Ally Financial plans to hire 200 people this year, in part to help auto dealers arrange customer loans faster.
“We want to put more bodies on the credit desk, people who can talk to dealers and their finance and insurance managers,” Mark Manzo, Ally vice president-alliance sales, tells WardsAuto. “It takes people to provide high-touch service and get to ‘yes’ and get there quick.”
Subprime lending often requires more interactivity between a lender and a dealer trying to facilitate a loan for a customer with credit issues. But even loan applications for consumers in good credit standing can require further lender-dealer discussions about properly structuring a deal.
“You may have a person with a high credit score who is looking for a high advance on an expensive car,” Manzo says as an example of extra-treatment needs. “You can lose big on superprime if you don’t structure the loan properly.”
The addition of 200 sales and underwriting staffers broadens Ally’s reach, says its president, Bill Muir. “We help dealers of multiple brands sell more cars and trucks. We do that by providing expertise on the ground and at the underwriting desk.”
Like other lenders, Ally uses technology such as automated-decision making in the course of doing business, but more “live” representatives offer a competitive edge, Manzo says.
When the recession hit, many financial institutions bailed from auto financing, particularly nonprime and subprime segments. But automotive lending did reasonably well during the tough times, seeing a relatively low level of defaults and delinquencies. That’s because many borrowers pay their car loan before other debts.
“The reality is that auto financing outperformed other segments,” Manzo says, adding that Ally saw 18% growth last year and “continues to look for ways to incrementally grow the business.”
For the second year in a row, Ally ranks No.1 in U.S. financing consumer auto sales, according to Experian Automotive’s AutoCount.
Ally financed nearly 1.5 million new and used vehicles through franchised and independent dealers in 2012. It had nearly $39 billion in consumer auto financing and $32.5 billion in commercial auto assets outstanding going into this year.
In an Ally poll, dealers express optimism that auto sales will keep climbing in 2013. Nearly 60% of 100 surveyed dealers expect their sales to increase more than 10%, according to the poll taken at the recent National Automobile Dealers Association Convention in Orlando, FL.
More than 54% of surveyed dealers think consumer confidence will sustain sales momentum this year. About half say customer credit profiles are improving.
“We expect 2013 to be a strong year for the auto industry, as the economy and consumer credit profiles steadily improve, and as new models attract customers to showrooms,” says Tim Russi, Ally Financial’s president-auto finance.
Used-vehicle operations will show the most profits within dealerships this year, say 47% of the polled dealers. More than 70% expect an increase in sales of F&I products, such as vehicle service contracts.
Ally is amping up its online training to help dealership staffers increase sales, improve financing effectiveness and enhance the overall customer experience.
Last year, more than 12,000 dealership staffers took Ally courses on subjects such as F&I management and leasing, one of the most popular.
Training helps dealership personnel stay up to speed “while honing their overall sales and business skills,” Russi says.
The courses also allow Ally to highlight its offerings. “You can have the best products in the world, but it doesn’t matter if dealers don’t use them,” Manzo says.
Training content now is integrated into a single platform. Courses are offered to Ally customers and non-customers alike. The online lessons strive for conciseness and brevity, says Kathy Ruble, Ally’s director-alliance sales and performance development. Participants “will sit for 12 to 18 minutes, but not six hours.”
