The financial services company Protective Life Corporation's subsidiary, Protective Asset Protection, has released its 2025 F&I Industry Report. The comprehensive study offers a detailed analysis of the automotive industry landscape, characterized by moderating growth, persistent affordability challenges, and a strategic shift toward an omnichannel customer journey. This year's report highlights a new phase for the automotive industry where market headwinds are beginning to take their toll.
F&I sales growth remains resilient for most, but dealers are now tasked with educating consumers on the value of F&I protection in a high-cost environment. The report reveals a significant shift in consumer perception, with a perceived lack of value for F&I products more than doubling over the last year. Digitalization is no longer just a priority, but an effective omnichannel model is now key to success.
To navigate these changes, dealers must focus on early-stage consumer education, product innovation tailored for affordability and used vehicles, and strategic technology adoption. The report also explores the potential of artificial intelligence, noting its massive opportunity to personalize offerings and counter value-perception hurdles. Wealth-building programs have become a practical standard, with 58% of dealers participating in such programs.
The report provides specialized analysis of the marine, powersports, and RV sectors as they deal with post-pandemic normalization. The automotive market is experiencing moderating growth, while the specialty segments face challenges such as a softened market and lower front-end margins. F&I product adoption is crucial to offset these challenges and protect consumers against rising repair costs and negative equity.