Here’s the scenario. It’s a busy Saturday. Every F&I manager is working a deal, and there are still two customers waiting to start the finance process. What’s an F&I manager to do? You don’t want to lose customers due to a long wait, but you also want to make the most on each deal. In an effort to speed up the F&I process, it’s all too common for F&I managers to rush certain aspects, like the manufacturer’s warranty review.
However, this could lead to several pitfalls for your dealership, making the F&I process longer and leaving you open to noncompliance. Under the Magnuson Moss Warranty Act, all dealers are required to provide detailed information about warranty coverage before a customer purchases a vehicle for personal, family or household use. This helps ensure that customers know what to expect in the event something goes wrong, and it enables them to compare coverage on vehicles.
So, if a vehicle comes with a manufacturer’s warranty, or complimentary coverage of any kind, your dealership is required to inform customers of the coverage. Additionally, if an F&I manager rushes the warranty review, they miss the opportunity to identify potential consumer needs or concerns that could be filled with consumer protection products. This could lead to a much longer product presentation and negotiation process, lengthening the F&I process as a whole and potentially reducing product penetration and PRU.
The manufacturer’s warranty review is about much more than identifying what the warranty covers. Effective managers use this review to identify areas of necessary coverage and build value in consumer protection products before the product presentation.
For example, if a customer is financing a vehicle for 72 months, but a majority of the manufacturer’s warranty ends after three years, you could use the review to point out that the customer’s investment will not have the same protection for the last three years of their loan.
The warranty review helps F&I managers capture the customer’s attention, and provide a balanced overview, showing what is both covered and not covered by the manufacturer’s warranty. It makes the customer aware of all the coverage gaps in the warranty, providing the perfect tee up to the consumer protection product presentation.
So, don’t rush the warranty review. Use it to build value in your consumer protection products and reduce customer objections by creating a need up front.
With more than 40 years helping dealers achieve their profitability goals, EFG Companies knows how to train your team to maximize their effectiveness and increase compliance. Contact us today to get started.