CHESTERFIELD, Mo. — F&I programs, services, and reinsurance provider Protective Asset Protection released the results of a late-December 2018 online survey it commissioned to gauge how dealers leveraged F&I programs and opportunities last year.

The majority of the more than 150 dealers who completed the survey said their overall gross margins in 2018 were flat from the prior year, yet sales for F&I products were up more than 10%. In fact, 35% of dealers said their 2018 gross margins were unchanged compared to 2017 figures.

Roughly 32% of dealers said their F&I product sales were up more than 10% in 2018; another 30% said their F&I product sales were up 5% to 10% compared with 2017. Nearly 42% of dealers said vehicle service contracts were their biggest seller, followed by maintenance programs (38.9%).

Analysts noted that VSC and maintenance programs are becoming more popular as more car buyers turn their attention toward used vehicles. Used-car sales are estimated to have reached 39 million in 2018, compared with just 17.3 million new-vehicle sales. In 2019, sales of new vehicles are expected to dip down to 16.8 million, according to NADA forecasts. And with cars now representing just 30% of overall vehicle sales, many consumers must rely on VSCs and maintenance programs for upkeep on their higher-priced trucks and SUVs.

“We believe the demand for many F&I products will continue to grow in the coming years, especially as more consumers turn to pre-owned vehicles to combat affordability sticker prices on new vehicles,” said Rick Kurtz, senior vice president for Protective Asset Protection. “What’s more, the continued trend of off-lease volume will place additional focus on used vehicles, where VSCs and maintenance programs will significantly help ensure consumers keep their vehicles on the road and running. Also, we see dealer-owned warranty company programs, in particular, helping dealers offer branded F&I products designed to meet the needs of their customers.”