The Trust Factor
Trust is the foundation of great relationships, and auto finance is no different. “Having a relationship that is basically only a commodity will not work long term for the dealer or the lender,” Bruce Jackson, head of dealer services for Chase Auto, told AFN. “In terms of pricing and structure, looking short term can create challenges when times get tougher,” Jackson said. “It is critical for both parties to have a full appreciation of the other one’s needs and think long term.”
To create that relationship, Chase Auto sees its role as an advisor to the dealer, not just as a lender, Jackson said. “We do this by truly bringing all the firm offers to our clients from treasury and merchant services to card, retail, and mergers and acquisitions,” he said. On the consumer side, Chase Auto prioritizes the dealer in every strategy or program it builds, Jackson said. “As we think about solutions for direct customers, we fully understand that all roads lead back to the dealer.”
Customer experience is seen as the key to attracting and retaining dealers and consumers in an increasingly digital world. To that end, U.S. Bank focuses on a customer-centric mentality. “We try to constantly engage with our dealers with different venues and different formats to really find out what’s on their minds,” Sullivan said. “They are the customers.”
To facilitate its strategy, the prime lender engages with its dealers regularly. “[U.S. Bank] conducts roundtables where we invite our dealers in to give their views of what’s working well or what could work better,” Sullivan said.
The bank also focuses on a broader industry perspective. “It’s a very dynamic and shifting marketplace, and how the customer wants to engage and buy automobiles is changing quite often, so other ways to finance those automobiles will be changing, as well,” Sullivan said. “We’ve got to make sure we’re in touch with our dealers and give them the tools to be successful.”
U.S. Bank structures it business so that underwriters and the sales team are accessible to dealers at a moment’s notice. “If there’s a problem, [the dealer] can pick up the phone and get in touch with the [underwriter or sales team] right away,” Sullivan said. “If you ask a dealer, ‘What makes a lender successful?’ It’s going to be the relationship the dealer has with the individuals across the board. And that’s sales and underwriting.”
Enhancing sales and underwriting are where technology steps in, but the question looms of how lenders can keep dealer partners happy while simultaneously automating processes and preserving a human connection. “What came to mind for me is building and maintaining trust with the dealers,” said Jim Murray, president of Western Funding.
The subprime lender set plans in motion to adopt e-contracting late last year, following parent company Westlake Financial Services, to further improve the dealer funding process. “As technology enables dealers to execute better, and customers to understand better, what we really want is to ensure that our program makes it as easy as possible for all stakeholders to do business with Western Funding,” Murray said.
Dealers share lenders’ sentiments when it comes to trust, and acknowledge that the road goes both ways. “I think we are in the business where we have to work together,” said Paul Ritchie, president of Hagerstown Honda and Kia. “[Lenders] have to be able to trust us because they’re making financial decisions. If you lie to them, it’s like lying to your parents. Sooner or later, they’re going to find out.”