Ally Financial Inc. was not surprised that General Motors Financial Co. wanted to grow as a captive, but it didn’t expect to be excluded completely from competing in the General Motors lease program, Ally Chief Executive Michael Carpenter said during the bank’s fourth-quarter earnings call last week.
“It’s up to GM to decide what they want to do,” Carpenter said. “I personally don’t think having one captive for leases will help you sell cars, they obviously think differently. OEMs have a way of zigging and zagging until they get it right.”
Carpenter was referring to a mid-January announcement that called for GMF to be the exclusive provider of subvented leases for Buick and GMC dealers, a business that had primarily been offered through Ally and U.S. Bank. Leases for GM vehicles accounted for $5.2 billion of Ally’s 2014 originations, according to the company’s earnings. The company said it planned to make up the loss from GM subvented leases by building up its non-GM vehicle loans in 2015.
“I don’t want to communicate that we don’t care about GM,” Carpenter said. “The success of the leasing program has everything to do with the support we’ve given them, and we’re going to continue to be supportive. But you should expect us not to have too many eggs in one basket. We want to have eggs in enough baskets so we don’t feel vulnerable.” OEMs can only control leasing and subvented lending, he said. Beyond those segments, carmakers have to compete with Ally and other companies. “I have a very simple view of the world: We’ll compete with anyone on a heads-up basis,” Carpenter said. “What pisses us off is when we don’t get a chance to compete on a heads-up basis.”
