Additional survey results from Protective Asset Protection could provide information that F&I managers are seeking as part of their pitch to vehicle buyers about service contracts and other ancillary products.
The provider of F&I programs, services and dealer-owned warranty programs recently announced results of the second part of its recent survey addressing consumer and dealer trends in vehicle service contracts and ancillary protection plans.
According to the survey, 42 percent of respondents estimate their protection plan has saved them an average of $1,000 to $2,000 in savings on repairs or parts replacements.
The results showed that vehicle service contracts and ancillary products show great value for drivers, especially on specific aspects of a vehicle. The top areas most likely covered under a vehicle service contract include:
— Steering: 47.2 percent
— Technology feature service: 44.4 percent
— Brakes: 44.4 percent
— Electrical components: 41.7 percent
— Drive axels: 41.7 percent
Officials noted areas such as transmission and suspension repairs (27.8 percent) showed the smallest responses from drivers using protection plans.
More than half of those surveyed (51 percent) said they have purchased a protection plan for their vehicle. And of those opting for a vehicle service contract, more than half (53 percent) said they have needed to use their benefits on their current vehicle.
The majority of respondents (34 percent) said they currently drive a small CUV/SUV for their vehicle. Most said they’ve used their benefits on general repairs (58 percent), while another 22 percent said they’ve used benefits on parts replacements.
Regarding ancillary protection programs, 69.4 percent said they’ve needed to have repairs on tires and wheels, 58.3 percent said windshield repairs and 47.2 percent said exterior appearance products such as paintless dent removal.
Respondents said they’ve needed to use ancillary benefits due to road hazard repairs (39 percent), accidents (17 percent) and parts replacement (11 percent).
“Vehicle service contracts can be extremely valuable to drivers, especially since there are so many reasons out of the driver’s control that cause them to go into effect,” said Rick Kurtz, senior vice president of distribution at Protective Asset Protection.
“With high-performance tires more sensitive to road hazards, and increasingly complex vehicle technology, there are a bevy of reasons why extra protection can equate to thousands in savings over the life of a vehicle,” Kurtz continued.
“And for a dealer, these F&I products offer help with shrinking margins, as well as improved customer satisfaction,” he went on to say. “We find these benefits to dealer and car-buyer are amplified when the dealer can brand them as their own, with more control over the administration of the protection programs.”
The first part of the survey results from Protective Asset Protection can be found here.