Reports: Santander Nears Deal to Become Chrysler Captive

Santander Consumer USA’s relationship with Chrysler Group may get a big boost in the coming weeks, as the financier nears a deal to become the OEM’s captive, according to published reports.

Chrysler is reportedly close to striking a deal with Santander Consumer USA’s parent, Spanish lender Banco Santander, to establish an in-house financing arm through a joint venture. The new entity, which would replace Ally Financial, would be called Chrysler Capital, according to people familiar with the plan.

Santander Consumer USA has been financing Chrysler vehicles for subprime customers since 2010. In the past two years, Chrysler and Santander have expanded their relationship. Santander has continued to mine its data and fine-tune its originations model to buy deeper and put more Chrysler customers in new cars.

In September 2012, Santander announced a plan to buy DriveTime Automotive Group’s $700 million portfolio of finance receivables, but the deal was scrapped two months later.