Everything Dealerships Need to Know About Automotive Protection Products

Automotive protection products include warranties, insurance, and service agreements designed to cover unexpected issues that might arise during vehicle ownership. They can range from extended warranties and tire-and-wheel protection to paint protection and GAP insurance. These products give customers peace of mind and protect their financial investment.

Offering protection products can dramatically increase your per-vehicle profits. They provide an additional revenue stream through product sales while also enhancing customer trust and loyalty. Customers are more likely to return to your dealership for future services when they feel supported beyond the initial vehicle purchase.  

Absolutely. Automotive protection products offer buyers added confidence in their purchase, knowing they’re protected against unexpected costs. Happy customers tend to spread the word, giving your dealership more positive referrals and better online reviews. 

Some of the best-selling products include extended service contracts, GAP insurance, dent and ding protection, paint protection, and tire-and-wheel coverage. Each of these addresses specific concerns that many customers have. For example, GAP insurance is invaluable for customers financing vehicles, as it covers the difference between the car’s value and the loan balance in case of a total loss.

Transparency is key. Train your team to clearly explain the features, benefits, and costs of each product. Show how the coverage applies to real-world scenarios—such as a dented door or needing roadside assistance. Use brochures and visual aids, and encourage your team to adopt a consultative sales approach rather than a pushy tone.

Introduce protection products early in the customer’s buying journey, during discussions about financing options or vehicle ownership. Many dealerships find success discussing these products in the F&I (Finance and Insurance) office after the car purchase decision has been made. Build a strong pitch around their financial and emotional value.

Yes, when presented correctly. Today’s customers value convenience and security, and these products align with those priorities. Studies show that nearly 50% of buyers opt for at least one protection product when the features are explained in a way that’s relevant to their concerns. 

No, these products don’t involve stocking a physical inventory, so there are no significant carrying costs. After setup, they simply require sales training and regular product updates. This makes them a cost-effective addition to your dealership’s arsenal.  

When customers purchase protection products, they have more reasons to return to your dealership for repairs, routine maintenance, or replacements covered under their plans. This builds long-term relationships, giving you opportunities to upsell future services or vehicles.

Yes, the profit margins on automotive protection products are typically higher than those on the vehicles themselves. This makes them a lucrative addition to your dealership’s offerings without requiring significant additional effort.

Handle objections by addressing them upfront. For example, if a customer expresses concern about cost, explain the potential savings if unexpected repairs are needed. Use real-world scenarios and testimonials to illustrate the value of the products. An empathetic approach goes a long way in overcoming resistance.

We provide comprehensive training, marketing materials, and ongoing support to ensure your team feels confident selling these products. From creating customized pitches to equipping your sales team with the right tools, we’re here to help you succeed.

Yes. Vehicles with active protection products retain more value because any damage or issues are often resolved under the coverage before the trade-in. This allows you to provide a better offer when the customer returns.

Track metrics such as attachment rates (percentage of customers who purchase protection products), overall dealership revenue, and customer retention rates. Regular analysis will help you fine-tune your sales strategy for even better results.

Yes, many providers offer private-label or white-label options, allowing you to brand the protection products as your own. This further enhances customer trust and creates a consistent brand experience at your dealership.