TD Auto Finance is focused on deepening its relationships with dealers, according to President and Chief Executive Andrew Stuart.
“We’re leveraging our Priority Dealer program to work with those guys that want to work with us,” Stuart told AFN. “Rather than try to treat everyone equally, if a dealer is sending us a volume of business and they’ve demonstrated that they really want to work with us closely, then they get certain benefits.”
The program provides enhanced products and services — such as benefits in terms of the turn time in TD’s service centers, according to Stuart — that address the unique financing needs of auto dealers.
The program is driven by dealer feedback and is designed to grow and evolve as market conditions and dealer needs change. Part of that evolution includes a coming slowdown in the market, Stuart said.
“We do feel, I think like everybody else does, that we’re at the peak in the market,” he said. “We’ve seen year-over-year gains for approximately six years now, and we’ve seen these kinds of cycle in the past and you start to get to a point where you’re reaching a peak. A high 17 million [SAAR] in the U.S. really feels like we’re at a peak.”
Industry incentives are also ticking up, Stuart said, a sign that manufacturers may be ramping up the competition.
Incentive spending by automakers averaged an estimated $3,225 per vehicle in July, according to TrueCar, up 5.2% from a year ago, though down 0.2% in the same month a year prior.
“So that tells me that manufacturers are perhaps getting a little bit concerned about sales rates,” he said. “Certainly seeing a SAAR of 16.6 million probably caused them to throw some money at the market in July to drive the result that we saw.” Stuart was referring to the July SAAR of 17.8 million units, up from a 16.6 million unit-SAAR in June.
For more auto finance insights like this, register for the upcoming Auto Finance Summit, Oct. 5-7 at Bellagio Las Vegas. Visit www.AutoFinanceSummit.com for more information.
