Frank Lutz of Desert Car Care joins CarEdge Live for a wide-ranging look at why repair bills keep climbing. The conversation moves from choosing a trustworthy mechanic and building relationships before you need service, to CPI data, right-to-repair concerns, and the complexity of modern networked vehicles. A big theme is labor: technician shortages, flat-rate pay, training costs, and how those pressures flow into higher invoices for consumers.
Today on CarEdge Live, Ray and Zach are joined by Frank Leutz of WrenchNationTV. Tune in to learn more! Hosted by Simplecast, an AdsWizz company. See https://pcm.adswizz.com
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"“the right to repair is a big thing in Massachusetts.” ... “consumers should have the right, they own it, to A, take the car where they want to fix it, including under the warranty period”"
Right to repair means car owners should be able to choose where to get their car fixed. It also means independent shops should be able to get the information and tools they need, not just the dealership.
“Right to repair” is the idea that vehicle owners and independent repair shops should be able to diagnose and fix cars using the same information and tools as the manufacturer. It’s often tied to access to software/diagnostic data and the ability to service vehicles even while they’re still under warranty.
"“including under the warranty period that's known as the Magnus Moss Act that gives legal right.”"
The Magnuson–Moss Act is a U.S. law that helps protect your warranty. It generally prevents a carmaker from voiding your warranty just because you used an independent shop.
The Magnuson–Moss Warranty Act is a U.S. law that restricts how warranties can be enforced. In practice, it supports the idea that a manufacturer can’t automatically deny warranty coverage just because the work was done by an independent shop using non-OEM parts.
Term
lab scope training
"“...anywhere from $3,000 to $5,000 per session to send my staff to lab scope training, controlled area networks.”"
A “scope” is a tool that lets a technician see electrical signals. Training on it helps mechanics troubleshoot modern cars’ electronics when warning lights or codes aren’t enough.
“Lab scope training” refers to hands-on instruction using an oscilloscope (often “scope”) to analyze electrical signals. As cars add more sensors, actuators, and networked electronics, technicians increasingly need lab-style training to interpret signal waveforms and diagnose faults.
Term
controlled area networks
"“...$3,000 to $5,000 per session to send my staff to lab scope training, controlled area networks.”"
Modern cars use multiple electronic control units that communicate over internal vehicle networks. “Controlled area networks” here refers to training for working with those in-car communication systems (often including diagnostic and data-bus networks) so technicians can troubleshoot today’s software-heavy vehicles.
"“...I joke around. Look, that new, well, I don't know if it's still around. Ford had a tough time with the lightning, but that lightning has got 100 million lines of code.”"
The Ford Lightning is an electric truck. The point here is that EVs rely heavily on software, so fixing them can require more advanced tech knowledge than older cars.
The Ford Lightning is an electric pickup, and the speaker is using it as an example of how EVs can be software-intensive. They mention it having “100 million lines of code,” highlighting how modern EVs can require more specialized diagnostics and training.
Concept
networked vehicle systems
"Because now I'm going to tell you that your right side mirror has something to do with network. [614.0s] It's a node and so on."
The idea is that the car’s electronics talk to each other. So when you change or repair one thing, it can affect other systems because they’re connected.
The segment connects the right side mirror to the car’s network, highlighting that many vehicle functions are controlled by interconnected electronics. When systems share a network, repairs and security can involve multiple modules rather than a single isolated part.
"Because now I'm going to tell you that your right side mirror has something to do with network. [614.0s] It's a node and so on."
A "node" is basically an electronic component in the car that can send and receive information. Think of it like a device on the car’s internal communication network.
In modern cars, a "node" is a connected electronic module (like a control unit) on the vehicle network. Multiple nodes communicate over shared wiring so systems like mirrors, infotainment, and engine controls can coordinate.
Company
National Automotive Service Task Force
"And then absolutely, a little deeper is NASDAF, [625.4s] the National Automotive Service Task Force, [628.9s] which is a self-governed body that allows us to play ball with the OE."
This is an organization that helps set the rules for how shops can work with car manufacturers. The goal is to make repairs possible while keeping things secure and authorized.
The National Automotive Service Task Force is described here as a self-governed body that coordinates how independent repair businesses can work with original equipment manufacturers (OEMs). The key idea is that it helps set rules/relationships so repairs and parts access can happen within agreed boundaries.
Term
OE
"which is a self-governed body that allows us to play ball with the OE. [633.9s] So for example, Mercedes says,"
"OE" means the original manufacturer. It’s the same company that built the car and its systems, not an aftermarket brand.
In automotive repair discussions, "OE" usually means original equipment—i.e., the manufacturer’s parts and systems. The speaker is implying that service access and compatibility depend on how independent shops interact with the original equipment ecosystem.
"So for example, Mercedes says, [633.9s] if you're going to put anything ignition related or even a transmission control module, it's not plug and play."
"Plug and play" means you can swap something in and it just works. The point here is that some car electronics need extra setup before they’ll work properly.
"Plug and play" means a part can be installed and used immediately without additional setup. In cars, many modules (like transmission control modules) may require programming, authorization, or security steps before they’ll function correctly.
"Mercedes says, [635.4s] if you're going to put anything ignition related or even a transmission control module, it's not plug and play."
A transmission control module (TCM) is the car’s computer that manages how the transmission shifts and behaves. When a TCM is replaced, it often needs to be configured to the specific vehicle so it can communicate correctly with the rest of the car.
"You need to be, I have to have insurance. [644.5s] I have to be bonded."
They’re saying you may need insurance to be allowed to do certain types of repairs. It’s basically proof you can cover mistakes or damage.
Here, "insurance" is referenced as a requirement for authorized access or compliance when dealing with certain vehicle systems or repairs. In practice, it’s often part of the risk-management and legal requirements that allow shops to handle sensitive repairs.
Term
bonded
"I have to be bonded. [645.6s] In fact, guys, they just announced, the feds just announced this big sting."
Being bonded means there’s financial protection if a shop doesn’t do what it promised. It’s like extra security for customers.
Being "bonded" means a surety bond is in place to protect customers if the business fails to meet contractual or legal obligations. In the context of authorized automotive service, it’s another compliance requirement tied to trust and accountability.
Term
device
"And folks can easily break into your car with a device. [658.5s] Well, it's not that easy, but we have to have the training"
They’re talking about a tool that could be used to mess with or access the car. The concern is that modern cars have computers that can be targeted.
The speaker is using "device" in a cybersecurity sense—referring to tools that could be used to access or interfere with a vehicle. This ties into modern cars’ networked electronics, where unauthorized access can be possible if security and authorization controls are weak.
Concept
repair and maintenance cost inflation vs parts inflation
"because we have data on motor vehicle parts and equipment have only gone up 27% since January 2020, [674.9s] whereas the repair and maintenance costs have gone up over 50%."
They’re comparing two kinds of price increases: parts costs versus what it costs to get the car repaired. The takeaway is that the repair process (like labor and extra steps) may be getting more expensive.
The speaker contrasts how motor vehicle parts and equipment prices rose versus how repair and maintenance costs rose. This suggests labor, diagnostics, and compliance/authorization steps can drive bills up even when parts themselves don’t increase as much.
"It's long gone to where, you know, in fact, a lot of technicians have left the industry because not only are they not appreciated with bad culture, but they're not being paid."
Technicians are the mechanics who do the diagnosing and repairs. If there aren’t enough of them or they’re paid more, repair costs can rise.
Technicians are the trained automotive workers who diagnose and repair vehicles. In the context of rising repair bills, staffing levels and technician pay can directly affect shop capacity and pricing.
"So where do we meet halfway? I've had to raise my labor rate, unfortunately. Now I've got to provide the value behind that."
Labor rate is what a repair shop charges for the mechanic’s time. If it goes up, the same repair can cost more even if parts prices stay the same.
A labor rate is the hourly (or per-job) charge a shop sets for technician time. When repair bills rise, labor rate increases are one of the levers shops use to cover higher wages and overhead.
"I've got to provide the value behind that. I've got to have transportation ready. I've got to have a strong impactful warranty."
A warranty here means the shop stands behind the work they did. If the same issue comes back within a certain period, they’ll usually fix it again.
In auto repair, a warranty is the shop’s promise to fix (or cover the cost of fixing) certain problems if they reappear within a stated time or mileage window. Shops often strengthen warranty terms to stay competitive, but that can increase their risk and cost.
"we had a direction, we knew what was broken. Now, the testing time is so intense, it could be an hour."
They’re talking about how long it takes to figure out what’s wrong. In the past it might have been quick, but now it can take an hour because the car’s systems are more complex.
The hosts are contrasting older repair workflows—where the broken part could be identified quickly—with modern diagnostic testing that can take much longer. This reflects how today’s vehicles often require more time-consuming checks to isolate faults.
"the fact is it is intense to test these vehicles and get the x-ray right. If that's not done right, everyone suffers and fails, and then it's a hodgepodge."
They’re using “x-ray” to mean the shop’s diagnostic process—figuring out exactly what’s wrong. If that step is done poorly, the repair process turns into guesswork.
In this context, “x-ray” is a metaphor for diagnostic imaging/inspection used to pinpoint what’s broken. It’s describing the need for accurate diagnostics before repairs can be done efficiently.
Concept
qualified labor
"So you're going to have to pay for that qualified. Zach, you had mentioned that there was a slide"
They mean the work needs a skilled technician, not just someone doing quick tasks. If the job requires expertise, it costs more.
“Qualified” here implies labor that requires specific training/skill to diagnose and repair complex systems correctly. The point is that when diagnostics take longer and require expertise, labor costs rise.
"the quick drive-through elements of our service handling commodities such as air filters, cabin filters, oil services, that is a low-level entry level"
Cabin filters clean the air that comes into the car’s heating and A/C system. If they’re dirty, the airflow can feel weak and the air can smell worse.
Cabin filters are air filters inside the vehicle that clean the air entering the HVAC system for the driver and passengers. They’re commonly serviced because clogged filters reduce airflow and can worsen odor and air quality.
"the quick drive-through elements of our service handling commodities such as air filters, cabin filters, oil services, that is a low-level entry level"
Oil service is the routine maintenance where the shop changes the engine oil (and usually the oil filter). It’s a common, straightforward job compared with diagnosing a complicated problem.
Oil service is the scheduled maintenance work centered on changing engine oil and often the oil filter. It’s mentioned here as a “commodity” service—something many shops can do quickly compared with deeper diagnostics.
"Can you explain to the audience what the flat rate system is? Absolutely. So the flat rate system essentially says, if we pay a technician $30 per flat rate hour..."
In a flat rate system, the shop pays the mechanic a fixed amount of time for each repair. If the mechanic finishes faster, they can earn more; if it takes longer, they still get paid the same.
A flat rate system is a pay structure where technicians are paid a preset number of hours for each repair job, regardless of how long it actually takes. The goal is to standardize labor times, but it can also incentivize rushing to finish within the allotted time.
"If a break repair by a guide, a labor guide, and it's just a guy says, hey, we'll pay you an hour to do front breaks, pads, rotors, hardware."
A labor guide is like a rulebook that says how long a repair is supposed to take. The shop uses it to decide how much labor time—and pay—you get for that job.
A labor guide is the reference that lists standardized repair times for specific jobs (like front brakes, pads, rotors, and hardware). In a flat rate system, these guides determine how many “flat rate hours” a technician is paid for each task.
"Because that same technician will have to pull an evaporator or heater core and pull a dash."
The heater core is what uses heat from the engine to warm the air that comes into the cabin. Getting to it can require taking apart a lot of the dashboard area.
The heater core is the HVAC component that transfers engine heat into the cabin to provide warm air. Repairs can be labor-intensive because the dash and related parts may need to be removed to access it.
"Because that same technician will have to pull an evaporator or heater core and pull a dash."
The evaporator is part of the car’s air-conditioning system that helps cool the air inside the cabin. Fixing it usually takes more work than basic repairs.
In an HVAC system, the evaporator is the part that absorbs heat from the cabin air so the air conditioning can cool it. Accessing it often requires significant disassembly, which is why it can take longer than simpler jobs like brake work.
"Because that same technician will have to pull an evaporator or heater core and pull a dash."
The dash is the dashboard inside the car. Some air-conditioning and heating repairs require taking it apart to reach the parts behind it.
“Dash” refers to the dashboard area inside the cabin. Many HVAC repairs require removing or partially disassembling the dash because components like the evaporator and heater core are located behind it.
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It's noon here in Ventner City, New Jersey,
and our nation's capital, Washington DC.
And this is Car Edge Live for Wednesday, May 6th
with your hosts, me, Ray, here in my living room in Ventner
and Zach hanging out somewhere in Washington DC.
How are you today, handsome?
I'm doing pretty good.
I'm excited to be here for another episode of Car Edge Live.
We've got another special guest joining us
in just a moment here.
So look at us, Dad.
Back-to-back guests that are going to make this show
10 times better than it usually is.
A friendly reminder that today's show
is brought to you by CarEdge.com.
So if you're in the market to buy a car,
sell a car, protect a car, all car-related things,
please, me and my dad and our incredible team
for the past six years, can't believe it's been six years,
have been building CarEdge.com to help you.
You can click on the link down below
or just go to CarEdge.com to learn more.
Dad, what do you think?
We bring in our special guest for a very interesting show.
I like this, yes, yes.
All right, here he comes.
It says, what's that shirt say?
Hug the mechanic.
The aquatic.
We've got Frank Lutz here from Desert Car Care,
joined us, and he wants to remind you
to hug your local mechanic.
Frank, thanks so much for taking the time to join us.
It's an honor to join you guys.
The Chef could try, but CarEdge, you guys rock,
and this is exciting.
We get to talk about cars.
This is where we live and breathe,
and hopefully make sense of the madness
that is our industry.
I want to hand it off to you in a second pause,
but before I do, there's a link to Wrench Nation
down below in the description as well.
This is Grace.
And he's got, he's a busy man, so we got to be very clear.
He's like the time out of his day to help us.
Frank's got Wrench Nation, check out Wrench Nation.
We're going to learn more about his show here on our show today,
but Dad, I'll hand it off to you first for our first question.
Frank, I know you think we should all hug a mechanic,
but how do we know which mechanic to hug?
How do you find a good independent mechanic?
Yeah, well, I like to joke around if they smell good
and they can speak correct sentences.
That's a good start.
I'm just kidding.
Actually, one of the greatest ways
is around the water cooler at work, right?
You know, I mean, a lot of our good business,
and I think I speak to you, whether it be the aftermarket
or dealerships, you know, you're going to kind of snoop around.
How was your experience?
Some of our great clients come from referrals,
which we invite, right?
The other way is, yes, we're going to look,
reviews have been online forever in a day.
In fact, I was just talking to somebody.
It seems like if you've got a Yelp rating,
three and a half is really good because so there's many ways
to go about it.
But lastly, I would say we got, I've been telling folks for years,
is to actually date the mechanic before you need them, right?
Even if you're going into a dealership,
what's the service drive experience going to be like,
as well as any other aftermarket shop, you know?
So test drive before you usually need to spend some money.
Makes sense.
One of the things I wanted to spend time with you today, Frank,
on and to be clear here for our community,
let's actually take a second,
do a bit more of an introduction on your background,
your professional expertise,
because we frequently have people who work at car dealerships
or who sell cars on the channel.
We infrequently have folks like yourself
who have been master mechanics and on committees
and things like that and opening independent repair shops.
So take a second to share a little bit more
of your background for our community.
And then I got a question around the cost of owning a vehicle
and repair bills exploding in costs.
But first, a little bit more context
so that everyone knows how to trust you here on the show today.
Yeah, you said pill, yeah.
And bill, sometimes we need a pill for the bill.
Car repair has gotten expensive, no doubt.
We'll talk about that.
But, you know, I started the industry.
I got out of the military and did my time.
I was in San Diego, wonderful time.
In fact, I did Persian Gulf,
streamed their Hormuz streets there way back in the 80s.
And fast forwarded, met my future wife at the time in 89.90
and started as a mechanic with my father-in-law.
And I really didn't want to get my nails dirty.
I was gonna go back to New York
and just be a broke trombone player.
I'd played quite a bit of music professionally.
And fast forward worked for a great dealership.
This is before the big takeovers and such.
And they had transferred me two years into it
to another dealer.
It was bought out by a big group.
And they didn't transfer me, they fired me.
So my wife, who's just amazing,
kudos to all our great spouses that just keep us straight.
She says, you know, I was really,
I'd be like, honey, I'm out of here.
I'm done with this automotive thing.
I'm going to go be a broke trombone player in Cuba.
But so in any event, she said, honey,
let's open up our own place.
And in 1995, it went into business with a broken jack,
a fishing tackle box for tools
and sort of the entrepreneurial spirit, you know,
and fast forward.
I've had five locations and do a lot of industry work.
We have the Desert Car Care brand.
We brought our first commercial property,
which is a big deal.
Do a lot of industry work.
I've worked with Honeywell, Chevron,
all the local media I'm honored.
I've worked with ABC and now I'm working with CBS.
And it's really cool.
And then we do the Wrench Nation show.
We've been podcasting for 10 years.
It's an educational format.
We've had guests on like Craig Jackson,
guests from all over the world
and the world famous Mr. Ray Shevska.
You guys are amazing.
So that's the story.
I'm very passionate.
You know, we're a small business of the year.
Best places to work by Phoenix Business Journal.
I really believe in the humanity of what we do.
While still honoring metrics is very important to a business.
Love it, Frank.
So I just want to be very clear for our community.
We couldn't have a more qualified person
to talk about what it takes to repair a vehicle,
own a vehicle, et cetera.
And so, Frank, I've got a question that I want to ask
and it starts here.
This chart shows the CPI motor vehicle maintenance
and repair price level since 2017.
This is essentially how much does it cost
to maintain and repair a car in the United States of America?
And this chart has gone up significantly.
What are you seeing in your business with your customers?
And I'm also going to end up asking you a question here.
Maybe a little bit down the line.
I'll tease it for a second here.
Independent versus going to the dealership.
Am I spending more at the dealership
or less at the dealership, more at the independent shop,
less at the independent shop?
But we'll start macro.
This chart shows the cost of maintenance and repairs.
Are you seeing this in your day to day with your customers?
It is absolutely such an expense for the consumer.
And yes, this does correlate to what we're seeing across the board,
whether it's the independence or the after markets.
And I don't have a theory more so
than that there are concrete studies.
And what we're, as an entrepreneur, as an operator,
as an automotive shop owner, what I'm experiencing as to the why,
because I think the why is important.
Absolutely.
Since COVID, all hell broke loose.
I have the light sage to present a battery.
Batteries have gotten through the roof.
And we've just seen the increase for the consumer.
It is a double-edged sword, though, and some may argue this point.
But if you did the cost per mile, which I think is about 9 cents,
it is still less expensive to invest in what you got.
Now, some would say, well, Frank, where do I pull the plug?
The misnomer, since we're talking about these elevated costs,
is, well, my car isn't worth it.
And I think you all agree it's really down to, OK, what are my options?
Do I buy another used Hooptie that's
going to cost me that much more in service and repairs to catch up?
Or do I get into that whole yearly cost of buying a new or slightly used vehicle?
There are benefits across the board, but we absolutely have seen prices go up.
But the phenomenon behind that, which is quite frankly a good thing for us,
because we're busy, is that folks are keeping their cars.
Because prices are just, do I spend over here for the new car price?
Or do I invest what I got?
So that's where we're at.
Frank, do you have an issue when it comes to taking care of people's cars
with the proprietary issues from the manufacturers, the special tools,
not being able to necessarily access all the codes and everything else,
the right to repair is a big thing in Massachusetts.
I don't know if it's a big thing in Arizona at the moment or not,
but do you find any difficulty with that?
Yeah, so I've spent time in DC.
I actually was on the National Ops Committee for the Automotive Service Association years ago.
We had a lobbyist and right to repair not only in the automotive sector,
but our farmers that are buying expensive tractors and combines,
they want to be able to fix these things.
I do not see an issue yet.
I also like to shout out for Auto Care Association, who does an amazing job
lobbying our position that consumers should have the right, they own it,
to A, take the car where they want to fix it, including under the warranty period
that's known as the Magnus Moss Act that gives legal right.
What I am seeing is I'm seeing an uptick
where I have to spend anywhere from $3,000 to $5,000 per session
to send my staff to lab scope training, controlled area networks.
I mean, I joke around.
Look, that new, well, I don't know if it's still around.
Ford had a tough time with the lightning,
but that lightning has got 100 million lines of code.
You know, we went from greaseball mechanics to automotive technicians.
You now need to call me a network engineer.
Because now I'm going to tell you that your right side mirror
has something to do with network.
It's a node and so on.
So the training level is the investment.
And then absolutely, a little deeper is NASDAF,
the National Automotive Service Task Force,
which is a self-governed body that allows us to play ball with the OE.
So for example, Mercedes says,
if you're going to put anything ignition related
or even a transmission control module, it's not plug and play.
You need to be, I have to have insurance.
I have to be bonded.
In fact, guys, they just announced, the feds just announced this big sting.
I think it was Jeanine Perot, sorry for getting the name wrong.
And folks can easily break into your car with a device.
Well, it's not that easy, but we have to have the training
as my bottom line on that.
Wow.
You know, it is interesting, and I want to pull up this other chart
because we have data on motor vehicle parts and equipment
have only gone up 27% since January 2020,
whereas the repair and maintenance costs have gone up over 50%.
And I wonder, Frank, if actually what you just shared
is partly why that's the case.
It's not even the parts that have gotten more expensive,
which obviously they have to a degree.
It's all of the human capital increases around
you to get people to be capable of being able to work
on these new, more complicated to your point like computers,
not even cars.
It's just computers at this point that they have to maintain.
Yeah. And to add a little injury is probably the most wasted appliance
that we'll ever have.
We only use it, what, 10% of the time.
You know, before I answer that, I want to take you back.
We had a traffic commissioner, a New York City traffic commissioner
on our show, gridlocked Sam Schwartz.
He came out with a book.
I said, I got to get him on the show.
It said, no one behind the wheel.
He predicts by mid-century, you'd be arrested for driving.
Will our grandkids laugh at us because they don't need to own a car.
They can subscribe to it.
It's autonomous.
But currently, the demand, and there's no hiding this,
is in the extreme shortage.
We've heard Mike Rowe.
I've pitched it for 10 years.
My show's done out of a trade school so we can preach to the parents.
We need technicians.
We're talking inside a half a million.
And so what that supply imbalance has done is, well, it's increased our costs.
I'm very grateful.
I've got master mechanics.
And, you know, they got to make money.
It's long gone to where, you know, in fact, a lot of technicians have left the industry
because not only are they not appreciated with bad culture, but they're not being paid.
So here's a society, if we step out, we all want to get paid our due worth,
but we may be reluctant to pay for that.
So here we are as consumers, and here we are as producers.
As producers, we want to get paid.
And as consumers, we want a great deal.
So there has to be a balance.
And it's a tough swallow for folks to hear this statement, but that's where we're at.
It's a crazy town.
So where do we meet halfway?
I've had to raise my labor rate, unfortunately.
Now I've got to provide the value behind that.
I've got to have transportation ready.
I've got to have a strong impactful warranty.
I've got to be able to organize repairs in a way so it's not all needing that day.
It can be come up, you know, set up on a program.
So that's where we're at.
And the cost, I hope it tapers.
It's expensive.
We talk about it all the time.
It's scary stuff when you think about it.
And it's almost when I was listening to you, Frank, I was thinking,
it's as if we're going to pay people more for their intellect
than for their ability to actually be able to perform and do something with their hands.
And so that if you're willing to get your hands dirty, well,
damn it, we don't have to pay you as much.
And that to me is like stupid thinking.
It's like you have to combine your hands and your intellect
to be able to do what it is that needs to be done to keep cars running today.
So it's almost as if a master mechanic is entitled to get paid more
because they have the ability to both think and work with their hands,
at least in my opinion.
Yeah, 100%.
I will tell you, one of the mantras we have, and this really keeps us grounded,
because it's not a perfect world.
These vehicles are complex.
But one thing that we focus on, generally speaking,
repairing vehicles is fun and can be interesting.
And I'll use the word easy if you have a game plan.
Performing the vital x-ray as to what is broken,
that is the differentiating factor.
In our world, there are technicians that will shoot parts at a vehicle.
And that's not the way to diagnose with the expense of someone's wallet
and quite frankly, the expense of the reputation of the business.
So we're finding, I have witnessed this doing this, gosh, since 1990,
we're finding it used to be within 15, 20 minutes, we had a direction,
we knew what was broken.
Now, the testing time is so intense, it could be an hour.
I work on a lot of European vehicles.
So if we can get that right, and I speak to consumers that are going after retail,
whether they're at the dealership, there are plenty of great dealerships or the aftermarket,
the fact is it is intense to test these vehicles and get the x-ray right.
If that's not done right, everyone suffers and fails, and then it's a hodgepodge.
So you're going to have to pay for that qualified.
Zach, you had mentioned that there was a slide, I thought it interesting.
The fluid services didn't correlate with that.
Is that correct? Did we say that?
Yeah, I think you're right, Frank.
So this is the phenomenon we're seeing.
We're seeing more extremes on capability.
So again, I'm not knocking that business model, but the quick drive-through elements of our
service handling commodities such as air filters, cabin filters, oil services,
that is a low-level entry level with the hope that they come up through the ranks.
But that's a whole different phase, and we just got an increase on oil.
Obviously, stuff's happening in the world, and folks have seen an increase.
But if you're going into the dealership or you're going into any great local community-minded
aftermarket service center, that testing used to be, yeah, it's a free test.
Well, I can't do that anymore.
I've got to pay the knowledgeable guy at least the living wage.
And so as long as I'm providing value and I give some sort of direction,
people don't want to hear like my plumber recently, that's another story.
Well, we think it's this, it's 50,000.
It's like, ah, I need pinpoint testing to take the guest's work out.
And that's where we're at.
And unfortunately, it's gotten a lot of costly.
Things are, as you said, Ray, there are a lot more complex underhood.
And, Fred, you mentioned supply and demand.
I'm going to pull up something that my dad and I haven't talked about on the show,
but is really relevant to this.
Ford CEO recently came out and announced that they needed, if I think it's five,
even up to now 7,000 mechanic roles that they need filled and it's existential.
They think it's a huge threat for their business.
They launched a whole new apprenticeship program out of their franchise dealer
operating centers as well.
So, I mean, there is a tremendous amount of pressure in the auto industry right now
to find those to your point half million mechanics that are necessary.
And when you have any type of supply shortage or demand shortage,
that has price implications.
And it justifies what we're seeing here with these exploding repair bills.
It's not necessary.
Again, parts have gotten more expensive.
The cars have gotten more complex.
There are not enough qualified people to work on those vehicles.
And if I may, here we had a comment come in from forerunners.
I was making $140,000 a year as a tech and that was too much.
So, the dealer I worked at changed my bonus rate.
I was under $90,000 after that I left.
There's no incentive to be better at your job.
What's your take on this, Frank?
And again, we don't have...
Listen, it's broken.
And I represented close to 6,000 automotive service centers across the country.
I was honored to hit DC, keep it safe.
The system is broken.
Here we are.
There's two full things happening.
And I speak on this often and it's changing slowly.
The flat rate system is broken.
That's the bottom line.
You know, when Mr. Jim Farley complains about needing 5,000 to 7,000 individuals
to fill the bays, that's a tough swallow.
Because everything for a technician is given in such a...
I got to start at zero every day.
Now, even with a bonus, there's issues with how maybe that hybrid plan is set up.
You need to pay people.
Technicians need north of six figures.
Entry level technicians should be making $30 an hour
and they should not be behind a broom.
And I speak to aftermarket and dealerships.
It's not one side of the fence.
And until we can fix that and give that industry honor,
technicians are grinding through the bays.
They are dealing with all kinds of issues and complexities.
And if they have to chase money and consumers know it
because they'll walk into a place and they'll feel that energy,
they're not taking care of personally.
It seems like we're chasing money.
We need to change how we pay.
And unfortunately for the consumer, the labor rate has to be designed
to sustain the pay, which means labor rates go up.
But if the consumer says,
hey, I'm tired of getting ripped off with shoddy repairs,
but I'm willing to pay more to feel good that this repair was done successfully
and the guy or gal that worked on it can get paid appropriately,
we don't have to be scared to charge what we're worth.
And I speak to four runners here to make 140k and then start playing with money.
So ultimately, I will share my business experience.
I had to do the math and said, okay, this is what I've got to pay.
This is what I must charge.
My first shop in 95, no, it was cheap.
I'm going to, that was my business model, like many new business owners.
I'm going to be cheap.
He's 80, they're 70, they're 60.
I'll be 55.
No clue.
It couldn't even afford to breathe.
So like we have to have a business model that sustains
people that can get paid to do its right under hood, not chase things and cookie cutter.
Look, the flat rate system also promotes this sort of air of short cutting.
And you know, short cutting doesn't, yeah.
I mean, it's just, it's not good for the consumer.
Can you explain to the audience what the flat rate system is?
Absolutely.
So they have a better understanding.
Yeah. And forgive me for not alighting when I assume that.
So the flat rate system essentially says, if we pay a technician $30 per flat rate hour,
he's on deck or she's on deck for eight hours, let's call it a day.
That technician can make as many hours.
So let's get back to the job at hand.
If a break repair by a guide, a labor guide, and it's just a guy says,
hey, we'll pay you an hour to do front breaks, pads, rotors, hardware.
We'll pay you another half an hour.
So an hour and a half total.
If he is done in a half an hour, he gets an hour and a half.
Now, the argument from the consumer, and it's fair, it's a fair argument,
is that, well, he only took a half an hour and I got to pay an hour and a half.
But the fact is you're paying for that skill set of efficiency.
That's in a nice, ideal box that the system is working properly.
Because that same technician will have to pull an evaporator or heater core and pull a dash.
That may be eight hours.
However, it may take them two days.
So it's a fair balanced approach.
Where the system is broken is I, as a technician, if I come into work and I'm at zero every day,
I've got agita, I've got anxiety, am I focused on what?
Chasing money.
So the system needs to be changed.
And some of that is, unfortunately, I go back to the consumer and producer.
As consumers, we have to be willing to pay for the good stuff,
because that's what it's going to cost.
And there can be options.
If you want to pay less, they're out there.
But that's where we're at as dynamic.
And it's not just the service industry, it's across the board.
Go, Zach, I can see you when they ask the question.
No, I just find it so fascinating.
And I'm an entrepreneur, Frank.
So I listen to what you just described, and I'm like, wow, that's respectfully so dumb.
But it takes 30 minutes to do a job, you charge.
So I don't mean dumb in a pejorative or diminutive way.
I mean, it just doesn't, it's not passing the common sense test for me.
And so obviously, there are decades of reasons why it's ended up the way it is.
But it's a bummer that we have members of our community who obviously, I mean,
140 to 90, that's like a 40% decrease in earnings year over year,
because you were too good at your job.
Like, it demonstrates how broken this system currently is.
And it's scary because consumers rely so much.
God forbid I ever had a problem with my car.
Yeah, I could go to my dad, but my dad was never a mechanic.
You trust that person on the other side of the service desk?
Way more, way more.
I got to interject because, look, I'm passionate about it.
There's no hiding it.
I've got a lot of blood sweat cuts on my skin from this business that I love.
I love Deerley.
Look, the fact is, if we're not able to pay properly, it all trickles down.
And I get it.
Some would argue, well, the market place is diverse.
It's like selling cars.
We need the $15,000 used car.
Then there's the 30, there's a market for everything.
But I think in the end, the technician needs to get paid an honest livable wage
that needs to be training provided.
And at the end, the consumer has to be willing to pay for that.
Otherwise, it's monkey business.
I give you the free check engine lights that are notorious.
There isn't anything free.
I mean, really, that bill is going to be passed on somewhere in the final invoice.
So if we just said, hey, we're just being transparent, there is a fee.
But I'll tell you what we'll do.
We'll honor.
And when we come back with the findings, we're not guessing here.
This is what you need.
So I don't have the answers.
I do speak on Farley's statement.
I would rather have had his PR people come up.
And they do a lot of work for the industry on the education side.
They're definitely connected with trade schools.
But I think if they're going to try to fix their back bay issue,
they've really just got to get more into a livable wage with maybe a little
bonus on production.
We're a production-based business, and I get that.
But to be totally on production, that's tough these days with the way these cars are built.
I think part of the problem, Frank, is that we have to make trade schools sexier.
OK, we have to convince kids out there that it's OK to work with your hands,
that it's OK to have the ability to fix things.
It did not just always work with your mind.
And my son jokes, if you ever looked at my hands, there's not a callus to be found.
Because I don't know how to really work with my hands.
But if trade schools were sexier, and more kids looked at it as a real honest-to-guide
legitimate way to be able to make a nice living, to be able to make a middle-class living,
if that's even doable today anymore, then perhaps we would attract more people to it.
That's, I think, one of the ways that you could address the shortage
of mechanics out there, it seems to me.
Yeah, well, as I said, I can do our little show from any radio station.
It goes out to California, and we've been obviously podcasting over 350 episodes.
It's really a lifestyle show, as you guys know.
My mantra is really to preach.
Our live show, which was done at the East Valley Institute of Technology,
is really not to preach, but connect with parents.
I'll get silly, and I'll say, hey, blue collar is the new white collar.
You're not going to replace us with AI.
I'm working day in and day out.
We've got a show later today this afternoon, and we're trying to bring more of a feel good,
but I will be transparent and honest with you guys.
I feel as if the industry is not moving.
If you look at the statistics, we've had more since COVID.
We've had an uptick in entrance to trade schools, but we're still losing them
because these youngsters, or even let's not forget, are retraining adults.
You got an individual that's retraining for welding or what have you.
It's really up to the industry to really set a path.
We can't just lot jockey our kids.
We can't just put them behind a broom.
These kids are sophisticated.
And Ray, I know you've heard this, and I know you believe otherwise.
It just seems like the older set, myself included, we can argue with Zach.
While those generation axers and boomers, they don't know how to communicate with us.
And you know what?
We need to work on that because the communication gap is what breaks everything.
Instead of saying, oh, that kid is lazy, we're not willing to invest in what we don't know
for communication because you have the raw bones of talent, and they just need to be nurtured.
And look, we talk about pay, but we also know the culture of an environment is critical.
And so the industry across the board, we need to do a better job.
I can say in the aftermarket, there's a good 10% of us as a rough number
that are really changing the way we do business by really just taking care of our tribes,
more Navy seal-like, and not some whatever, us bludgeoning through the grime of lost.
Well, Frank, we are so grateful for your time.
Again, a friendly reminder for everyone who's watched today's
show with us here, Frank Runs Rengenation, among many other things.
I'd start here if you're interested in learning more about Frank.
Frank, I'll hand off to you.
Actually, if folks are interested in learning more, obviously you have the show Rengenation.
You have your retail storefronts in the Arizona area.
Where else can people learn more about the work that you're doing?
Yes, so Rengenation is really our platform.
And then, of course, my retail is Desert Car Care Cave Creek.
It's Cave Creek, Carefree, North Scottsdale.
We always invite folks for a shop tour.
We get to work on some pretty cool, amazing vehicles.
And Rengenation.tv, it's podcasted.
And we have a little YouTube channel.
And I'm growing up like you guys.
I'll get there, but maybe one or two videos a month.
And hey, I want to just acknowledge the great things that you guys are doing.
I love the channel and your Carriage platform is just an amazing consumer tool.
So thanks for slicing and dicing through all the noise and helping us out.
Thank you, Frank.
I will let my dad send you off here in just a moment.
I'll just propose maybe we can get you on again in the future and have some
questions from our community.
I'm sure there are questions that they'd love to get your take on.
So just floating that as an idea, leave a comment in the chat or in the description
or below the description on today's video.
That would be helpful for us to see.
But dad, send Frank off here for us.
Thank you, Frank, for your time.
Frank, thank you so much.
Yes, we'll all remember to hug a mechanic if we can find one.
You can't hug, but you can't find.
But we all do need to hug a mechanic.
And Frank, if I was out there in Arizona at the moment, I would give you a big hug.
I will say this to you.
My plan is to become an Arizona snowbird this winter.
So I'm looking forward to actually shaking your hand and giving you that hug
when I get out there in November.
It would be an honor.
You guys keep doing amazing works.
And for everybody that's watching, share this with other folks.
This is a really good platform.
Thank you guys for having me.
Thanks, Frank, for all the guests.
So fun.
Frank's got great energy.
He really does.
Yeah, that was really, really awesome.
I could see us having him back on in the future and I think spending some time
with specific questions from our community around maintenance and repairs.
That question even I alluded to.
I'd love to get deeper on, should I go to the dealership?
Should I go an independent mechanic?
What's the checklist for me to think about?
There's a lot there that we can dig into.
I think what we should do next time we have Frank on is let our audience know
when Frank will be on so that we can gather up the questions beforehand
and share some of them with Frank so he can be prepared to be able to answer them in a timely way.
Yeah, it's not all about buying a car.
It's also about maintaining the car and the cost of that and ensuring the car.
I mean, it's all part and parcel of what we talk about as to the total
expensive vehicle ownership and Frank could be a tremendous resource for our audience.
Completely agree.
Well, Dad, thanks so much for your time today.
Thanks so much, everyone, for tuning in and joining us for another episode of Car Edge Live.
Leave your thoughts and comments in the feedback and feedback.
Excuse me in the comments down below.
We appreciate it and we'll be back with more Car Edge Live tomorrow.
Let's appreciate you all tuning in.
Thanks so much, everybody.
See you back here tomorrow at noon Eastern.
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