5 of 6 publicly-traded dealership groups top $2K in per-car F&I profit

Group 1 broke the $2,500 mark during the first quarter with an average $2,504 same-store F&I profit on every deal, up 30 percent from a year earlier.

Group 1’s same-store F&I revenue rose as well, to $131.9 million, up 16 percent compared with the same time last year.

The company called the gain primarily the result of increased revenue from finance, vehicle service contracts and other F&I products as well as higher penetration rates.

“Our F&I attachment rate is high,” Group 1 U.S. operations President Daryl Kenningham told investors in April.

Pete DeLongchamps, Group 1 senior vice president of manufacturer relations, financial services and public affairs, said Group 1 made a 1 percentage point margin for arranging financing, which he said “we’re comfortable with.”

The gains displayed by Group 1 resulted from increased product penetration and success with more customers, he said.

Group 1 CEO Earl Hesterberg also told investors that should vehicle or finance margins soften, costs might fall to court demand — but demand would grow.

“The power of F&I is in incremental volume,” Hesterberg said.

Higher sales volume would prove to be “a powerful offset” for a hypothetical $200 decline per vehicle, he said.

Group 1, of Houston, ranks No. 4 on Automotive News‘ top 150 dealership groups list, with retail sales of 146,072 new vehicles in 2021.

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