F&I revenue outpaces vehicle sales in '17

Finance and insurance revenue per vehicle and overall F&I revenue grew last year at the 150 largest dealership groups in the U.S. amid an industrywide light-vehicle sales slowdown, according to an Automotive News survey.

Biggest gainers
Dealership groups with gains of 20% or more in average F&I revenue per new and used vehicle sold in 2017
  Avg. F&I revenue per vehicle retailed % change from 2016
1. Noarus Auto Group $1,492 108
2. Fletcher Auto Group $2,295 69
3. Headquarter Automotive $1,589 52
4. Price Simms Auto Group $1,606 50
5. Brunswick Auto Mart $803 47
6. David Wilson Automotive Group# $1,555 38
7. Principle Auto $1,533 34
8. Gettel Automotive $1,587 33
9. Gee Automotive Cos. $2,126 27
10. Grieco Automotive Group (previously Metro Motor Group) $1,050 23
11. Peterson Auto Group $1,731 22
12. Staluppi Auto Group $1,971 20
# Figures include data for dealerships outside the U.S.    
Source: Automotive News Data Center

As U.S. new light-vehicle sales fell 1.8 percent to 17.2 million in 2017, dealerships earned an average of $1,412 in F&I revenue per new and used vehicle retailed, a 3.3 percent rise from the year earlier, according the survey. Total F&I revenue rose 6 percent, nearly the same as the 5.9 percent growth rate in 2016.

Automotive News' fifth annual F&I survey examined the F&I results of the nation's top 150 dealership groups, as ranked by new-vehicle retail sales in 2017. The results are plucked from the 144 groups that provided finance data for 2017 and 2016.

This year's results indicate that F&I product sales are outpacing retail sales, Rick Kurtz, senior vice president of distribution at Protective Asset Protection, wrote in an email.

"This is likely the result of dealers and their management teams putting greater emphasis on their F&I operations, including providing consumers with exposure to F&I solutions earlier in the buying process," Kurtz wrote. "Successful dealers know greater acceptance of the solutions offered in F&I results in improved margins and improved customer satisfaction."

Kurtz: Pitch F&I products earlier.

He added, "It's safe to say that dealers, administrators and representatives supporting dealership F&I departments are closely working together to provide solutions tailored to the specific needs of a dealership."

Among the groups that reported F&I data, Courtesy Automotive Group had the highest average F&I revenue per vehicle sold at $2,572, down 1.7 percent, or $43, from 2016. Courtesy, of Phoenix, has four stores.

Biggest losers
Dealership groups with decreases of 20% or more in average F&I revenue per new and used vehicle sold in 2017
  Avg. F&I revenue per vehicle retailed % change from 2016
1. Ray Catena Motor Car Corp. $36 –89
2. Holler-Classic Automotive Group $486 –56
3. DARCARS Automotive Group $1,293 –31
4. Prime Automotive Group $1,084 –30
5. Holman Automotive Group Inc. $1,051 –28
6. Ken Page Auto Group $1,217 –21
7. Shelly Automotive Group $1,120 –20
Source: Automotive News Data Center

Nearly 100 groups lifted F&I revenue per vehicle, and 119 averaged more than $1,000 per new and used vehicle.

F&I revenue per vehicle dropped at 45 groups, 37 of which averaged more than $1,000 in F&I revenue per new and used vehicle. Per-vehicle F&I revenue at Ray Catena Motor Car Corp., of Edison, N.J., which has 15 stores, took the biggest percentage plunge, tumbling 89 percent from 2016 to $36.

Total F&I revenue accounted for 3.7 percent of dealerships' overall revenue in 2017, ranging from 0.1 percent at Ray Catena Motor Car Corp. to 23.6 percent at Gurley Leep Automotive of Mishawaka, Ind., which has 22 stores in Indiana.

$100 million club

Thirteen groups garnered more than $100 million in F&I revenue, accounting for $4.34 billion, roughly half of total F&I revenue from all 144 groups. Six of those 13 groups are publicly owned.

The club's newest arrival, David Wilson Automotive Group, increased its new and used retail sales 2.7 percent, growth that stands in stark contrast to its 42 percent surge in F&I revenue year over year. David Wilson Automotive, of Orange, Calif., has 16 stores in the U.S. and one in Mexico.

Jim Koons Automotive Cos. remained in the $100 million club but its F&I revenue declined 4.7 percent from 2016 to $115.5 million. Ken Garff Automotive Group also maintained its $100 million club status while decreasing F&I revenue 2 percent to $218.2 million.

Combined, the 13 groups produced an average of $1,540 per new and used vehicle, $128 more than the average.

Top per-vehicle performers

The 25 dealership groups with the highest average F&I revenue per new and used vehicle retailed in 2017
  Avg. F&I revenue per unit 2017 % change from 2016
1. Courtesy Automotive Group $2,572 –1.7
2. Niello Co. $2,435 4.6
3. Bob Moore Auto Group $2,434 8.5
4. Fletcher Auto Group $2,295 69
5. Hendrick Automotive Group $2,277 7.5
6. Ed Bozarth Inc. $2,209 1.9
7. Ancira Enterprises $2,185 4
8. Zeigler Auto Group $2,160 1
9. Gee Automotive Cos. $2,126 27
10. Car Pros Automotive Group $2,077 2.3
11. Chapman Automotive Group $2,075 –2.6
12. Jim Koons Automotive Cos. $2,047 3.9
13. McCombs Automotive $1,971 2.6
14. Staluppi Auto Group $1,971 20
15. Ken Garff Automotive Group $1,962 –0.6
16. Yark Automotive Group Inc. $1,945 8.1
17. John Eagle Auto Group $1,854 6.9
18. Safford Automotive Group $1,846 –0.1
19. Fletcher Jones Automotive Group $1,812 7
20. Future Automotive Group $1,797 –4.2
21. Hitchcock Automotive Resources $1,781 7
22. Sansone Auto Network $1,778 –0.6
23. Richardson & Partners $1,763 6.2
24. Findlay Automotive Group $1,756 2.2
25. Peterson Auto Group $1,731 22
Source: Automotive News Data Center

Top gainers

In 2017, all six publicly owned groups lifted their per-vehicle F&I revenue. Among the six, AutoNation Inc. had the highest per vehicle F&I revenue at $1,667, and Penske Automotive Group Inc. had the lowest at $1,160 but had the strongest bump in total F&I revenue with an 18 percent jump to $581.8 million.

Noarus Auto Group, of Garden Grove, Calif., had the biggest year-over-year percentage increase in per-vehicle F&I revenue, surging 108 percent, or $775, to $1,492 for 2017.

The runner-up, Fletcher Auto Group, of North Little Rock, Ark., reported a 69 percent increase, or $939, to $2,295. Fletcher Auto Group has 23 stores. Headquarter Automotive, of Miami, came in third with its per-vehicle F&I revenue rising 52 percent — or $546 — to $1,589.

Twelve groups posted F&I revenue per vehicle of more than $2,000, up from seven in 2016, including Gee Automotive Cos., of Liberty Lake, Wash., which acquired 16 stores owned by the Ron Tonkin Family of Dealerships. The deal lifted Gee Automotive's store count to 22.

Three groups pulled in less than $500 per vehicle.

$100 million club

Dealership groups with F&I revenue of more than $100 million in 2017
  2017 F&I revenue No. of dealerships
1. AutoNation Inc.* $939,200,000 258
2. Penske Automotive Group Inc.*# $581,800,000 300
3. Hendrick Automotive Group $466,993,000 98
4. Group 1 Automotive Inc.*# $429,002,000 173
5. Lithia Motors Inc.* $385,862,634 169
6. Sonic Automotive Inc.* $363,030,000 112
7. Asbury Automotive Group Inc.* $275,200,000 80
8. Ken Garff Automotive Group $218,228,597 54
9. Staluppi Auto Group $171,340,782 38
10. Larry H. Miller Dealerships $166,599,545 64
11. Greenway Automotive# $130,868,125 55
12. Jim Koons Automotive Cos. $115,482,120 16
13. David Wilson Automotive Group# $100,590,321 17
    $100 million club total $4,344,197,124  
* Publicly held
# Figures include data for dealerships outside the U.S.
Source: Automotive News Data Center

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