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StoneEagle's Q3 2025 Financial Insights

In the latest report from StoneEagle, a recognized leader in F&I solutions for the automotive sector, the firm has announced significant trends observed during the third quarter of 2025. This period revealed the intricate dynamics of the electric vehicle (EV) market, juxtaposed against a backdrop of steady performance from F&I (Finance and Insurance) operations. Although EVs captured considerable media attention, their actual share of transactions was quite limited, accounting for merely 5.5% of franchised dealer transactions during the quarter, revealing a nuanced picture of the EV leasing landscape and its implications for the automotive market.

Key Highlights of Q3 2025

1. EV Leasing as an Accessibility Bridge: The rise in EV transactions was notably supported by leasing options, with nearly 60% of EV-related deals being leases. This strategy emerged as a critical avenue for dealers aiming to make EVs more financially accessible to consumers, particularly during the waning months of the federal EV tax credit, which incentivized greater participation but does so against rising costs and customer hesitancies.

2. Performance in Finance and Insurance: The report showcased a robust performance from F&I departments. F&I income per dealer surged by almost 12%, which corresponds directly with a rise in deal counts of nearly 3% year-over-year. This increase in income per vehicle retailed (FI PVR) also rose to $1,933, a continuation of the upward trend seen over the previous year. Notably, the gain in average products per deal stood at 2.5%, indicating that dealers are successfully upselling additional services alongside vehicle sales, even amidst fluctuations in front gross.

3. Total Gross Trends: While the total gross per deal reported a modest decline of 2.1%, the underlying statistics reveal a dip in front gross that has dropped sharply by 26% compared to Q3 2024 figures. Nonetheless, average front gross remained approximately 30% higher than in pre-COVID periods, a testament to underlying resilience.

Insights on Product Performance and Mix

Product performance within the F&I realm remained stable, affirming the sector's adaptability. Services like Vehicle Service Contracts (VSC) and Guaranteed Asset Protection (GAP) continued to contribute significantly to F&I revenue, solidifying their status as revenue anchors amid changes in consumer preferences and market conditions.

• - VSC Participation: The penetration rate for Vehicle Service Contracts held steady at 44%, consistent with both the previous quarter and year. This stability suggests dealers and consumers alike recognize the long-term value they provide in maintaining vehicle performance.
• - GAP Coverage Growth: GAP coverage rose to 38%, reflecting an incremental increase from the previous year. This popularity underscores the growing awareness of asset protection among buyers, especially in times of economic uncertainty.

Additional ancillary offerings, which include paint-and-fabric protection and prepaid maintenance, have also maintained consistent performance, accounting for about one-third of product-driven F&I revenue, further supporting profitability through diverse service offerings.

CEO Insights

Cindy Allen, CEO of StoneEagle, summarized the findings by emphasizing the importance of consistent F&I revenue streams that empower dealers to adjust their sales strategies efficiently. Allen stated, "While EVs have captivated the market, they make up just a fraction of transactions, where the real strength lies in the adaptability and skill of F&I departments to guide consumers through complex purchasing decisions."

Colin Snyder, General Manager of StoneEagle's Automotive Retail Solutions, further added, "The innovations adopted by F&I product providers signify an essential shift toward more valuable product bundles and packages that resonate with consumer needs. This shift not only enhances customer satisfaction but also fortifies overall profitability for dealers."

This comprehensive Q3 report from StoneEagle sheds light on the balancing act of embracing new market trends while maintaining core business resilience, positioning the company and its partners for targeted growth in the evolving automotive landscape.

For more detailed insights, the full report is available on the StoneEagle website.