ORLANDO – From staying afloat in a sea of increasing competition and building and maintaining dealer relationships to being compliant and keeping current with technology, there are many challenges facing auto finance companies these days.
“Technology is definitely moving faster than we can consume,” Dawn Martin Harp, president of Wells Fargo Dealer Services, said during Friday’s CEO panel at AFSA Vehicle Finance Conference. “I think that’s one of the biggest challenges as a leader – how do I prepare my team, and figure out what is the right thing to focus on.”
On the heels of the 2012’s strong auto sales, increased consumer confidence, and growing credit availability, can lenders breathe easier now more than ever?
“I worry that interest rates going up, more regulation, and consumers being more knowledgeable will all have an effect on this industry,” said Nick Stanutz, auto finance, asset backed lending and commercial real estate group executive at Huntington National Bank. “The fundamentals of the business will not get any better than they are today.”
Mark Kaczynski, president and chief executive of Nissan Motor Acceptance Corp., agreed, pointing out the way changing dynamics are influencing the industry. “We understand how we operate in today’s environment, we’ve learned to live in that environment, and still be profitable in that environment,” he said. “There is change coming, but I think as an industry, we’ll figure out how to deal with that environment. We’ll have more choice; the competition is a great thing for consumers and for auto industry sales we’re seeing.”
As the industry continues its regrowth, lenders are getting smaller slices of the proverbial pie, and Stanutz thinks the industry should be able weather the storm as the pie gets bigger. “We’ll continue to see people willing to take less profit and more risk, and we’ll see if that strategy was the best decision to make.”
“The past isn’t necessarily an indicator of the future, but we can’t forget it,” said Bernard Silverstone, chairman and CEO of Ford Motor Credit. “We’ll focus on strength of compliance and building relationships – we’ve all got the same business model.”
Learn more about this at Auto Finance Risk Summit 2013, register here.