Santander Consumer USA has a three-pronged plan for growth in 2017, said Rich Morrin, SC’s chief operating officer, during an analyst and investor day event, yesterday.
“We know hope isn’t a strategy, we have specific things we’re working on in 2017, most importantly around Chrysler,” he said. “Chrysler continues to represent an opportunity for growth for us, [but] it can’t be growth at any cost, it has to be disciplined growth with the right risk-adjusted returns and the right profitability. We think we have a plan on how to execute that effectively, it’s focused on three key areas.”
The first part of SC’s plan is to continue to roll out its VIP program to Chrysler dealers. The program is “important” because it will help the company choose which relationships to grow, Morrin said. “It’s a critical path for us,” he said. “So far we’ve seen — on dealers we’ve rolled it out to — much better penetration rates and performance metrics.”
Currently, the company has 1,000 dealers on the program, and hopes to onboard its outstanding Chrysler dealers in the next two quarters, Morrin said. The second part of SC’s plan is to continue to grow its floorplan business, which gives the company the opportunity to earn more consumer loans and leases, “but you generally get better performance from that population,” he added.
Lastly SC plans to execute on its flow agreement with Banco Santander, which will allow the company to fund more prime originations, Morrin said. “The competition for prime and near-prime assets is intense,” Morrin said. “By partnering more closely with Banco Santander, we believe we’ve put ourselves into a much better position [for the future], relative to where we are today, which will allow us to try to grow those assets the right way.”
