Finance and insurance experts hypothesized rising certified pre-owned vehicle sales could limit vehicle service contract opportunities in the F&I office.
That's proved partly true, though F&I managers and product experts say wraparound products that complement CPO programs add value — and profitability — to the transaction.
It's unrealistic to assume dealerships will maintain the same vehicle service contract penetration on certified vehicles they do on new-car sales, according to Joe Opolski, used-car finance director at Roy O'Brien Ford in St. Clair Shores, Mich. But if the finance manager is educated on how to best sell to CPO buyers, there's plenty of profit margin to be had, he said.
For example, Ford's plan covers customers bumper-to-bumper for 3 years/ 36,000 miles, with powertrain coverage up to 5 years/60,000 miles. With CPO, that's expanded by 12 months and 12,000 miles of premium care and adds two years of powertrain protection.