Tag Archive | "Ally Financial"

Ally Posts Near-Record Originations in Q2

NEW YORK — In the second quarter, Ally Financial Inc.’s auto franchise posted its second highest level of consumer auto originations in its history. The feat was driven by record decision applications and used-vehicle originations.

Consumer financing originations totaled $10.9 billion for the quarter, up 11% year over year. The originations were comprised of $4.7 billion in new retail, a record $3.1 billion in used retail and $3.2 billion in leases. Officials added that volume from non-GM and non-Chrysler dealers grew 48% on a year-over-year basis and now accounts for 20% of the firm’s total consumer originations.

“The second quarter, I think, clearly demonstrated the strength of our core auto franchise,” said Ally CEO Michael Carpenter during the company’s July 29 investor call. “Auto originations in the quarter are evidence that Ally’s dealer-focused, go-to-market strategy is winning despite the intensity of competition in the market place.”

Ally’s auto franchise posted a pre-tax income of $461 million for the second quarter, up from $382 million in the year-ago quarter. The increase was driven by a 14% increase in net financing revenue from a year ago.

Retail auto net charge-offs accounted for 0.58% of all open auto loans, down from 0.85% in the year-ago quarter. Ally’s delinquency rate, however, increased, rising from 1.59% in the year-ago quarter to 2.02%. “This was up quarter over quarter given normal seasonal performance trends, where delinquencies are lowest at the end of the first quarter,” CFO Chris Halmy said. “Year-over-year delinquencies were up 24 basis points, which are consistent with our expectations and the more balanced origination mix that we’ve had since 2012.

“Overall, the takeaway here is that auto asset quality results were well in line with our expectations as we continue to anticipate seasonality quarter over quarter and a gradual increase in charge-offs year over year due to normalization of our portfolio.”

Consolidating all of its business units, Ally posted net income of $323 million in the second quarter vs. a net loss of $927 million in the year-ago quarter. That loss was related to the $1.6 billion settlement agreement in the ResCap Chapter 11 bankruptcy case.

Officials also reported continued progress in expanding its diversified dealer relationships. In the second quarter, the company grew its dealer count by more than 900 dealers from a year ago. Including auto and RV dealers, Ally’s dealer count totaled approximately 16,400 dealers at the end of the second quarter.

“So we continue to make good progress expanding and, obviously, that’s showing up or manifesting itself in some of the diversification numbers that you see in origination as well,” Halmy told investors. “So about 20% of the originations we are doing [with] non-GM, non-Chrysler [dealers].

“I think when we think about relationships, we try to conquest. They are more of the franchised dealers and I think that’s somewhere in the neighborhood of more like 18,000 dealers,” he added. “So, obviously, at 16,400 dealers, we are doing the lion’s share of them today.”

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U.S. Treasury Will Not Increase Pay for Ally Financial CEO

(Reuters) – The Obama administration is holding the total compensation unchanged this year for the head of bailed-out auto lender Ally Financial, the Treasury Department said.

“The CEO compensation package payable by Ally Financial has not increased,” the Treasury said in a statement, adding that the overall amount of compensation for the company’s CEO has been unchanged since 2010.

Michael Carpenter has been Ally Financial’s CEO since 2009, according to the company’s Web site.

U.S. taxpayers bailed out Ally, along with much of the U.S. financial and auto sectors, under a $700 billion program enacted in 2008 to fight a financial crisis and recession. Ally and a clutch of other firms had to agree to pay restrictions set by Washington because they received out-sized aid.

Over the last few years, the Treasury has sold shares in most of the firms it bailed out. Taxpayers have recouped nearly all of the $423 billion that was spent under the bailout, known as the Troubled Asset Relief Program, or TARP.

Ally is the last firm with compensation packages set by the administration, although the Treasury said last week it would sell most of its remaining Ally shares.

The Treasury has been criticized in the past for alleged laxity in pay restrictions on the company’s executives. An internal Treasury watchdog last year criticized the department’s authorization of pay hikes for executives at Ally, and at General Motors and AIG, which were also bailed out under TARP.

The Treasury said it was keeping cash compensation for Ally’s top 25 executives unchanged. Most of their compensation, however, is in stocks, which the Treasury says makes their pay performance-based.

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Ally and TIME Announce 2014 TIME Dealer of the Year

New Orleans — Ally Financial and TIME announced that Jeff Teague of Teague Ford Lincoln in El Dorado, Ark. has been selected as the 2014 TIME Dealer of the Year. Teague was selected from a group of 56 U.S. dealers who were recognized at the 97th annual National Automobile Dealers Association (NADA) Convention & Exposition. Tim Russi, president of Auto Finance for Ally, and Moritz Loew, vice president of sales for TIME, announced the winner and finalists during the opening session of the convention.

“This award recognizes the best of the nation’s dealers, not only for their business successes, but for their extraordinary commitment in giving back to their local communities,” said Russi. “Ally has had the privilege of supporting numerous dealer charitable causes in connection with the TIME Dealer of the Year program, and we are honored to congratulate and recognize 2014 winner Jeff Teague and the finalists for their continued efforts in building better communities.”

In its third year as exclusive sponsor, Ally will contribute $10,000 to the winner’s 501(c)(3) nonprofit organization of choice, as well as $5,000 to charities selected by each of the three regional finalists. Ally also donated $1,000 to charities selected by each of the 56 dealer nominees.

The three regional finalists for the 2014 TIME Dealer of the Year award are Greg Kaminsky of Toyota of El Cajon in El Cajon, Calif.; David Luther of Luther Westside Volkswagen in St. Louis Park, Minn.; and Marisa Shockley of Shockley Honda in Frederick, Md. All nominees are featured on AllyDealerHeroes.com, which highlights the philanthropic contributions and achievements of auto dealers across the United States.

The TIME Dealer of the Year award is one of the automobile industry’s most prestigious and highly coveted honors. Recipients are among the nation’s most successful auto dealers who also demonstrate a long-standing commitment to community service.

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Dealers Preparing for Strong 2014 Sales Momentum, Ally Financial Survey Shows

New Orleans – Auto dealers are optimistic about sales momentum in 2014, with a majority expecting increases at their dealerships of more than 10% compared to last year, according to an Ally Financial survey of auto dealers at the 2014 NADA Convention and Expo in New Orleans. More than 90 percent of the dealers surveyed said they had a positive sales outlook for 2014.

The key factor in sustaining these sales will be consumer confidence, according to 49 percent of dealers surveyed. The age of fleet on the road, economic policy and incentives will also be contributing factors. About 75% of dealers said that increases in sales will lead to increased sales of F&I products, such as vehicle service contracts, maintenance and GAP products.

“Dealers are energized about the year ahead and Ally’s commitment to their success was reinforced at NADA,” said Tim Russi, president of Auto Finance, Ally. “We anticipate a strong year for the auto industry as dealers leverage improved technology to help reach and serve their customers.”

Consumers can also expect more interaction with auto dealers in the social media space in 2014, as more than 76 percent of dealers surveyed said they expect to increase their use of social media to reach new and existing customers.

Ally surveyed more than 150 dealers that attended the 2014 NADA Convention and Expo in New Orleans, La. on Jan. 25 and 26.

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Ally Financial Receives Auto Finance Excellence Award

Detroit – Ally Financial was honored with a 2013 Auto Finance Excellence Award for its success and contributions to the auto finance industry. The award was presented at the annual Auto Finance Summit.

Ally was cited for its innovative service offerings, in particular the recently introduced Relationship Management Center (RMC). The RMC online platform allows dealers to directly access customer leads and the ability to produce high-quality email or direct mail communications for targeted customers.

“We applaud Ally Financial for its leading performance in the auto finance industry,” said J.J. Hornblass, president and CEO, Royal Media Group, publisher of Auto Finance News, which presented the award. “The Auto Finance Excellence Award winners exemplify the best of this dynamic industry and we congratulate Ally.”

Tim Russi, president of Auto Finance at Ally Financial, accepted the award. “At Ally, we provide an unmatched product offering in the market coupled with a high touch service level. We appreciate the recognition for the work we do and will maintain our sharp focus on the future of the auto finance industry, the needs of its dealers and evolution of technology.”

Ally has been a leading provider of auto financing for more than 90 years and currently has more than 14,000 dealer relationships and services approximately 4 million retail auto accounts. For the second consecutive year, Ally was ranked first on the 2013 Big Wheels Report list of top auto finance companies, issued by Auto Finance News in May.

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Ally Announces Marketing Efforts to Support Minority Dealers

Detroit – Ally Financial will introduce the first of several new ads in August that showcase diverse dealers. The ads are the latest addition to Ally’s “Success Stories” campaign, which celebrates the dealers and their leadership in the communities they serve.

Josefina Hooker of Freedom Buick-GMC in Odessa, Texas and Bill Perkins of the Perkins Automotive Group, which owns Merollis Chevrolet in Eastpointe, Mich. and Taylor Chevrolet in Taylor, Mich., are the first minority dealers to be featured in this new segment of the Success Stories series. Five ads featuring different dealers are expected to run through the end of the year.

“The auto industry has always been a great place to find diversity of thought, perspective and people and we’re proud to recognize the diverse dealers who share our values and serve as leaders in the communities in which they operate,” said Andrea Riley, chief marketing officer, Ally Dealer Financial Services. “We recognize that dealers are heroes in their communities and we are proud to recognize their efforts and the very real difference they make in people’s lives every day.”

The new ads will also feature videos, which will be available through a QR code and on www.allydealervideos.com. The videos will give background about the dealers as well as their perspective on their successful businesses.

In addition to the new ads, Ally will begin translating select consumer brochures into Spanish for dealers free of charge. “We want to provide dealers an additional way to connect with their Spanish-speaking customers,” Riley said.

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