Stellantis’ fledgling captive financial services company, serving dealers and consumers in the U.S., is beginning to sprout wings.
Stellantis CEO Carlos Tavares notes during a conference call with analysts discussing 2022 earnings that 90% of the automaker’s dealers in the U.S. have signed on with Stellantis Financial Services U.S.
Roughly 80% percent of Stellantis’ sales volume in the U.S. will utilize the in-house company.
“We were blessed to create the Stellantis U.S. Financial Services from the acquisition of an existing entity,” Tavares says.
Financial services is one of seven service-oriented businesses Stellantis expects to expand by 2030 under its “Dare Forward” plan, which the automaker outlined last year.
Tommy A. Moore Jr., president and CEO of Stellantis Financial Services U.S., says SFSUS is now a wholly owned subsidiary within the Stellantis Group.
SFSUS, which is based in Houston, is now operational, Moore notes via e-mail. It offers retail loans across the credit spectrum and is in the process of ramping up its lease product, he adds.
“We are growing quickly, having more than doubled in size in the last year,” says Moore, who joined Stellantis after serving as CEO of First Investors Financial Services. “You will start to see promotional material for SFSUS at our dealerships.”
Stellantis acquired Texas-based First Investors Financial Services for $285 million in 2021 to serve as the foundation and provide the infrastructure for its new captive finance unit.
Prior to its acquisition by Stellantis, First Investors had operated 32 years as an independent auto finance company engaged in originating and holding for investment automobile finance receivables and promissory notes originated by dealers or through refinancing transactions with vehicle owners.
For Stellantis, the strategic goal was to establish a captive finance company in the U.S. to more fully capitalize on auto sales growth.
At the time, automaker noted, Stellantis was the only major company selling vehicles in the U.S. that did not have its own captive finance company.
The old Chrysler Corp., which was folded into Stellantis through the Fiat Chrysler merger with PSA Group, had been stripped of its captive finance company when it was strapped for cash during the 2008-2009 financial crisis. The unit was sold to Toronto Dominion Bank and other financial services firms.
FCA, under the late CEO Sergio Marchionne, had said publicly in 2018 it planned to develop a captive financial services arm, but the effort was not finished until it was revived by Stellantis.
In setting up its captive finance company, Stellantis borrowed from a playbook established by General Motors, which acquired AmeriCredit Corp. in October 2010 and renamed it General Motors Financial Company Inc. GM Financial replaced General Motors Acceptance Corp., which was spun off during the financial crisis and now operates as Detroit-based Ally Bank.