Dealers have experimented with minimizing or removing the F&I position for years. The F&I manager remains a critical job, and downsizing the department is a mistake, said Mike Maroone, former COO of AutoNation Inc. and now CEO of Maroone USA, with four rooftops in Colorado Springs, Colo.
“It’s the second-highest-paid job at our stores, right up with the general sales manager,” Maroone said. “We pay our F&I people a significant amount of money, and they earn it.”
Maroone has no interest in eliminating the F&I manager position. Those who have generally bring it back, he said.
Justin Gasman, financial services director at McCaddon Cadillac-Buick-GMC in Boulder, Colo., says the specialization of an F&I manager is invaluable to dealerships as a whole. Consolidating the position into that of a salesperson comes with compliance risks and likely a decline in F&I product sales, Gasman said.
“The only reason the dealership would still be in business today is because of F&I,” Gasman said. “Without F&I, you have nothing.”
However, some dealers see seismic shifts in how the F&I office fits into dealership operations. David Rosenberg, CEO of Prime Automotive Group, said at the Automotive News Retail Forum: NADA last month that a system that necessitates two or three people dealing with a customer stagnates relationships. More customers shopping online and spending less time in the physical store will eventually result in the removal or replacement of multiple dealership departments.
“Potentially, an F&I manager may be a thing of the past. The BDC agent may be a thing of the past. We will have salespeople potentially who handle a customer from A to Z,” Rosenberg said.
Liza Borches, CEO of 13-rooftop Carter Myers Automotive Group in Charlottesville, Va., said major changes to the department will come only if they reflect consumer demand.
Borches believes F&I managers’ large paychecks can only persist if their duties shift onto the sales floor. She envisions a hybrid manager integrated with the sales desk who will structure deals early on, she says. The hybrid manager would also train sales associates on compliance and F&I product sales.
“You cannot sit in an F&I office, simply present a menu and print paperwork and sell some product and still be around five years from now,” Borches said, “maybe even two years from now.”
There’s no magic pill for aligning compensation the way it used to be, with the gap between F&I managers’ pay and that of other managers not as large, Walters said. He plans to make small changes, one store at a time, to figure out what will work for Friendship.
Still, there are fewer compensation complaints at his group today than he would have expected.
“Bad finance managers don’t normally stay around very long. You have to have clean paperwork; you have to work with the banks,” Walters said. “If anything, the sales managers [say], ‘If they want to take on that pressure, maybe [they] should make more than me.’ I’m surprised I don’t hear more about it.”
Hannah Lutz and James B. Treece contributed to this report.