Protective Asset Protection, a leading provider of F&I programs and services, revealed its 2024 F&I Annual Update Report.
The comprehensive report offers valuable insights into the current state of the automotive industry, focusing on F&I product trends and how dealers are maximizing F&I product options to continually address consumer affordability challenges. To download the report, click here.
“Our 2024 F&I Annual Update Report underscores the resilience and adaptability of the automotive industry in the face of ongoing challenges,” said Rick Kurtz, senior vice president and chief distribution officer for Protective Asset Protection. “Dealers are navigating a complex landscape of fluctuating vehicle prices, shifting consumer preferences and economic uncertainties. However, we’re seeing encouraging trends in F&I product sales, particularly in the digital space. The growth in online F&I offerings presents a significant opportunity for dealers to enhance their profitability and customer experience.”
Key report findings:
The report highlights several key findings, including the growing importance of online F&I offerings. Approximately one in five dealers reported that 75% or more of their customers purchased F&I products online in the last 12 months, while nearly 70% of dealers have seen a moderate to significant increase in F&I sales from online offerings.
Despite challenges such as increased vehicle transaction prices and longer loan terms, over 70% of dealers reported an increase in F&I product sales in 2024 compared to 2023. The report also reveals that consumers are most interested in F&I products that protect major mechanical components, electrical components and technology features.
Addressing affordability concerns, the report suggests that dealers are exploring strategies such as offering a wider range of F&I products and focusing on options for used cars. The importance of early consumer education about F&I options is emphasized, with over 18% of dealers believing that consumer-facing online education early in the research process would help increase sales.
“The report highlights the critical role of F&I products in dealership success, especially as margins on vehicle sales continue to tighten,” said Kurtz. “We’re observing a growing interest in products that protect major mechanical components, electrical systems, and advanced technology features. This trend aligns with the increasing complexity of modern vehicles and consumers’ desire for long-term protection of their investments.”
Renewed Focus on Wealth Building
The 2024 F&I Annual Update Report also delves into the growing significance of wealth-building programs for dealerships, highlighting opportunities such as dealer-owned warranty companies and reinsurance programs. Additionally, the report provides insights into the specialty markets, including the marine and RV industries.
Kurtz continued: “Looking ahead, dealers who can effectively leverage digital platforms, offer a diverse range of F&I products, and focus on early consumer education will be well-positioned for success. Additionally, the growing importance of wealth-building programs, such as dealer-owned warranty companies and reinsurance options, offers dealers new avenues for financial growth and stability.”
Protective Asset Protection’s 2024 F&I Annual Update Report serves as a valuable resource for industry professionals, offering strategic insights to navigate the evolving landscape of F&I products and services in the automotive and specialty markets. To download the report click here.
