How Lenders Can Translate U.S. Practices to China’s Marketplace

Many lenders look to China and assume that if the country can achieve financing penetration rates north of 75% as the U.S. market enjoys, then it will quickly become the largest market in the world.

But that’s not a realistic model for growth in China, Chas Roscow, an auto finance consultant, told Auto Finance News.

“We can’t simply take 75% of 1.3 billion as China’s potential for auto finance production,” he said. “China’s largest cities could not handle more vehicles on the road and traffic must be managed.”

Roscow, an industry executive with more than 35 years of experience, joined AFN for a special podcast to discuss auto finance best practices in the U.S. and how they can be translated to the Chinese market.

He’ll be speaking at the Auto Finance Summit Asia, which will be held on September 5-6 at the Grand Hyatt Shanghai.

For context on the population difference, the U.S. has a total population of around 320 million with some of the worst traffic in New York City, which has a population of 9 million. Compare that with China’s 1.3 billion total population including 24 million just in Shanghai, and there quickly forms a recipe for traffic congestion.  

In this podcast, Roscow discusses how lenders looking to make their mark in China can best prepare for these demographic differences by watching for profitability, controlling residual values, and mitigating losses.

Check out the podcast below and for more information on the Auto Finance Summit Asia visit www.autofinanceasia.com or click here to register.