Subprime lenders are busy with a number of new initiatives.

Credit Acceptance Corp., based in Southfield, MI, followed up a pilot program by creating two business units to expand activities in used-vehicle leasing. They are AutoNetFinance.com, a Web site, and CAC Leasing, Inc.

Donald A. Foss, chairman and CEO of Credit Acceptance since its establishment in 1972, said he anticipates that leasing "could become a more significant part of the company's overall operations."

The firm embarked on the leasing initiative to help offset a two-year decline in revenues. Its 1999 revenues of $116.1 million compare to $142.3 million in 1998 and a company peak of $164.2 million in 1997.

That downturn reflects the financial shakeup experienced in the subprime industry a couple of years ago when loans were loose, leading to defaults and lending house failures.

But Mr. Foss says the company's future is optimistic "on the basis of services provided to its participating dealers, innovative products and superior collection performance."

In Arlington, TX, near its headquarters city of Fort Worth, AmeriCredit Corp. opened a $35 million three- story operations center covering 250,000 sq.ft. The center employs 700 and is expected to double that total to about 1,500 by 2004.

AmeriCredit became Chase Manhattan Bank's only nonprime lending partner in 1999 and launched a direct lending initiative for its customers, effective with their next vehicle loans.

"The subprime market continues to grow at a steady 6% to 7% rate from a nearly $200 billion total in 1998 out of more than $600 billion of auto loans and leases," says AmeriCredit's vice chairman, president and chief operating officer, Michael R. Barrington.

WFS Financial, after notching record earnings of $14.8 million in the first quarter, reported that its parent company, Westcorp., Inc., both headquartered in Irvine, CA, is distributing to its shareholders subscription rights to buy additional shares of common stock at a discount price.

WFS experienced growth, as well, in the first quarter of this year, boosting new auto contract originations 29% to $970 million from the preceding year. Total revenues for WFS in the period rose to $85.4 million from $74.7 million.

Joy Schaefer, CEO of WFS, says its continuous portfolio rise to a $5.7 billion total as of March 31, due to "strong dealer relationships" and "continual process improvements."

What are gas masks and charts headed "The Spectrum of Stink" doing in ads of a major F&I provider?

They're there as visual aids with a pungent headline that reads:

"Everybody loves that NEW CAR SMELL. It's BUYING and FINANCING new cars that STINKS."

The ads, published in high-circulation consumer magazines, were sponsored by Giggo.com, the all-brand U.S. financing subsidiary of DaimlerChrysler-owned debis Financial Services, Inc.

The ad starts out, "Mmmmmmmmm, no one can resist that new car aroma. But have you ever heard anyone talk positively about all the crap you have to go through to buy a new car?"

GMAC's 11th annual National F&I Conference drew more than 500 F&I managers and spouses, who were shown ways of improving service contract sales, keeping abreast of leasing changes, sharpening their sales skills and tuning into the Internet.

Leasing session presenter Matt Hash focused on leasing alternative payment plans. One is the single- payment SmartLease Plus as a cash conversion technique. Another is odd-term durations to meet specific payment requests unable to be accommodated in 36 or 48 months.

Shannon Schumann, F&I manager of Cadillac West, Las Vegas, NV, suggests that GMAC be more competitive in the luxury-vehicle lease field. She says competitors often offer reduced monthly payments with higher residuals that top Cadillac.

"That's commonplace in a high lease market like Vegas,"she says.

GMAC's SmartBuy balloon-note loans, dominant in states like Texas, which impose their property tax on leased vehicles, were cited by several trainers and F&I managers as often a more viable option because the owner retains title, and the vehicle may be resold to the lender without additional sales tax in most states.

Dan Boone, F&I manager of Houston's Beck & Masten Pontiac-GMC, says GM SmartBuy loans "have taken over the financing volume at our store that used to go to leasing, with more owners refinancing their balloons than used to re-lease."

Theme of the 2000 conference was "Navigating Technology,"a title which embraced state-of-the-art electronic applications and contracts.

Honored for top GMPP service contract sales in 1999 were James Wood Autoparks, Buick-Pontiac- Chevrolet-Cadillac, Decatur and Denton, TX; Billy Navarre Chevrolet, Lake Charles, LA; Classic Chevrolet, Grapevine, TX, and #1 Cochran Pontiac, Monroeville, PA.