The Automobile Association


The Automobile Association

The Automobile Association (The AA) was a British motoring association that became a private limited company in 1999, and is owned by two private equity firms.

History

On June 29, 1905 a group of motoring enthusiasts met at the Trocadero restaurant in the West End of London. This was the inauguration of the Automobile Association, formed to help motorists avoid police speed traps.

By 1906 the AA took a stand on road safety issues, and erected thousands of roadside warning signs.

In 1908 the AA published the "AA Members' Special Handbook", a list of nationwide agents and mechanics. The following year saw the introduction of the AA's free legal system.

Between 1910 and 1929 the AA introduced "AA Routes", and it continues to produce travel guides and maps. AA Publishing has grown to be an important UK publisher of travel literature. From 1912 the AA began inspecting hotels and restaurants, issuing the coveted "AA Star Classification" to those deemed to be of sufficient quality. By 1914, the AA had grown to 83,000 members. In the 1920s it introduced pre-purchase and post-accident repair checks.

By 1939 the AA's membership had grown to 725,000, a number equivalent to 35% of all cars in the United Kingdom. When World War II ended the AA began to protest about wartime petrol rationing. The campaign was successful and rationing was repealed in 1950. This was the first of many campaigns that were aimed at championing the rights of British motorists.

Other AA campaigns include the compulsory wearing of seat belts, and the introduction of lead-free petrol. Seat belt legislation became law in the UK in 1983.

1949 saw the launch of the AA's breakdown and recovery service. Initially only available in London and surrounding districts, it has been extended to cover most of the UK.

The "AA Insurance" brokerage service started in 1967. AA Insurance is the UK's largest motor insurance company. The service was extended to cover home and life insurance and also includes pet, travel and business insurance.

In 1973 "AA Roadwatch" began broadcasting traffic alerts on UK commercial radio stations. It grew to become the largest broadcaster of traffic information in Europe. "AA Relay" was introduced in 1985, a service that will deliver a broken-down vehicle, its driver and passengers, luggage and trailer to anywhere in Britain.

In 1990 the "AA Driving School" was launched. It now employs more than 2,050 qualified driving instructors.

By 1994, AA's membership was at eight million. Current estimates place the figure at over twelve million members.

In 1998 the AA closed down its 142 high street shops resulting in a loss of 1,000 jobs. These shops had sold insurance, AA membership and various motoring products. [http://news.bbc.co.uk/1/hi/business/the_company_file/145699.stm]

In 1999 the AA demutualised and was sold to Centrica, the holding company of British Gas. Each full personal member of the breakdown service in the UK and Ireland received a payout of over £100. The AA Motoring Trust was formed in 2002 to take over the non-commercial activities of the AA.

In 2004 the AA was sold for £1.75 billion to two European private equity firms, CVC and Permira.

A new headquarters building for the AA, Fanum House, was opened in 1973 by the Queen. It is in Basing View, Basingstoke, north Hampshire. In 2001, while the AA was under Centrica control, the HQ moved to Farnborough, also in Hampshire, but returned to Basingstoke in October 2005 following the sale to CVC Permira.

On 8 May 2007 the AA was the focus of the BBC's "The Money Programme". The sale of the company to the CVC Permira was criticised and the detrimental effect this has had upon the company's performance was exposed. Following the October 2005 buyout the company has been saddled with £1.3 billion of debt and the number of patrols was cut significantly, with many of these cuts said to be under unfair circumstances; a third of the 10,000 staff were cut in order to "improve efficiency". Tim Parker, the current chief executive, has since admitted that the cut-backs were too great, and that with the increased work load in the 2006 summer they required more patrols.

It has since been announced that CVC Permira is looking to sell the AA for approximately £3 billion, marking a substantial profit, even after repayments of debt. On 25 June, 2007 the company announced that it is to merge with Charterhouse's Saga, another private equity owned company, which provides services including insurance and holidays to over 50s. The new holding company, Acromas Holdings, will be owned by CVC, Permira, Charterhouse and staff. The deal valued the AA at £3.35 billion and the combined company will be worth more than £6 billion, making it the 20th largest company in the UKFact|date=July 2008.

Campaign for Safe Road Design

In July 2008 the AA became a partner in the Campaign for Safe Road Design which is calling on the UK government to make safe road design a national transport priority cite web|url=http://www.saferoaddesign.com/media/2024/safe%20roads%20final.doc|title=SAFE ROAD DESIGN TO SAVE UK £6BN EVERY YEAR|accessdate=2008-10-01 |format=Word DOC |publisher=Campaign for Safe Road Design ] .

See also

* AA Motoring Trust — The AA's road safety charity
* AA Ireland
* American Automobile Association
* RAC
*Green Flag
*Vehicle recovery
* Campaign for Safe Road Design

Gallery

References

External links

* [http://www.theaa.com/ The AA website]
* [http://www.theaa.com/travelwatch/planner_main.jsp AA Route Planner]
* [http://www.aacardatacheck.com/car-data-check/ The AA Car Data Check Site]
* [http://www.theaa.com/insurance/car-insurance.jsp AA Car Insurance]
* [http://www.aatravelinsurance.com/ AA Travel Insurance]
* [http://www.vehiclerecovery.org/history/index.htm UK Vehicle Recovery History]


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