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US Equity Advantage Partners with Brown & Brown

ORLANDO, Fla. – US Equity Advantage (USEA) has entered into a partnership agreement with Brown & Brown Insurance, one of the nation’s largest independent insurance brokers, to provide its AutoPayPlus biweekly loan payment service to automotive and recreational vehicle dealers. To facilitate the partnership, USEA has also completed an integration with American Guardian Warranty Services, Inc.’s AGWSmenu software selling platform used exclusively by Brown & Brown. AutoPayPlus is the first vehicle financing solution outside of the AGWS family of products to be offered on the AGWSmenu.
AutoPayPlus is an F&I service that provides greater value to vehicle dealerships by helping buyers better afford their loan payment, purchase additional F&I products such as extended service contracts and GAP insurance, trade out earlier and return to the selling dealer in a positive equity position.
 
It works using simple math. Standard loans require one payment every month. AutoPayPlus’ biweekly loan payment service divides this payment in half and automatically debits that amount every two weeks. Because there are 52 weeks in a year, the borrower makes 26 biweekly payments over the course of a year (the equivalent of 13 monthly payments) with the extra payments applied to the principal. That extra month’s payment per year can reduce interest charges, shorten the term of the loan and accelerate the optimum time to trade their vehicle. 
USEA is a leading provider of biweekly payment programs for the auto industry with more than 100 combined years of F&I experience. A 10-year analysis by the company found that dealerships sell approximately one-half to two-thirds more F&I products on biweekly deals as opposed to standard retail deals by utilizing this payment structure. In addition, results from USEA’s top dealer groups reveal a 63% increase in per-vehicle financed income on AutoPayPlus customers.
“Auto dealers nationwide have found success with USEA’s AutoPayPlus biweekly payment service,” said Mike Neal, head of Brown & Brown’s recreational insurance group. “Our recreational vehicle dealerships can expect even greater success using this strategy because of larger average finance amounts and longer loan terms.”
“Over the past 19 years, American Guardian has been proud to offer a full suite of F&I products that provide excellent coverage and value, while allowing for higher profitability for dealerships,” said Jon A. Anderson, senior vice president of sales and marketing of American Guardian. “Extended service contracts, appearance protection, warranty protection, and tire and wheel coverage are just some of the products that American Guardian offers.” 
 
Dealers who take advantage of the AutoPayPlus service will also benefit from the high-touch support that USEA provides including unlimited in-store training and hands-on in-house dealer support designed to increase F&I sales performance and customer satisfaction. “We look forward to adding Brown & Brown’s dealers to our nationwide family and getting them up and running within 24 hours of signing an agreement with us,” said Robert Steenbergh, CEO of US Equity Advantage.

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AutoGravity’s Car-Buying Platform Surpasses 1 Million Users

IRVINE, Calif. — Fintech firm AutoGravity, the grand prize winner in F&I and Showroom magazine’s inaugural F&I Digital Media Awards, announced that its online car-buying platform has surpassed 1 million users.

Launched in 2016, AutoGravity rapidly expanded from 100,000 users in its first six months to more than one million users less than a year later, growing its user base 10 times in just one year.

“We empower car buyers, dealers and lenders with a cutting-edge digital retail solution,” said AutoGravity CMO Serge Vartanov. “AutoGravity eliminates ambiguity by linking monthly payments to actual cars, saving consumers time and creating efficiency for dealers and lenders.”

In 2017 alone, AutoGravity users requested more than $1 billion in vehicle financing. The platform allows users to find and finance their car from their smartphone. AutoGravity shows users everything they need to buy any dealership car, down to the mileage, options and photos, and gives them the peace of mind of selecting the rate, lender and payment that’s right for them.

Additionally, AutoGravity has built partnerships with many of the largest banks and financial institutions in the world, including Mercedes-Benz Financial Services, Volkswagen Credit and Hyundai Capital America. AutoGravity has also partnered with the Top 5 dealer groups in the U.S., building a network of more than 2,000 dealers.

For more, visit www.autogravity.com.

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J.D. Power: Differing Approaches to Digital Financing Creates Wide Satisfaction Gap

COSTA MESA, Calif. — Digital auto loan applications can lead to improved customer satisfaction, but wide variance in the execution of the digital application process has created a significant performance gap between top and bottom performing finance sources, according to the J.D. Power 2017 U.S. Consumer Financing Satisfaction Study.

The top-performing mass market and luxury finance sources rate significantly higher than the lowest performers (8.75 vs. 7.93 and 8.85 vs. 7.54, respectively, on a 10-point scale) in the most heavily weighted website attribute in the study: range of services that can be performed online.

“With such erratic approaches to digitalization, many auto lenders are failing to successfully capitalize on tremendous cost-cutting opportunities that have proven to boost customer satisfaction,” said Jim Houston, senior director of automotive finance at J.D. Power. “With some lenders varying widely on ease-of-use satisfaction scores for their digital offerings, a huge opportunity is going unmet by many.”

While the digital application channel generates significantly higher levels of overall satisfaction among both mass market and luxury customers, many are waiting longer for a credit decision than those utilizing dealer representatives. According to the study, just 30% of customers applying online received a credit decision within 15 minutes vs. 46% who filled out a paper application with a dealer.

The study also found that time given to make first payment provided the greatest impact on the onboarding experience. High-ranking mass market and luxury finance sources, for instance, performed highest on time given to make first payment, allowing an average lead time of 21.2 days for mass market customers and 18.4 days for luxury customers prior to first payment due date.

Driving the highest customer satisfaction were autopay and web-based payment services, with mass-market customers paying by hard-copy check significantly less satisfied than those using autopay (800 vs. 851, respectively, on a 1,000-point scale).

Lincoln Automotive Financial Services ranked highest among luxury brands with an 890 score, while Lexus Financial Services (875) ranked second and Acura Financial Services (855) ranked third.

Ford Credit ranked highest among mass market brands with a score of 857. BB&T/RAC (855) ranked second and Honda Financial Services (855) ranked third.

The 2017 U.S. Consumer Financing Satisfaction Study measures overall customer satisfaction in four factors: billing and payment process; onboarding process; phone contact; and website. Satisfaction is calculated on a 1,000-point scale. The study is based on responses from more than 14,500 customers who financed a new- or used-car loan or lease within the past four years and was fielded in July to August 2017.

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Black Book Provides Appraisal Data to ASNSoftware

LAWRENCEVILLE, Ga. — Black Book (div. Hearst Business Media) has signed a partnership agreement with ASNSoftware, a provider of dealer management software and solutions for independent and RV dealerships. Black Book will provide vehicle valuation data for ASNSoftware’s DMS, giving users a new tool for trade valuation, inventory solutions, financing, floorplanning and service and repair.

The announcement cited a recent Black Book survey that showed consumers feel a vehicle trade-in quote that’s far from expectations is the second-most likely scenario to kill a possible deal. Many consumers cited specific frustrations with the valuations they often receive. More than one-third (36%) of those polled said their researched quote was $1,001 to $1,500 apart from the dealer’s offer; another 27% said their quote was more than $1,500 apart. Nearly half (47%) said they need the dealer’s offer to be between $501 to $1,000 of their research quote for it to be acceptable.

“ASNSoftware has been helping dealerships become more competitive and profitable for the last two decades through advanced tools and knowledge that produce optimum purchasing power,” said Alex Azary, business consultant for ASNSoftware. “Our focus on advanced automation and dealer workflow integration, coupled with resources driven by industry leaders such as Black Book, means we help Independent dealers position themselves for maximizing profit.”

“Independent dealers are a critical part of the automotive landscape, with millions of car shoppers relying on them for their next mode of transportation,” said Jared Kalfus, senior vice president of sales and marketing at Black Book. “Because of this, it’s important to provide Independent dealers with the best tools and resources, such as accurate trade valuation, so that they can offer a great customer shopping experience with as little friction as possible during the transaction process, ultimately helping them compete at the highest levels.”

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Edmunds: 100,000-Mile Cars More Valuable Than Shoppers Think

SANTA MONICA, Calif. — The tight supply of late-model used vehicles is squashing the long-held belief that a car’s best days are behind it once the odometer passes the 100,000-mile mark, at least according to Edmunds’ used-vehicle market report for the third quarter.

The site’s analysis of late-model used vehicles revealed that values decline only incrementally between 100,000 and 150,000 miles, and the rate of depreciation is similar to the decline that occurs between 50,000 and 100,000 miles.

“After about the first 40,000 miles, vehicles depreciate at a slow and steady pace. The most dramatic drop-off is actually during the first 20,000 miles,” Edmunds Senior Analyst Ivan Drury said. “The 100,000-mile myth is really just a psychological barrier that more and more car buyers are getting past.”

Drury noted that following the recession, many people were forced to hang on to their vehicles longer than they may have wanted because they couldn’t afford a new car. “People then saw for themselves how much vehicle quality has improved and realized that car with 125,000 or even 150,000 miles still has a lot of life left,” he added.

And according to Edmunds data, these older, higher-mileage vehicles are in high demand among car shoppers.

In the third quarter, for example, a 2013 model-year vehicle with between 10,000 and 20,000 miles on the odometer took, on average, the exact same amount of time to sell as one with between 90,000 and 100,000 miles. A 2010 model-year vehicle only sat on a dealer’s lot for an average of 34 days in the third quarter, while a 2013 model-year vehicle sat for 42 days and a 2016 model-year vehicle took an average of 51 days to sell.

Drury noted that even though the number of off-lease vehicles entering the used market is starting to level off, the average price of a used vehicle is still at a record high due to demand remaining strong at the lower end of the market. “While the oversupply of newer vehicles is good news for buyers who can afford them, there’s still a very large segment of the population who just want an affordable vehicle to get them from A to B, and those are becoming much harder to find,” Drury said.

The popularity of SUVs and trucks is also a driving force behind used-vehicle prices, creating a significant residual value gap between passenger cars and larger vehicles. For example, a used 2015 midsize SUV with 100,000 miles still holds 50% of its original value. In contrast, a midsize car with 100,000 miles retains only 42% of its value. The gap widens even further between older, low-mileage used SUVs and passenger cars.

Drury said it’s a good time for consumers who are hanging on to an older SUV and thinking about trading up for a new vehicle to pull the trigger. “You’ll have the chance to take advantage of record-level new vehicle incentives and year-end savings, as well as get top-dollar for your current vehicle.”

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Bloomberg: Senate Banking Chair Closing In on Bipartisan Dodd-Frank Rollback

WASHINGTON, D.C. — Republican Senator Mike Crapo (R-Idaho) told reporters on Wednesday he’s getting closer to brokering a deal on bipartisan legislation aimed at rolling back parts of the Dodd-Frank Act, according to a Bloomberg report.

The lawmaker, who chairs the Senate Banking Committee, is in talks with moderate Democrats Jon Tester of Montana, Heidi Heitkamp of North Dakota, and Joe Donnelly of Indiana about easing the compliance burden on community banks as well as regional lenders after talks with Democrat Sherrod Brown of Ohio broke down earlier this month.

Tester told reporters a deal could be reached as soon as this week. For more, click here.

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