In 2023, the average sales gross profit declined, reducing to about $3760 per unit from the 2022 average of $7210. In percentage terms, this profit has almost halved, going from 13% of the selling price to just 7%. On the flip side, the F&I department’s performance remains high, with a profit margin per unit at 7% of the average selling price. This is consistent with last year’s figures. However, F&I now contributes 50% of the total gross profit for each RV sale. The continued growth in finance penetration, even amidst rising interest rates, is particularly noteworthy. At over 62%, this suggests that consumers are still willing, or even keen, to finance their RV purchases, providing an excellent avenue for the F&I department to increase its profits. DON MILLER Senior Data Consultant, IDS
Figure 1. First Half Average Dealership Revenue by Year
$16M $14M $12M $10M
$8M $6M $4M $2M
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
Figure 1 shows that sales revenue in the first half of 2023 is down 18% compared to the first half of 2022 and down 22% compared to the first half of 2021. However, in the broader context, the growth in sales revenue since 2017 has been positive, with 2023 still performing better than 2018, 2019, and 2020. This means that while there might be short-term challenges, the overall trend remains positive. Leverage the Finance Trend The willingness of consumers to finance their RVs, even with higher interest rates, provides a ripe opportunity. Offering competitive rates, flexible payment options, and partnering with a broader range of financial institutions could further boost F&I profits.
Dealership Industry Insights by IDS is a monthly report that includes:
• The impact “out of stock” parts and “warranty coverage” have on repair cycles • Top Work Orders for each service bottleneck • RECT of your dealership’s top brands • Delivery (or lead) times of top vendors • Unit sales vs. the previous year • F&I insights
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