As he looks out on the Capital Beltway from his office in Falls Church, James B. Creal sees an ominous threat to the "American Way of Life."
"There's an anti-automobile group in the United States," said Creal, the president of the American Automobile Association. "Some of them say: 'Scrap all your cars and use public transit.' "
Creal and the AAA portray the anti-car camp as the devil incarnate. From the AAA's early days at the turn of the century, when it battled autophobic horse lovers, to its more recent tangles with Ralph Nader's consumer advocates and public transit promoters, the organization has played the role of grand chaperon in America's national love affair with the automobile.
Yet today, ensconced in a sprawling six-floor complex near the intersection of I-66 and the Capital Beltway, the AAA headed by Creal has diversified into far more than just an auto service and lobbying organization. Despite a surge in competition from rival auto clubs, the AAA has continued an amazing growth rate that saw its membership top 25 million last year, prompting its chief spokesman, W. Allan Wilbur, to proclaim it "the largest membership organization in North America and probably in the world."
More importantly, the AAA -- a not-for-profit, tax-paying corporation acting as an umbrella organization for its 167 affiliated motor clubs -- also has become a billion-dollar-a-year conglomerate that, if it were a public for-profit company, would rank among the 10 largest businesses in the Washington area. AAA has 800 employes at its Falls Church headquarters. Its multiple business interests -- ranging from selling insurance and airline tickets to operating cruise ships and an amusement park -- are generating ever higher revenue even as they cause some grumbling from longtime members and outside critics.
But there is little doubt that, whatever else it does, the AAA has parlayed auto use into a lucrative cash cow. Last year, for example, the AAA and its affiliates -- located in every U.S. state, except Alaska, and in all of Canada's 10 provinces -- generated more than $1 billion in revenue for the first time, including more than $560 million in dues from members (the cost to members varies from about $15 to about $70 annually, depending on which of the local clubs one belongs to and the membership options chosen).
That's only a small part of the AAA's income stream. It also operates a travel business that books airline flights and other travel accommodations for members at 750 locations around the country and sold $1.7 billion worth of American Express travelers' checks last year.
"We're the largest seller of airline tickets in the country other than the airlines," said Creal. "And we're the largest seller of American Express travelers' checks in the country. It [travelers' check sales] has been up quite dramatically. We've really been promoting this."
In addition, the AAA:
* Sells auto insurance (with face value of $1.7 billion in 1983).
* Distributes reduced-fee Visa credit cards through various banks nationwide (offered for a $10 annual fee through First Virginia Bank in this area).
* Books ocean cruises, obtains discounts on rental cars for members, and publishes maps. In fact, 250 million AAA maps are distributed annually, making the group "one of the largest publishers of anything and certainly the largest publisher of travel material in the country," according to Wilbur.
Then there are the separate and equally diverse affairs of the AAA's semi-autonomous affiliates, which account for the bulk of the organization's total membership. (AAA officials insist the organization is more correctly viewed as a federation of its affiliates rather than as a single monolithic entity.) The Michigan Auto Club, the third-largest in the AAA constellation, operates the Bob-Lo amusement park outside Detroit.
Because federal law shelters not-for-profit corporations (which differ from nonprofit groups because they pay taxes, and from profit-making groups because they can't distribute earnings to shareholders), the AAA does not have to disclose its earnings publicly or account publicly for what it does with its revenue.
According to Wilbur, AAA is a "membership corporation," neither publicly nor privately held, with no capital stock. Each affiliate club is a separate corporation chartered under state laws and governed by its own officers and board of directors, Wilbur said. The headquarters operation is governed by an 18-member board of directors -- including Chairman William M. Skillman, a Troy, Mich., accountant -- drawn from affiliate clubs. The board elects officers of the parent corporation.
Much of the criticism aimed at the AAA centers on its historic role as a part of the national auto lobby, pushing for the construction of more highways over funding for mass transit and promoting positions on safety and consumer issues that critics say are virtually indistinguishable from stances taken by General Motors and Ford. With a $1.5 million annual budget for its public affairs and government affairs departments, and an army of lobbyists in Washington and virtually every state capital, the AAA wields substantial political clout. Creal's office is adorned with pictures of him with every U.S. president going back to Lyndon Johnson.
The AAA supported a campaign that won a test ban on heavy trucks from the left lanes of the Capital Beltway. And late last year, the AAA formally came out against mandatory installation of air bags or passive restraints in automobiles, citing a nationwide survey it conducted showing that 67 percent of those questioned preferred mandatory seat-belt-use laws. The auto companies also favor mandatory seat-belt laws, and the AAA is now lobbying in state legislatures for the passage of such legislation.
"I really don't see them [the AAA] ever taking a position that would rattle the auto companies," said Clarence Ditlow, director of the Ralph Nader-funded Center for Auto Safety. "Why couldn't they do more on an issue like [auto] import quotas? For an organization that has that many members, their lack of input on some of these issues is frustrating at best."
But Creal insists that the AAA's primary purpose is to defend the rights of automobile drivers, not the auto companies.
"Every time we happen to agree with the auto companies, people say we're in bed with the industry," Creal said. "Every time we happen to disagree them, people don't say anything."
On what issues does the AAA disagree with the auto industry?
"We want them to put a hook underneath these little cars for when they have to be towed," said Creal.
The lack of such hooks has made the job of towing many small American-made cars more difficult, Creal said, so it was natural for the AAA to launch a campaign to persuade a reluctant Detroit to install them.
"After all," he said, "we know more about towing a car than anybody.".
But some longtime members and critics contend the AAA ought to stick with towing cars. They complain that the organization has taken a wrong turn with its diversification into the business world.
"An auto club should concentrate on services to its members," said Leon Mandel, editor in chief of AutoWeek, a prominent Detroit-based automotive weekly. "Cruise ships, amusement parks and the profitability of an insurance business tend to distract the attention of management.
"I'm looking outside at the snow now," added Mandel in an interview several weeks ago. "And I'm thinking my wife might need a tow truck, but all their phone lines will be tied up because they're booking airline flights or selling insurance or arranging for the repair of the boat that goes to their amusement park."
"People who make those comments don't really know what they're talking about," retorted Creal. "You have to invest your money someplace. . . . And almost everything we do has to do with the automobile."
According to Creal and other AAA officials, revenue generated by these far-flung business operations -- combined with AAA dues -- is plowed back into the organization to strengthen and expand its numerous services to members. These range from the group's standard emergency road and towing service and "Triptik" travel services (individually tailored map routings for your vacation) to newer offerings such as diagnostic clinics for members' automobiles.
In 1982, the AAA installed its 24-hour-a-day "Supernumber" operated out of its Falls Church headquarters, which allows members to call in from anywhere in the country that their car has broken down and instantly obtain the name and phone number of the nearest AAA-approved service stations that can tow them. The Supernumber currently takes about 1,000 to 1,500 calls per day, the AAA said.
If the AAA weren't keeping up its service to its members, Wilbur contended, it wouldn't have had a 5 percent growth rate in each of the past two years while other auto clubs were aggressively seeking to break off a huge chunk of the auto club market.
Yet competing auto clubs are making inroads into that market. Since their founding in the 1960s and 1970s, these competitors -- among them Amoco Auto Club [now being offered through the American Express Co. to its cardholders], Montgomery Ward Auto Club, Exxon Auto Club, Texaco Auto Club -- have garnered a combined total of 17 million members, more than half that of the AAA, according to the AAA's own estimates.
"These oil companies can come in with a cheaper price and sometimes with a lesser product," Wilbur said. "Most of them work on the basis for reimbursement to their members. If your car breaks down, you have to find the towing service and then they'll reimburse you.
"The single distinguishing characteristic of the AAA is our contract garages," he added. "You put in a call to us and you'll get a response."
The AAA's 16,000 contract garages and service stations will tow your car, fix your flat tire, recharge your car's battery and provide other emergency services and then wait to get paid later by the AAA, Wilbur explained. So, the bewildered consumer stuck on the Pennsylvania Turnpike at 3 a.m. doesn't have to shell out for the tow and related services on the spot.
That isn't the case for many of the competing auto clubs, which reimburse members after they have submitted a bill for the emergency tow. But some AAA competitors, such as Montgomery Ward and Allstate, maintain that this is actually better for the customer.
Alice Patenaude, spokeswoman for Montgomery Ward Auto Club, says Ward's policy allows customers to choose to have their car towed and repaired by whatever garage they want, not just one under contract with the AAA. The fact that Montgomery Ward members will pay for the tow on the spot "puts our members in a priority position," she said.
Yet, as critics and supporters alike would quickly agree, the AAA is an institutional force that transcends a mere listing of services to its members.
Founded in 1902, when nine small auto clubs in northern and midwestern states (with a combined membership of 1,500 drivers) gathered in Chicago to form a national organization, the group spent its early years combatting popular prejudices against the newfangled "horseless carriages" then starting to appear on American roadways.
It wasn't the easiest of transition periods. According to one published report, the early AAA had to overcome local anti-auto ordinances, such as one that required a motorist, when approaching a turn, to stop 100 yards away, toot the horn, ring a bell, fire a revolver, and send up three bombs at five-minute intervals. Another town decreed that if a horse refused to pass an automobile, the driver had to "take the machine apart as quickly as possible and conceal the parts in the grass."
Once such obstacles were overcome, the AAA lobbied aggressively for the construction of roads and roadways -- a battle that culminated in 1956 with President Dwight D. Eisenhower's signing of federal legislation that created the national interstate highway system.
But with the rise of consumer activism in the 1960s and 1970s, and new questions raised about the safety of American automobiles, the AAA found its own credentials as a consumer organization called into question.
In addition, the Arab oil embargo and the accompanying rise in gas prices during the 1970s raised doubts about the future of the auto in American life. The AAA found itself fighting in Congress and state legislatures to fend off raids on the highway trust fund and highway user taxes by mass transit promoters.
But as he reviews these battles today, Creal believes the AAA and the automobile have regained the upper hand. The gas lines have gone away, gas prices have come down and, as the AAA sees it, the right to drive has returned to its proper place in the pantheon of American liberties.
"Most people are absolutely dependent on the automobile," Creal said. "Freedom of mobility is as precious to Americans as freedom of speech."