GM captive finance company GM Financial reported a drop in retail loan and lease originations in the fourth quarter of 2025, partly in keeping with an overall industry sales slowdown, and partly because GM soft-pedaled some incentives, according to the captive’s latest quarterly report.
“GM Financial also had another strong year of profitability and capital returns to GM,” said GM CEO Mary Barra in an earnings conference call Jan. 27.
The quarterly report included some good news for dealers: an increase in off-lease returns available for dealers to purchase at wholesale auctions and resell at retail. More on that later.
GM Financial net income for the full year was about $2.1 billion, up 10.6% vs. 2024. For the fourth quarter, GM Financial net income was $460 million, more than double the fourth quarter of 2024.
The year-ago comparison is distorted by a one-time write-down of $320 million in the fourth quarter of 2024 for GM Financial related to the fair value of its equity investment in SAIC-GMAC, a joint venture in China.
Meanwhile, fourth-quarter originations for GM Financial, including retail auto loans and leases, totaled $12.6 billion, down 18.9% from a year ago. For all of 2025, originations for the captive finance company totaled $55.9 billion, down 0.3% and nearly even with 2024.
That annual total doesn’t sound bad, but GM Financial was farther ahead through the first three quarters of 2025. Year to date after three quarters, GM Financial originations were $43.2 billion, up 6.9% vs. the same period a year ago.
From the dealer point of view, the captive finance company’s U.S. retail loan share of total GM business reflected the fourth-quarter slowdown. In the fourth quarter, GM Financial share of U.S. retail loans was 31%, down substantially from 43% in Q4, 2024.
GM Financial said in an earnings presentation the share decline was “driven by type and level of incentive programs offered.”
U.S. lease originations also fell in the fourth quarter for GM Financial, driven by lower GM retail sales in general and lower lease share. EV leases also declined in the fourth quarter, following the expiration of tax credits for EVs.
An important upside for dealers is that GM Financial reported an increase in sales of off-lease units, and an increase in the return rate to GM Financial, making more off-lease units available to dealers for resale.
Off-lease units are 3 years old on average, and fetch a premium price compared with older cars. Off-lease units are often retailed as Certified Pre-Owned. CPO units are reconditioned to comply with a factory checklist, and come with an OEM warranty as well as the unexpired portion of the original warranty.
U.S. off-lease sales for GM Financial in the fourth quarter were close to 20,000 units, up from just over 15,000 a year ago. The return rate in Q4 2025 was 33%, up from 27% a year ago.
For context, the off-lease return rate for GM Financial was 77% in the fourth quarter of 2019. That was before the COVID-19 pandemic and the lingering shortage of new and nearly-new cars drove used-vehicle prices to record highs in the 2021-2022 time frame.
That made it a bargain back then for customers or their originating dealers to purchase off-lease vehicles at contracted residual values which turned out to be too low.
While the return rate is still low by historical standards, it has gradually increased lately. At present, used-vehicle prices for more models are closer to the contracted residual value, or even below the contracted residual value, GM Financial reported.
Lower street values for some off-lease vehicles, relatively speaking, motivate more customers and their dealers to return their off-lease units to the captive, rather than pay the contracted residual value.
