AutoNation has been pushing F&I training for nearly a decade.
As used-vehicle sales rise and new-vehicle sales decline, AutoNation’s F&I profit per unit will likely hold steady, executives said last week.
At $1,789 on a same-store basis, AutoNation’s F&I profit per vehicle in the second quarter was highest among the public new-vehicle dealership groups.
Sales of the company’s branded F&I products drove the 6.8 percent boost, CEO Mike Jackson said.
More than 90 percent of customers who bought a vehicle from the retailer’s nonluxury stores, where the company offers AutoNation branded products, choose the branded product over a similar product from the automaker, Jackson said.
“The improvement is primarily driven by more customers choosing to get a product from us rather than us getting more from each customer that we already have,” he said.
But as used-vehicle sales rise and new-vehicle sales decline, COO Lance Iserman said, F&I profit per vehicle is likely to stabilize as new- and used-vehicle sales become “one to one.”
“We have some strengths and some headwinds, but I think what you’re seeing now in the first half of the year is probably indicative of where we’re going to be going forward,” he said.
AutoNation has been pushing F&I training for nearly a decade, Iserman said. The company now has centered that training effort around its branded F&I products, which were introduced in 2015. They were the first step in AutoNation’s far-ranging brand extension strategy, which Jackson says will keep the retailer profitable even as new-vehicle sales margins tighten.
Be the first to comment