NASHVILLE — Chase Auto remains optimistic about its electric vehicle private-label businesses on the heels of Fisker pausing production and facing potential bankruptcy.
Electric vehicle players will continue to be a part of Chase Auto’s private-label strategy, Leslie Wims Morris, president of private-label captive finance at Chase Auto, said during a fireside chat at Auto Finance Summit East 2024 today.
“Our view is there is going to be many [EV] participants within the industry, ultimately,” she said. “We don’t know who the winner is going to be, but we are going to work with all of them. That’s our formal position.”
Chase formed Fisker Financial Services in 2022 and has a private-label relationship with EV maker Rivian Automotive. The lender also has private-label partnerships with traditional OEMs such as Subaru, Jaguar Land Rover, Maserati, Aston Martin and McLaren.
Private-label makes up about 50% of Chase Auto’s business, Wims Morris said.
“One of the benefits of being the No. 1 private-label provider in the market, based on number of partners and outstandings, is you get the opportunity to look at everything,” she said. “When you look at the lives of Rivian and Fisker, what makes them unique … is their business model, which is direct-to-consumer. That is a structural change in the marketplace.”
Fisker, facing liquidity challenges and failed OEM negotiations, reduced the price of its only model by 39% in March as it looked to stay in business.
The challenge for EV makers lies in managing factory capacity to produce high-quality vehicles fast enough to meet demand, Wims Morris said.
“Rivian and Fisker are on two different ends of the spectrum in terms of where they are and their ability to scale,” she said.
Fisker came into the market at a challenging macroeconomic time, Wims Morris said.
“In [Fisker’s] particular case, they took a different approach to the market where they don’t own their own manufacturing, so everything is outsourced,” she said. “If everything is outsourced … and we have all these [challenging] dynamics, a lot of things have to be perfect.”
Chase Auto remains “bullish” on EVs, Wims Morris said.
“We stand by our partners no matter what,” she said. “Rivian and Fisker will be the first of many pure-play [EV companies] in the market who are going to make a run of it.”
