Johnnie: Welcome to The Dig, where Equipment Finance News editors connect with industry leaders and dealers to discuss news analysis, market trends, tips, and more. I am Johnnie Martinez II, Senior Associate Editor of Equipment Finance News, the one news source for both dealers and lenders.
Johnnie: At this time, I'd like to introduce today's guest, Greg Arscott, president of Peterbilt Dealer the Pete Store. What is the Pete's Store and what area of coverage do you guys have at your dealership?
Greg: All right, so we are – we have 30 locations, and those locations go from Miami in Florida up to Boston, Massachusetts.
Johnnie: Gotcha, okay, and so with the main topic of the conversation being around the hurricanes, you are all up and down the coast.
Greg: Yeah. We had a unique perspective. We were hit multiple stores in different ways. With – to your point, with the – both Hurricane Helene and Hurricane Milton impacting your stores, differently, I guess for starters, how did you guys prepare for the hurricane season, just to try to get your story as wide as possible? Yeah, well, we have six locations in Florida, and unfortunately, we're pretty good at responding to hurricanes because it seems like, once or twice a year we're being impacted some years even more in really active seasons.
So we get the opportunity to run those bases quite frequently. So what we – I mean, what we've done is we have generators that are on standby. We store them at a central location, and we will – and we have pallets of water and food supplies that we keep stationed in a central location. And so then when we have an issue – we also have, like, things like window air conditioning units, right, so for employees – because generally what happens is we have generators at all of our locations. So we have power at our store, but it's our employees that are impacted generally the most, right, because the residential grid takes longer to get up. And in the case of Haleen, where it took down a lot of trees, what we saw is the commercial areas that didn't have a lot of trees, those areas weren't as impacted, but the residential areas with lots of trees down took out large parts of South Carolina and North Carolina power grids.
So what I was going to say is what we do is when we have a storm coming, obviously you get pretty good warning, and we will pre-position support supplies in wherever the idea wherever the biggest impact will be. And in that way we're already in place with generators, fuel, water, and are able to respond quickly.
Johnnie: To your point, right, with hurricanes compared to other natural disasters, you do have a pretty decent warning what's coming. You may not know the severity, but we're in the general path of this hurricane. We may want to start preparing.
Greg: Exactly. Yeah
Johnnie: Since then we're a few weeks removed from all this now. How has the response been? How has your dealerships kind of come out of this on the back end?
Greg: Well, I mean, we were fortunate. Our dealerships were largely untouched, aside from losing some power on a couple of downed trees here and there, not a significant impact. I think the impacts really were felt with our employees and friends and family, and then just the communities that we work in and serve on a broader scale.
So once we figured out that we were okay, the dealership had power or had backup, was on backup power, and there was no damage, then you quickly shift your focus to, okay, well, let's make sure our employees are taken care of, friends, families, customers, what we can do to support there. So that's really been the lion's share of our response has been really helping other people because, our dealerships, we were lucky there.
Johnnie: And to your point about the communities, how or what role have you guys and maybe other equipment dealers in the area sort of played in the response to the hurricanes in your communities? Well, obviously, your employees, but even beyond that?
Greg: Well, I think the most meaningful was or has been is our relationship with a non-profit that we've had going back almost 20 years, and it's a non-profit called the First Response Team of America, and they are really – it's a really unique non-profit. So it was founded by a guy named Tad Agoglia – I can get you that spelling – and he was a government contractor, and I guess it was right around Katrina, he was a successful government contractor, showed up a few weeks late to see all the devastation and just felt this profound sense of guilt over the fact that he knew that he should have been there sooner and he could have actually helped people instead of just cleaning things up.
So he changed his business model and became a non-profit disaster response unit, self-funded and with the goal of showing up to natural disasters in the first kind of few hours or before, even in some cases, a natural disaster struck. And the nice thing about that is we have trucks, and he needed trucks. So our role with him has been to supply Peterbilt trucks so that he could haul his equipment and then – and also some – helping to fund some of his ongoing expenses and operations.
So when this happened, it's one of those things that it seems like these disasters happen far away until they happen in your backyard. So I called Tad and said, Tad, Western North Carolina, we have a dealership we're building right now in Asheville, but we don't necessarily have a – we don't have a dealership there yet. In talking to friends and customers and obviously seeing in the media some of the devastation, it was pretty clear that's where he had to be.
So in working with Tad to dispatch his equipment, and then we had a customer in the area that was gracious enough to let him stage his equipment in Asheville at his facility that he responded within a couple days of the storm hitting. And the unique thing with someone like that is that they have specialized equipment that most don't, right? So like he had a Peterbilt grapple truck where he could take trees off of homes or move fallen objects, things – clear roadways, things like that.
He's got skid steers and big chainsaws, things like that that you just – most people just don't have. And he coupled that with the experience that he has of disaster – of managing a – the wake of a disaster and the uncertainty, the lack of communication, the lack of fuel that goes along with that. That can be very jarring for people. He does that all the time, right? So he's kind of the calm in the storm.
And so that's a pretty unique opportunity for us to work with someone like that. And to go one step further, because, we've got these – we have 325 technicians, service technicians that are across the country, and they're all very skilled at fixing trucks, but they're also very skilled at fixing things and working with their hands. So what we do is, when we have a – when TAB responds to a disaster that's in the region of one of our locations, we'll put a alert out to all of our employees and say, hey, this is the response, this is where it's going to be, and here are the skills that we need.
You need to have a CDL, you need to be able to run a chainsaw or heavy equipment, you need to be CPR certified, whatever it might be. And it's always amazing the response we get from people who put their hand up and say, well, I'm all of those things, and I'd like to come. And so instead of having people who show up and get in the way, they show up and really can help move the needle. And so we pay, full wages for folks who are volunteering, and that's probably from a charitable standpoint the most impactful thing that we do, certainly, in a disaster situation.
Johnnie: I didn't know that. Sorry, I'm going to choke up here. That's great stuff. Just hearing, part of it, right, understanding, hey, there's an expert in the field that we can work with that can do his part of it, but also we have people on our team that can go out there and, to your point, provide real help, as much as it would be nice to send every person under the Pete Store's employee to every disaster that's difficult to do, and that's hard to manage, but send the people who are experts in some of this stuff and get the most out of it and do the most good.
Greg: Yeah, that's the goal.
Johnnie: Gotcha. And since you guys have been doing this for a while, I'm curious if at this point you've got an understanding of how this hurricane season, obviously a unique one, but how it compares to maybe some of the other ones that you've got to deal with.
Greg: Well, I think what we've seen, I mean, as I said, with a presence in Florida, we see hurricanes quite often, and the impact, the flooding and the storm surge and things like that.
With unique periods, I think the impact inland was much more significant than certainly I've ever experienced. So you have parts of Georgia and South Carolina and, of course, North Carolina that experienced 15 to 20 inches of rain, 70-mile-an-hour winds in a 24-hour period, and you have all these big oak trees and pine trees that have never seen that kind of wind before, or certainly not that with a combination of the rain. So what happened is all these enormous 80, 100-year-old oak trees started laying down all over the place and completely crippled the data and the power grid across large parts of the southeast.
And I think that's unique because that's just not you don't get hit inland that hard by a hurricane. So people were completely caught off guard, and it made it a much longer recovery where you've got people who are without power for weeks, some still without power taking out water supplies in cities. Asheville is still rebuilding their water infrastructure. And then you have, with all that rain in such a short period of time, the flooding that happened, particularly in western North Carolina where it's one thing.
If you get 10 inches of rain in Florida, Florida is pretty flat, and it spreads out all over all over the place. And when you get 10 inches of rain in the mountains, it feels like 30 because it all funnels into valleys. So the French Broad River and tributaries around it swelled to levels never seen before. The largest, I think the record of 1916 is when the highest level the French Broad ever got to.
This storm was 10 feet plus above the all-time record in 1916. So you can just imagine the devastation of a 10-foot wall of water that comes out of nowhere. Both loss of life and loss of properties I don't think has been fully appreciated and understood yet and will be years to recover from it.
Johnnie: To your point, right, from a just pure recovery standpoint, we're talking about years. I'm curious how much of that are you seeing translated into the, obviously you guys are a truck dealer, but the equipment space as a whole. How much maybe is it going to take for the industry to kind of normalize after this because there's so much demand for this equipment following these storms. And as recovery goes, equipment trucks are needed.
Greg: Sure. Well, generally what happens in the wake of a storm is that things actually get pretty quiet because everybody's running everything they've got as much as they possibly can. And then things start to get busier in the weeks to follow as trucks and equipment needs service, or in the field they get broken or damaged or whatever it might be.
But for my part, I think that we will see demand. I mean, we already have a high demand for equipment because of all the infrastructure spending, right? The average bridge in America is over 65 years old. And when you pull that across the country, there's demand for heavy equipment and vocational trucks, cement trucks, dump trucks, things of that nature was already high. And then you take the devastation of these hurricanes overlaid there, and I think it will be significant demand for years, certainly as far as I can see out.
Johnnie: That's great insight. And the only other question I would ask for you is given everything that has happened, is there any other information or pieces of advice you would share with other equipment dealers about hurricane response or really just any natural disasters and how to manage those situations?
Greg: I don't know if there's anything more sage advice I can offer other than being prepared. but that's obvious.
Johnnie: I mean, I feel like it's one of those things where everything is obvious until you're in the heat of the moment, and then it's so easy to panic and to adjust.
Greg: Yeah, it's one of those things. It doesn't matter until it's the only thing that matters, right? It's like to have backup power, communications. I mean, we spend a lot of time thinking about what our response plan and recovery plan is for data and power. Because for us, I look at it and say there's the selfish side of it is, hey, we're a for-profit business and we want to stay open. But the extension of that is we have customers who run trucks that are critical to the infrastructure and backbone of America, and if we're closed and those trucks have an issue, then it starts impacting much bigger things than the bottom line.
So I think our team feels a responsibility to stay open as much as we possibly can and support our customers because they play a very important role, and our role is to support them.
Johnnie: All right. Well, thank you so much.
Johnnie: Thank you for joining us for The Dig, where we aim to take the industry and you to better results. This podcast is a production of Equipment Finance News. Visit EquipmentFinanceNews.com to learn more about our lender directory and about our annual event, Equipment Finance Connect. Equipment Finance Connect is where lenders and dealers come together to network and connect around financing opportunities. We hope you will join us for next month's episode of The Dig.
