IHS Markit, 2021
By Q3, the automotive sector already lost a total of
7.4 million light vehicles
due to production disruptions.
As inventory shortages continue into 2022, dealers across the country are being forced once again to pivot
their approach to achieve sustainable success.
Faced with ongoing production disruptions, record-high used vehicle auction prices and still considerably high
customer demand, many dealers are finding new, unique opportunities within the F&I department to generate
additional revenue and fuel their acquisition efforts.
This requires dealers to:
1. REIMAGINE THE F&I DEPARTMENT
As new and used vehicle prices continue to rise and
brand incentives diminish, the F&I department is likely
going to feel the impact the hardest. To maintain penetration
rates and support overall dealership profitability, dealers
need to rethink how they manage and measure success
inside the F&I department.
Look for opportunities to both support and optimize
your F&I efforts, such as:
• Re-evaluating F&I pay plans. Remember: Contracts sold at
a lower gross are still better than no sale at all.
• Marketing consumer-oriented products like wrap-coverage
more heavily as more buyers purchase pre-owned vehicles.
• Maximizing your CPO program by taking steps like
expanding program eligibility and selling pre-owned
certifications for customers at reduced rates.
• Leveraging the F&I department to maximize the
pre-owned acquisition process. Knowing demand is
high, go deeper on trades and offer customer lease
buybacks earlier.
3-STEP GUIDE
for Dealership F&I Success
Amid Inventory Shortages
Certified pre-owned
(CPO) sales reached
1,218,255 units
through July,
reflecting an
11% year-to-date
year-over-year increase.
IHS Markit, 2021