EFG Companies is hoping to reduce consumers defaulting on their loans — as well as foster preowned motorcycle unit sales — with the launch of its 1,000,000 Mile Limited Powertrain Protection program, said Glenice Wilder, EFG’s vice president of powersports.
“As with some other aftermarket products, the powertrain protection keeps the bike on the road, keeps it out of the garage, and it provides security to the lender to know that there is a product that covers the bike as long as there is a loan on it,” Wilder told Powersports Finance.
The powertrain program, which launched Jan. 18, is a spinoff from EFG’s similar auto product, Drive Forever Limited Lifetime Powertrain Protection, which has been a “great success,” Wilder said.
The 1,000,000 Mile Limited Powertrain Protection is offered complimentary to consumers on thoroughly-inspected, eligible bikes up to 10 years in age with less than 60,000 miles. The product provides coverage for the engine and transmission up to 1,000,000 miles, with towing assistance.
Customers can also enhance the coverage with an extended vehicle service contract, expanding the coverage and providing additional benefits such as roadside assistance, rental reimbursement, and unlimited number of claims.
Additionally, given the powertrain product is offered complimentary to consumers, dealers are investing in paying for that coverage, which “says volumes to the lenders, knowing the dealer has bought into the consumer and the deal,” Wilder said.
Lenders are certainly concerned with picking the right product to finance on a used loan, but a good dealer relationship helps manage that risk, Donal Hummer, president and chief executive of ThunderRoad Financial, told Powersports Finance in December.
Since the powertrain protection program’s launch, EFG has received 29 agreements from dealerships to offer the product, Wilder said. EFG Companies works directly with about 600 powersports dealerships, and indirectly with about 50 auto and powersports lenders.