| | | WEEKLY REPORT | July 25, 2012 |
| | | | | | | F&I product sales, training lift public groups
 AutoNation, Sonic Automotive and Asbury Automotive Group reported increases in F&I revenue last week as part of their second-quarter earnings results. At AutoNation, credit availability is back to pre-recession levels, even for subprime, CEO Mike Jackson said. The only difference? Customers have stopped using home-equity loans to buy a car, he said. ...  story
| Q&A
Redesigned Mercedes GL wins higher residuals
 The redesigned seven-passenger Mercedes GL SUV will arrive in showrooms in September with higher residual values, says Mercedes-Benz USA CEO Steve Cannon. ... story
| BMW Financial Services to test short-term rentals at New York-area dealers
 BMW Group Financial Services plans to launch a pilot program in the New York area next month offering short-term rentals at BMW dealerships. The test program, expected to run through year end, is limited to 12 BMW dealerships in New York, New Jersey and Connecticut. The company hopes that BMW on Demand rentals will spur new-car sales. ... story
| Bigger pool of lenders spells opportunity
 Dealership F&I managers are in the enviable position of having more auto lenders compete for their business. A few years ago, they had the opposite problem: Lenders tightened standards, and some even bailed out of auto lending entirely. ... story
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F&I BY THE NUMBERS
| F&I revenue rises at Asbury, AutoNation, Sonic | | F&I revenue per vehicle increased at 3 big dealership groups in the second quarter compared with a year ago. F&I as a percentage of gross profit increased, as gross margins slipped on new- and used-vehicle sales. The companies blamed the declines on greater competition and higher supplies of Japanese-brand vehicles following last year's earthquake in Japan. | | | Q2 2012 | Q2 2011 | Yr.-ago change | | Asbury | | | | | F&I revenue per vehicle | $1,200 | $1,113 | 8% | | F&I % of revenue | 3.6% | 3.3% | | | F&I % of gross profit | 21.8% | 19.1% | | | | | | | | AutoNation | | | | | F&I revenue per vehicle | $1,283 | $1,236 | 4% | | F&I % of revenue | 3.7% | 3.5% | | | F&I % of gross profit | 23.1% | 20.1% | | | | | | | | Sonic | | | | | F&I revenue per vehicle | $1,055 | $1,008 | 5% | | F&I % of revenue | 3.0% | 2.8% | | | F&I % of gross profit | 20.4% | 18.1% | | | | | | | | Source: Company reports | |
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JIM HENRY
Stain persists as U.S. Fidelis case winds down -- at last
| |  | Jim Henry is a special correspondent for Automotive News | |
U.S. Fidelis continues to dog the extended-service contract industry, even though the notorious bankruptcy case is winding down to its last few official acts.
Last week, 11 states led by Missouri Attorney General Chris Koster reached a settlement with what’s left of U.S. Fidelis for $14.1 million in restitution for consumers. That’s not much, considering the company, based in Wentzville, Mo., said it had 656,000 customers nationwide when it went out of business in 2010. Divided equally, that’s about $21 each.
The company’s bankruptcy plan creates different classes of consumers. How they are defined shows what kind of scams U.S. Fidelis ran. The company sold extended-service contracts directly to consumers using high-pressure sales tactics, largely over the phone.
First in line are customers with claims for “unauthorized deductions from a bank account.” Then there are customers seeking a refund under the company’s “money-back guarantee.” Next are customers claiming “misrepresentation” and violations of the Do Not Call Registry. If all those get paid in full, there’s an “other” category.
Last, but not least, the two brothers who founded and ran the company, Cory Atkinson and Darain Atkinson, still face sentencing in September, after pleading guilty to fraud charges.
U.S. Fidelis didn’t sell extended-service contracts via dealerships. But the case still leaves consumers with a bad taste.
F&I PRESS RELEASES
» Ford Credit Earns $296 Million Net Income In The Second Quarter Of 2012
» Attorney General Koster, 11 states settle with US Fidelis -- secures $14.1 million in consumer restitution
» America's Car-Mart Opens 116th Dealership
DEALER JOB LISTINGS
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F&I BY THE NUMBERS
| VW, Ford, Nissan ratchet up leases | | The top brands in U.S. lease share as of the first quarter ranked by how much their share changed compared with a year ago. VW, Ford and Nissan had the biggest percentage increases in their share of the total U.S. lease market. Toyota, Lexus and Chevrolet had the biggest percentage declines in leasing activity. | | Brand | Q1 2012 | Q1 2011 | Yr.-ago change | | Volkswagen | 5.4% | 4.0% | 36% | | Ford | 11.8% | 8.7% | 36% | | Nissan | 8.6% | 6.4% | 34% | | Hyundai | 4.7% | 3.7% | 27% | | Mercedes-Benz | 5.9% | 5.3% | 11% | | BMW | 5.2% | 5.0% | 4% | | Honda | 14.3% | 15.9% | -10% | | Toyota | 9.3% | 11.5% | -19% | | Lexus | 3.6% | 4.5% | -19% | | Chevrolet | 4.6% | 7.4% | -37% | | | | | | | Source: Experian Automotive | |
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