puts the general public at a much higher risk of incident.
Gary Coe, a founder and past president of the Oregon Tow truck Association says it best in an article he wrote that was also published in Tow Times magazine in July of 2002 entitled:
The following is a reprint from an article in Tow Times magazine from July of 2002. Gary Coe is a founder and past president of the Oregon Tow Truck Association and the Towing and Recovery Association of America, owns six towing industry related businesses and partners with his wife, Donna Coe, in industry seminars and towing company business consulting. You can also find this article and the magazine it was originally presented in at www.towtimes.com
AAA Article Right On Target
In 1959, we became a AAA contractor for downtown Portland, Ore. Our performance serving AAA members was excellent. Over the years, we approached no fewer than seven emergency road service managers at AAA with facts and figures, pleading for a rate increase. Many times I heard the same answer McGovern described in his article, "If you don't want the contract for what we are willing to pay, I have a list of people waiting in line for the contract."In February 1997, Speed's became part of the RoadOne consolidation. AAA was very concerned about Bill Miller's comments in a late 1996 magazine article about why he was consolidating towing services. As a result, AAA immediately cancelled four Speed's AAA contracts. AAA had to dig deeply to find the replacement contractors and it took seven companies to fill our shoes. Nevertheless, the service levels dropped drastically. AAA eventually had to start its own fleet of trucks to serve the core of the City. They soon discovered how much it really cost to run those calls. However, their staff was sworn to secrecy, because their cost was more per call than they were paying contractors.
In December of 2000, we were able to buy back our former Portland operations from RoadOne. We are far more profitable now than we ever were running AAA calls. Through an activity-based costing analysis, we realized that our cost per call is well above what AAA is willing to pay.
AAA is now capturing more and more non-member business. The AAA/General Motors contract was the most disastrous event to ever hit our industry. It took millions of dollars out of our pockets by turning dealership warranty tows from profitable work into below-cost work. Part of AAA's rate used to be based on a high per-centage of service calls. However, with computerized engine controls and fuel injection systems, a vast percentage of the "won't start" calls that used to be started, must now be towed to a repair shop.
Today, AAA has a new contract with Porsche. Towers are no longer towing just Chevrolets for this low rate. The risk exposure has now been increased while the pay remains at the same low rate.
Speaking of risk exposure, many towers have complained of the huge increase in the cost of insurance premiums. While we can immediately pass on that cost to many of our customers, how many AAA clubs will step up with an increase to address this cost?
Many (not all) of the other auto clubs and dispatch services have tried to pay a fair rate for volume business, sometimes more than double AAA's rate. However, now that AAA is competing with them in the marketplace for the business of GM, VW, Sprint, Porsche and others, a huge pressure is placed upon the other clubs to lower their bids for that business. Even though the other clubs are able to attract quality towers unwilling to work for AAA rates, some clubs are losing market share to AAA because they cannot bid as low to the manufacturers, many of whom are focused on lowest cost instead of high quality.
Let me ask this of the AAA towers reading this: Are you proud to be associated with all of your fellow AAA contractors?
Most AAA clubs have established a mileage rate that their contractors are "allowed" to charge the club and members for tows beyond the member's basic coverage. Many AAA contractors, to avoid confusion of their own employees, end up adopting that AAA mileage rate as their commercial mileage rate. Then, when municipalities take a survey of towers to see where their law enforcement contract rate should be set, that low AAA mileage rate has an artificial lowering impact upon the average. Because of this, AAA has yet another negative impact on overall mileage charges within our industry.
Until enough towers walk away from below cost work, there will be a continuing downward spiral of towing rates. The time is now to determine the future of your company.
Gary mentions something in his article that I want to expand on a little. When you buy a new car, you get a warranty package that usually includes some sort of towing solution. In the past, these warranty tows were handled by the dealer, usually through a local tow company that the dealer had already investigated and chose specifically to handle their customers and their brand new cars.. This meant you could reasonably expect a highly qualified operator with good equipment to help you get your new vehicle to the dealer safely, efficiently and in a timely fashion.
Now, AAA has managed to wriggle control of these local tows away from the dealers and placed them in the hands of the manufacturers. GM, Porsche, VW, and even BMW have opted to remove this control from the local level and dole it out nationally using AAA.
I must tell you about a day just a few weeks ago. I was delivering a BMW SUV to the local BMW dealer. I had just finished stowing my wheel straps after removing the car from my bed and was getting ready to leave when I saw the most amazing thing. In the driveway of this dealer came a AAA contractor's brand new International flatbed tow truck. On the back was a brand new Mini Cooper. The Mini cooper had been secured using two motor cycle straps. One on the right rear wheel, and one on the left front wheel. You know the straps of which I speak, they have about an 800 lb breaking strength. I couldn't resist. I asked the operator if he thought that was safe. (it was obvious the car had been shifting around dangerously on the bed as it was now at an angle and up against one of the side rails) He told me that it was safe enough. He had set the emergency brake and drove a little slower than usual to avoid any sudden stops. I didn't say a word. If that driver would have had to make an emergency stop, that Mini Cooper would have came right into the cab and killed him, not to mention the possibility of it just lazily rolling off the end of his truck while in transit. I just got in my truck and left. This is a perfect example of lack of training coupled with an overload of tow calls. He probably had 4 or 5 more calls backed up in his pager and was in a big hurry. If you were the proud owner of a brand new $80,000 Porsche, wouldn't you expect your Dealer to send you someone who was fully qualified and trained to tow your vehicle in for repairs?
Overworked and underpaid. In the towing industry, a large share of beginning towers start with a AAA company. Why? because all you need is a pulse and a valid drivers license and you're officially a "tower" Training for the job when I joined the AAA team some years ago consisted of a 1 week ride-along. Mostly so I could see which part of the bumper to attach my single J hook to.
The question still remains: Who do you really want to send to rescue your daughter late at night on some lonely stretch of highway?







