Jodie Teuton, vice president of Kenworth of Louisiana, talks about how issues facing truck dealers are impacting fleets as well as shares her thoughts on the challenges dealers face today. Kenworth of Louisiana is a full-service dealership with seven locations throughout Louisiana. The dealership sells and services Kenworth and Hino trucks.
HDT: The American Truck Dealers has been actively working to get the Federal Excise Tax on trucks repealed. How will the repeal affect fleets?
Teuton: It would roll back the high price of a truck. When we talk about tax reform in this country, we think that the time is right to repeal FET. The $12,000 to $22,000 FET adds to the purchase price of a new truck is egregious in my opinion. If you know anything about excise tax, you know that it is loosely called a sin tax. Tell me what is sinful about trucks? We have excise tax on alcohol and those kinds of things. The FET on trucks was enacted during WWI to help fund the war.
We keep talking about the need to have clean trucks on the road. We are all for clean air. The earth is a closed system and we must take care of it. But the way to keep the air clean is to get trucks off the road that are not clean. To do this, we need to put new trucks on the road.
Fleets, like any other business, have to stay in the black to keep going. Yet the cost of the trucks keeps going up and up. How much can the customer bear? FET is a disincentive for fleets to buy cleaner trucks.
Trucking has given. It is time for us to get a break. Trucking as a whole is paying a whole lot more than our fair share. As an industry we don’t expect anybody to carry our load, but FET is regressive, cumbersome, unfair and antiquated.
HDT: Do you have any ideas on how we should fund the Highway Trust Fund?
Teuton: What is the answer to funding the federal Highway Trust Fund? I don’t know. There are a lot of conversations going on in our industry about how we fund roads. And something definitely has to give. Trucking pays more for roads, and I can’t speak for the whole industry, but I think that fleets would be willing to kick in more if it went to roads, in spite of the fact that federal emissions mandates have made trucks significantly more expensive to own, and operate. Maybe an increase in fuel tax might be the answer.
HDT: Talk a little about the markets you serve.
Teuton: Our market is a little different, especially down south because that is a mostly a vocational market. A lot of Louisiana depends on the oil field economy. We do some over the road business in Baton Rouge and Shreveport because of proximity to the interstate.
HDT: Do you see a difference in what over-the-road customers want and what vocational customers want?
Teuton: Everybody is hauling some kind of load so there are not a lot of differences. But the vocational market can be severe service so the repairs can be more involved. The truck is working harder. The repair can take more time. You need good parts availability to keep the repair moving forward. Also, you need a correct and fast diagnosis. Speed in the process is important especially to fleets, but it does no good if the repair is not done correctly. It is about accuracy, getting it right and not having comebacks.
HDT: How do you ensure that diagnoses are both fast and accurate?
Teuton: We have seven master technicians, which is the highest level that you can achieve with Kenworth. They are fully certified on everything. The training is extensive; engine, electronic, chassis, HVAC and alternative fuel. They are Cummins and MX engine certified too. It is also about staffing and giving the right job to the right person. A shop manager needs to understand the skills of their people and put the right person on the right job. Admittedly it is all challenging. Most customers are telling us they have a load that has to go and they want get in and out of the shop. We are managing everybody’s crisis. We get that. Doing it successfully is about communicating, staffing and being honest with people. People don’t want to hear, “I can’t get to it.” The reality is sometimes there is not a tech available to get the work done. But you try to find a way. Triage is essential. Let the customer know where they stand so they can make an informed decision.
HDT: Talk about some of the people challenges you face?
Teuton: You have heard it time and time again, and that is technicians. Everyone is challenged by that. We are looking at every avenue including going to high schools and talking about the benefits of being a diesel technician. Being a technician is a good high paying job. It may not seem glamourous but my dad started out as a diesel mechanic. You have to get the message of opportunity out.
We are recruiting technicians every single day. It never ends. Every dealership in this country struggles every day in keeping staff in their shops. I looked at some statistics a few months ago and I saw that in the national economy there are about 250,000 diesel technicians and about 1.2 million lawyers. This obviously is not a good thing.
It takes experience. You cannot take a person straight out of school and have them handle a major job. They need experience. It is just not a job where you can just say, “I read the book I am ready to go to work.” It does not happen that way. You have to grow your people. You have to mentor.
HDT: What are you doing to keep your technicians trained?
Teuton: The training is never ending. There are schools that techs have to travel to all over the country. There is online training. When Kenworth or Hino schedules classes we have to make sure to get spots for our people. It has to work around schedules and yet the bigger challenge is staffing. When you have a technician out for a week at school, he isn’t in his bay taking care of customer trucks. You just keep moving forward. You handle each moving piece as it comes at you. It is costly too not just in terms of the fees and expenses but also the lost revenue. Every dealer in this country is spending a lot of money to keeping technicians trained. I can say having been in the business for a long time that it is much more costly to keep up with technician training than in years past. And your return on investment is hopefully customer satisfaction and the repeat business that results from that.
HDT: Let’s switch gears a little bit. Tell me how you became a truck dealer.
Teuton: I went to a local university for a business degree and law school thereafter. I practiced law for a few years. Getting a law degree was certainly worthwhile and is a useful education but I don’t think the practice of law is personally fulfilling. Once I came to that realization, I looked for something else. Going into the family business seemed the obvious choice so I went to work for my dad and uncle at their dealership. They both wanted to teach me about the business. I learned operations from my uncle and sales from my dad. There was a time that I thought I was going to stay on the car side with my uncle. But duty called when the brothers divided up their interests and I went to work with my dad on the truck side. It did not take long to see the potential in our business, but my father’s strong personality was challenging so I asked my husband, also a lawyer to join me in the business wanting to grow it. He left the practice of law, came to work with us. We quickly started looking for our own brand and signed with Kenworth in 2004. In 2005 Katrina hit. That tested our mettle. But if there was anything good about that storm for us it was that we sold a lot of trucks and got a lot of customers back up and running. Our growth did not stop. Today we have the Kenworth franchise for the state of Louisiana and the Hino franchise for the greater Baton Rouge area.
HDT: As a woman who has been in the business for a few years, what advice would you give to young women about the opportunities for them in the trucking industry?
Teuton: It touches everything. It is real. It is rewarding. You can see the product of your work. The pay is good. It is more welcoming than women might think. Perhaps there is a preconceived idea that might cause women to hesitate about why they should consider it. Women should know that it is open and welcoming and that we have a lot to offer this industry, even as technicians, because we are problem solvers.
It gives you an opportunity to accomplish something every day. In this business when you go home at the end of the day you feel like you got something good done. These is a sense of satisfaction and that you are doing something significant.