Think F&I managers have it tough making a sale in the United States? It’s a lot tougher in the United Kingdom and in Brazil, Group 1 Automotive says.
Group 1’s average F&I revenue per vehicle retailed in the United States last year was $1,371. In the United Kingdom, it was $615, and in Brazil, $416.
“Americans want their car, they want it today, and they want to drive it home today,” Group 1 CFO John Rickel said at a conference in New York last week hosted by Bank of America Merrill Lynch. “They come in, you help them get financed, so there’s a lot better opportunity to actually be the financing source for them.”
In the United Kingdom, he said, people order their cars in advance. They are much more likely to lease, and on average they don’t keep their cars as long as Americans, so there is much less chance of selling an extended service contract, he said.
In Brazil customers aren’t used to the idea of extended service contracts at all, Rickel said. “We do think there’s room to move it up,” he said, “but I would be misleading you if I told you that we thought we would ever get it anywhere close to the U.S. level.”