Tag Archive | "BMW Financial Services"

BMW Financial Opens Off-Lease Inventory to All Dealers


ATLANTA — In preparation of the influx of off-lease vehicles returning to the market, BMW Financial Services has made its BMWGroupDirect.com service accessible to independent and non-BMW franchise dealers, according to the company.

The website — which is powered by RMS Automotive’s web-based vehicle portfolio management solution — was previously open only to BMW franchise dealers. Now, any buyer with a valid AuctionACCESS account has 24/7 online access to BMW Group’s national inventory of off lease vehicles.

“BMWGroupDirect.com was created out of the necessity for our franchise partners to gain exclusive access to our inventory before it was offered to the wholesale buying community,” said Nina Englert, vice president of sales and marketing for BMW Financial Services. “But, given the changing dynamics facing the grounding dealer and with more off-lease inventory entering the market, we needed to take our upstream remarketing program to the next level.”

The website offers intuitive features that are meant to simplify the user experience, the company stated. Through the site, dealers can set up saved searches and alerts that will automatically alert them when specific inventory becomes available. Dealers can also search packages and options based on original build information from the plant. Given that the website is an open platform, dealers no longer have to reserve time to attend simulcast online auctions at set times or attend on-site live auctions saving them both time and money, according to the company.

“Dealers can see our off-lease inventory across multiple auction locations, making it an efficient way to source our vehicles,” Englert said. “And as the shift from traditional auction to online sales channels continues to grow, this will become an increasingly important value-add to dealers.”

Since its launch in June of last year, more than 450 BMW and MINI franchise dealers — along with 50 VIP independent dealers and wholesale buyers — have sourced, bid on and purchased vehicles through BMWGroupDirect, according to the company.

“BMW Group Financial Services and Cox Automotive enjoy a strong partnership and are committed to finding innovative solutions that drive more informed decision-making and further growth,” said Nick Peluso, RMS president. “With anticipated growth over the next several years in off-lease volumes, this solution will help BMW Group Financial Services generate greater business efficiencies that will fuel better remarketing decisions.”

However, the company stated that the program will continue to offer franchise dealers exclusive access to BMW Group company vehicles via closed sales.

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J.D. Power: Dealers Willing to Pay for Better Lender Services


WESTLAKE VILLAGE, Calif. — In the highly competitive auto lending environment, the level of service provided — including technology and a collaborative and consultative staff — is more important than price, according to the J.D. Power 2015 U.S. Dealer Financing Satisfaction Study, which found that dealers are willing to pay a premium for high-quality service.

The study measured dealer satisfaction with finance providers in four segments: prime retail credit; non-prime retail credit; retail leasing; and floor planning. Satisfaction was calculated on a 1,000-point scale. Dealer satisfaction in the prime retail credit segment is 868, and in the non-prime retail credit segment satisfaction is 828. Dealer satisfaction in the retail leasing segment is 894, while in the floor planning segment, satisfaction is 943.

While dealerships continue to seek ways to improve their margins, they also seek providers to speed customer throughput in the sale or lease of their vehicles, and in many instances are willing to pay a premium for a higher-quality financing experience. Sixty-three percent of dealers are willing to pay an additional 0.50-0.60 basis points on their loan terms (down 4 percentage points from 2014) to receive good service from their lenders in the prime retail credit segment.

The auto industry works hard to establish high-value, one-on-one relationships with their customers when it comes to the sales and service processes. The same principle applies to dealers when it comes to the relationship with their lenders in all consumer-facing products — prime retail credit, non-prime retail credit and retail leasing. Auto lending continues to be a relationship business. Findings of the study show that assigning/aligning dedicated underwriters positively impacts dealer satisfaction by providing higher levels of service and collaboration. And a majority of dealers (84%) indicated that their lenders provided a dedicated underwriter person and or team who contacted them frequently, providing valued-added communications. The study also found that dealerships retained 59% of their leasing customers through retention programs and consumer guidance provided by their lender.

A dealer-focused sales rep relationship has a positive effect on satisfaction and retail contract volume. When a high level of sales rep service is provided, satisfaction is substantially higher than when there is no focused support (935 vs. 754, respectively). Among dealers with a focused relationship in which all sales rep relationship key performance indicators (KPIs) are met, 68% say they “definitely will” increase the percentage of business they conduct with their provider. Overall satisfaction is highest when sales reps engage in discussions about customer retention (922), dealership performance consulting (916) and training and clarification of programs (916), compared with when they do not (831, 818 and 816, respectively).

“Speed of funding has become a critical differentiator in the eyes of the dealer as efficient cash flow is demanded by dealer management, not absolute finance and insurance income,” said Michael Buckingham, senior director of the auto finance practice at J.D. Power. “Fast application processing allowing dealers to speed the customer delivery process is also critical. Auto dealers are willing to pay a price premium for these services.”

Dealers don’t want loan processors; they want collaborative consultants who can support them every step of the way. High-performing lenders provide a range of services that resonates with dealers, which include helping them understand the variety of lending options available and how they can maximize profits, reduce expenses and retain customers.

In the floor planning segment, J.D. Power found that 85% of dealers are assigned a primary support representative or team who can quickly respond to their needs and questions. Additionally, 75% of dealers indicate being able to immediately reach their support staff. When this occurs, satisfaction is 975. When dealers have to wait one hour to reach their support staff, satisfaction declines significantly to 938. Plus, three-fourths (75%) of dealers indicated increasing retail business with their provider because of their floor planning relationship.

The study also touched on eContracting. When dealers use eContracting or a proprietary technology provided by their lender, overall satisfaction averages 913, compared with 856 when lenders do not use this service. Additionally, 56% of dealers indicate that faster funding time is the main reason to use eContracting. On average, there is a 39% increase in dealers’ business with their finance provider due to eContracting.

J.D. Power also ranked lenders and found that Mercedes-Benz Financial Services ranks highest among lenders in the prime retail credit segment, with a score of 971. Following in the rankings are MINI Financial Services (962) and Alphera Financial Services (961).

Mercedes-Benz Financial Services also topped the list in the retail leasing segment, with a score of 978. Following in the rankings are BMW Financial Services (961) and Lincoln Automotive Financial Services (956). The same went for floor planning lenders. Mercedes-Benz Financial Services ranked highest for a fifth consecutive year, with a score of 986, followed by are BMW Financial Services (974) and Ford Credit (961).

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J.D. Power: Overall Satisfaction with Dealer Financing Increases Significantly


Westlake Village, Calif. – Dealer satisfaction has increased in all finance provider areas for the second consecutive year, with product offering significantly contributing to increases in satisfaction, according to the J.D. Power 2013 U.S. Dealer Financing Satisfaction Study.

The study examines dealer satisfaction with lenders in four finance areas: prime retail credit; sub-prime retail credit; retail leasing; and floor planning. Satisfaction is measured across three factors in the prime and sub-prime retail credit areas: finance provider offering; application/approval process; and sales representative relationship. Four factors are measured in the retail leasing area: finance provider offering; application/approval process; sales representative relationship; and vehicle return process. Three factors are measured in the floor planning area: finance provider credit line offering; floor plan support; and floor plan portfolio management.

Overall dealer satisfaction with prime retail credit lenders is 890 on a 1,000-point scale, an increase of 5 points from 2012, and retail leasing satisfaction is 891, up 3 points from 2012. Floor planning satisfaction has increased the most among the four lending areas—an increase of 11 points from 2012 to 924 in 2013.

Increasing industry adoption rates of such process innovations as eContracting combined with improvements to dealer support and a solid product offering have contributed to satisfaction increases. The study finds that 30 percent of lenders offer dealers such options, with 39 percent of dealers that are offered these options sending business to them regularly.

“In addition to more improved services, competition and new entrants into the market provide dealers with more choices and product innovations,” said Michael Buckingham, senior director of the auto finance practice at J.D Power. “This combination also creates a highly competitive marketplace for dealers to select their finance provider and increase vehicle sales.”

Although satisfaction in the auto financing industry is improving, the study finds the following three best practices separate the lenders with average satisfaction scores from those with high scores:

  • Sales representative excellence: To dealers, the sales representative is the most important touch point with a lender. Sales reps must have the knowledge and tools to teach and train dealers on the various finance product offerings.
  • Organizational speed and efficiency: Building processes and an infrastructure that provide fast underwriting for all retail products, as well as fast funding of retail products and floor planning, is mission critical.
  • Service excellence: Dealers support lenders that have personnel who are knowledgeable, friendly and customer focused.

“Indirect auto finance lending is a relationship business between dealer and lender,” said Buckingham. “A customer-focused staff is a cornerstone for success.”

Dealer Financing Satisfaction Rankings

Prime Retail Credit
Alphera Financial Services ranks highest among prime retail credit lenders, with a score of 970. Following in the rankings are BMW Financial Services (965) and Mercedes-Benz Financial Services (953).

Retail Leasing
BMW Financial Services ranks highest among lenders in the retail leasing area for a second consecutive year, with a score of 958. Following in the rankings are Mercedes-Benz Financial Services (954) and Ford Credit (929).

Floor Planning
Mercedes-Benz Financial Services ranks highest among floor planning lenders for a third consecutive year, with a score of 971. Following in the rankings are BMW Financial Services (966) and Ford Credit (948).

The 2013 U.S. Dealer Financing Satisfaction Study is based on responses from 3,962 dealers who were surveyed between March and April 2013.

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Ally Financial Largest U.S. Auto Finance Company, Report Finds


NEW YORK — Ally Financial seized on a market buoyed by new loan originations to claim the title of largest auto finance company in the United States in 2010, according to the new Auto Finance Big Wheels annual ranking of car lenders and lessors.

Ally Financial, the bank-holding company that used to be known as GMAC, amassed an auto finance portfolio of $74 billion last year, $10 billion more than Toyota Financial Services, which came in second in the Auto Finance Big Wheels ranking, reported F&I and Showroom.

“Ally entered 2010 with a new brand, the overhang of its federal government bailout, and performance uncertainty swirling around its largest patron, General Motors, and rose above all that adversity to exit 2010 as the No. 1 lender in the land,” said Marcie Belles, editor of Auto Finance Big Wheels. “It’s a testament to Ally’s comprehensive strategy to garner share in all segments of the industry.”

The top 10 auto finance companies in the U.S. last year were:

  1. Ally Financial
  2. Toyota Financial Services
  3. Chase Auto Finance
  4. Ford Motor Credit Co.
  5. Wells Fargo Dealer Services
  6. Bank of America Dealer Financial Services
  7. American Honda Finance Corp.
  8. BMW Financial Services
  9. Nissan Motor Acceptance Corp.
  10. Santander Consumer USA

Auto Finance Big Wheels ranks the top 100 car finance companies in the nation by pouring through public documents, receiving data directly from lenders, and by applying a propriety formula for calculating outstandings and originations based on a variety of criteria. The 2011 report is the 12th annual Big Wheels published by Auto Finance Advisors, a consultancy dedicated to providing research and advisory services to the automotive lending and leasing market.

After the credit crisis sent the auto finance sector into a tailspin, the tide was turned in 2010 by a 31 percent increase in loan originations, compared with a year earlier. Toyota originated the most auto loans and leases last year.

“Last year saw the auto finance market resuscitate, and we forecast the industry to truly get its mojo back in 2012, particularly since car sales have taken off so far this year,” said Belles, who is also a principal at Auto Finance Advisors. “The market has a bright future.”

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