General Motors’ financial arm GM Financial, better known as GMAC, has been through some turbulent years. It was spun off from General Motors and sold to a private equity firm, changed its name to Ally Financial, and lost the exclusive relationship in Europe with many of its dealers. But the company’s decision to shed its mortgage businesses during the bad times allowed the firm to focus once again on the core motor finance side of its business.
In April 2013, Ally once again became GMAC. In the interim, however, Vauxhall, the U.K. arm of GM, began to use Santander as its dealer finance provider, and across Europe, the use of GM Financial’s finance product began to wane across the Opel dealerships.
Erhard Paulat, chief operating officer of GMAC, believes this period did no lasting harm to the reputation of the financial operations. “I think following the acquisition in April 2013 for the European businesses and then from the fourth quarter onwards, being the exclusive provider on any manufacturer-subsidized product was welcomed by the vast majority of the network,” he said. “If you ask a Vauxhall dealer today, speaking about the U.K. for a moment, I think generally the view among our dealer partners would be that they appreciate that we have remained focused on auto finance and serving their needs and the needs of their customers and worked with them through the turbulent times.”
In the final quarter of 2013, GMAC was again given the exclusive rights to provide for the U.K. dealership — a situation, Paulat said, that has given the company a “buoyant” business.
On the continent, the situation has been slightly different. “The acquisition by GM last year made us a finance partner for additional dealers, so we have seen a pick-up in customer numbers,” Paulat said. “For example, in Germany now we have 96% of the dealer network committed to doing business with us in 2014 through our dealer volume plan commitment.”
