WEEKLY F&I REPORT: GM's multipart plan to lift leasing | Credit unions get 'increased focus' with dealers | Big dealer groups pressure underperformers to increase F&I sales

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WEEKLY REPORT August 8, 2012 Tell a colleague about this newsletter         Contact Us            GM's multipart plan to lift leasing GM is using new cars, special promotions and a 2010 acquisition to lift leasing closer to the industry average. The effort comes as Cadillac rolls out the XTS luxury sedan and ATS compact car this summer, Buick promotes its “Buick Experience” 24-month lease program and captive finance company GM Financial increases its lease business. ...  story  Q&A Credit unions get 'increased focus' with dealers The traditional dealership knock on credit unions -- that dealers can't make any money because credit unions only make direct-to-consumer loans -- is out of date, according to Bob Child. ...  story  Big dealer groups pressure underperformers to increase F&I sales The F&I news coming from dealership groups' second-quarter earnings reports is mostly good. But that may mean added pressure for under-performing dealerships. ...  story  Why your lender score counts F&I managers know lenders measure car buyers against a “scorecard” that uses credit scores and other factors to decide how risky the customer is. But lenders have a “dealer scorecard” too, George Halloran, auto finance program director for the Americas at BenchMark Consulting International, told Automotive News F&I Week participants in June. ...  story            Top lenders for prime-risk loans Dealers ranked these lenders the highest for prime-risk auto loans in J.D. Power and Associates' 2012 U.S. Dealer Financing Satisfaction Study.     Lender Score (1,000-pt. scale)       1 BMW Financial 963 2 Alphera Financial 959 3 Mercedes-Benz Financial 948 4 Ford Credit 923 5 Honda Financial 906         Industry average 885       Source: J.D. Power and Associates   JIM HENRY Bad loans spell good news for dealers   Jim Henry is a special correspondent for Automotive News Good news for dealerships: Credit losses are set to increase from historic lows. Why is that good news? It means lenders are approving more subprime loans, something dealers have wanted. Ford Credit said in its second-quarter report that its percent of charge-offs for bad loans out of total receivables was a record low of only eight basis points, or 0.08 percent. "I wish I could understand why people are paying the bills," said Neil Schloss, Ford Motor Co. treasurer. Studies show that since the last downturn, customers in distress have put making their car payment ahead of other monthly bills, including mortgage payments. Several auto lenders said they expect a slight uptick in credit losses in the second half. Losses "can't continue at these abnormally low levels," said Ally Financial CFO James Mackey. That's partly seasonal. Credit performance for subprime customers is usually best in the second quarter because of tax refunds, lenders said. But it could also be part of a longer trend toward easier approvals. F&I PRESS RELEASES » Loan delinquencies and automotive repossessions drop in Q2, according to Experian Automotive » BMO Harris Dealership Finance Team Expands Into Florida DEALER JOB LISTINGS F & I Manager - Dayton Area Dealer - Dayton, OH: Dayton Area Dealer Controller - Confidential - Marietta, OH: Confidential Finance Manager - The Razzari Auto Centers - Merced, CA: The Razzari Auto Centers F&I Producer - EFG Companies - Santa Rosa, CA: EFG Companies F&I DIRECTOR - KEFFER HYUNDAI - Charlotte, NC: KEFFER HYUNDAI Business Manager - Lasco Ford - fenton, MI: Lasco Ford     GM Financial ratchets up leasing GM Financial almost doubled leasing in the second quarter compared with a year earlier. New-vehicle loans for GM brands also accounted for a higher percentage of total originations. GM acquired the former AmeriCredit in September 2010.     Q2 2012 Q2 2011 Change Originations ($ million)       Loan $1,489 $1,349 10% Lease $394 $173 128% TOTAL $1,883 $1522 24%         Lease % of total 21% 11% 84%         GM new vehicles, % of originations 45% 38% 20%         Source: GM Financial >> Unsubscribe from this newsletter                        Copyright © Automotive News                        Designed by Templatesbox.com Automotive News is located at 1155 Gratiot Ave., Detroit, Michigan, 48207