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can get his service through ToyotaCare completed at dealerships. Some offer more coverage. In fact, upkeep covered under the packages offered by these OEMs can be as varied as the inventory on your lot. According to the Edmunds.com report, savings for buyers or lessors of 2012 models range from more than $3,800 with BMW's rather extensive plan to as little as $75 with Lexus, which offers only the first scheduled maintenance visit free. Automakers typically offer complimentary plans on new vehicles for the term of factory warranties—particularly on high-end models—as a form of insurance on the resale value of trade-ins and models returned at the end of a lease. The maintenance packages not only ensure service by certified technicians but also act as built-in service records made easily available when the person goes to sell their car or return the leased vehicle. For customers, too, such plans offer insurance, as certain aspects of warranties may be voided by automakers if prescribed maintenance is not performed and logged at a certified service bay. Dealer-centric maintenance plans OEM plans work fine for the automaker, but may do little to help the individual dealer. These plans are not captive service, explains Gorun. For instance, a Toyota owner who purchased a car from Dealer A Dealer B, who may be a competing Toyota retailer just down the road. This works the same for PPM from virtually all automakers. "One thing critical to prepaid maintenance is captive service," he emphasizes. That is why many stores have chosen to push their own PPM administered and managed internally through Web-based products. Many of these dealer-centric PPM plans also allow for dealer branding. The best part for the dealer wanting to boost their bottom line, though, is the fact that whether the plan is complimentary or purchased by the customer, it can stipulate that service take place only at the point of purchase or at other stores within their auto group. Both independent and franchise dealers are starting to turn to this type of in-house PPM. "The third-party administrator is gone," said Gorun. "Now, the dealer is holding his own money, pricing it the way he wants it, setting his own reimbursement rates." These new dealer-centric PPM products offered through numerous companies across the nation are making their mark in the auto retail industry. Resource Automotive's DriverPlus is seeing its own unprecedented expansion nationwide. "It's the largest growth product this year," said Bauer. "The numbers are getting larger by the week." Yet another coast-to-coast provider, Allstate Dealer Services, which covers virtually all bases for dealer F&I; needs, began offering its own PPM a little more than a year ago. Regardless of the name behind the PPM, tailor-made programs now allow the service manager to be a key player in dealer pricing. This was not common with the previous generation of maintenance plans, which often left the service department to absorb any losses incurred when customers cashed in underpriced PPM. "He's no longer taking a haircut on it, he's pricing it," Gorun said of the service manager. "He knows what his margins are." In the past, the third-party administrators typically charged hefty set-up fees for PPM, offered a rigid structure in both price and scope and held the reserve on the plans. Penetration was low. Today, maintenance programs generally allow the dealer to retain the reserve and spoilage. But the key, Performance Loyalty Group's CEO said, is for the dealers to not price themselves out of selling the product. Customers, Gorun said, can easily add up the actual costs of the service covered in the plans and take a pass on purchasing ones priced too high. "Even a PPM (plan) given away for free would more than pay for itself by the end of its contracted term," he predicted, citing the likelihood of vehicle repurchase and continued service at the dealership. The actual cost of such courtesy PPM to the service department can be packed into the financing of the vehicle at purchase. components and integration with the store's existing DMS for a seamless transaction for the service and accounting departments. "You must also have a good marketing component behind it no matter your vendor," Reed added. Such marketing allows the dealer to send thank-you notes to customers after utilization of the plan and reminders as to what remains on the package. "These types of communications are what drive that visit frequency up, which is what we want," he added. Aside from pricing, customization of PPM allows dealers to set service intervals, establish time and mileage parameters and offer virtually any amenity as part of the package. "They can put anything in there they want," Gorun said. For example, dent-and-ding or detailing functions of a PPM plan may be perceived as high-value by the customer. "The customers just love it," he said of such extras. "We're a retention company, so trying Other key factors that dealers may look for in PPM are full customization, potential for rebranding, automated claim forms, assorted marketing autodealermonthly.com 21