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Stellantis Purchases F1 Holdings Corporation To Form New Auto Lending Unit:

Deal Should Be Completed By End Of The Year...

Stellantis announced yesterday, that the company has entered into a definitive agreement to acquire F1 Holdings Corp., parent company to First Investors Financial Services Group, a leading independent auto finance company in the United States of America, in an all-cash transaction for approximately $285 million, subject to adjustments for closing balance sheet and certain outstanding options from an investor group led by Gallatin Point Capital LLC and including affiliates of Jacobs Asset Management, LLC.

Chrysler, Dodge, Jeep®, Ram dealer lot. (MoparInsiders).

Stellantis’ strategic objective is to establish a U.S. captive finance company to support its sales and fully capitalize on its strong market position while creating long-term value for Stellantis shareholders. The acquisition of First Investors allows Stellantis to create a platform from which to grow a full-service captive finance organization. First Investors is based in Houston, Texas.

Stellantis is the only major OEM currently operating in the U.S. without a captive auto finance company. The transaction represents a meaningful strategic opportunity, with significant potential for accretive earnings generation and improving customer loyalty. A captive U.S. finance company will enhance the ownership experience and connectivity in the digital age for customers who purchase its award-winning Chrysler, Dodge, Jeep®, Ram, FIAT, and Alfa Romeo vehicles, and provide future opportunities to enable emerging business strategies.

Chrysler, Dodge, Jeep®, Ram dealer lot. (MoparInsiders).

Currently, the Chrysler Group has continued to deal with Santander Consumer USA Holdings Inc. which oversees the daily operations for Chrysler Capital. The Chrysler Capital identity was created in 2013, before the merger between Chrysler and FIAT to offer lending services for Chrysler Group vehicles. The acquisition of First Investors doesn’t look good for Santander, although it is saying that it will have “ongoing conversations with Stellantis about long-term mutually beneficial opportunities beyond 2023.”

Santander’s U.S.-listed stock fell almost 1.5% during trading on Wednesday after Bloomberg reported that Stellantis was going to announce the acquisition of First Investors. Stellantis stock, on the other hand, rose 1.3% in Paris after the announcement was made.

Chrysler, Dodge, Jeep®, Ram dealer lot. (MoparInsiders).

During the last quarter, which ended in June, Chrysler Capital stated that it financed 33.8% of Stellantis’ vehicle sales in the United States during that time. That means that Santander is one of the biggest providers of loans to those who borrow with less-than-perfect credit in the U.S.

“This transaction marks a significant milestone in Stellantis’ sales finance strategy in the critical U.S. market. First Investors has an outstanding financial and operational platform, underpinned by a strong management team, with vast experience in the auto finance space,” said Stellantis CEO, Carlos Tavares. ”Direct ownership of a finance company in the U.S. is a white-space opportunity that will allow Stellantis to provide our customers and dealers a complete range of financing options, including retail loans, leases, and floorplan financing in the near-to-medium term.”

A 2021 Jeep® Grand Cherokee L Limited 4×4 being loaded onto a car carrier. (Stellantis).

“We are excited to join the Stellantis team. Becoming part of Stellantis provides long-term stability for our company and employees. We believe that there are significant untapped growth opportunities for First Investors under Stellantis ownership as we expand our product suite to support the auto sales growth of Stellantis,“ stated Tommy Moore, Jr., President & CEO of First Investors. ”The First Investors management team is fully committed to ensuring a smooth and rapid integration into Stellantis. Meanwhile, we remain committed to continuing to offer our loans and services to our existing network of dealers and current business partners.”

The deal is expected to close by the end of the year and is subject to the customary closing conditions and regulatory approvals.

Jared B

Jared founded MoparInsiders and is a 36-year-old automotive enthusiast from Vancouver, British Columbia. He took an interest in cars at a very young age and has been interested in them ever since. His hobbies include photography, videography, drag racing, and auto detailing. He currently owns and drives a 2021 Dodge Challenger SRT Hellcat Redeye and rides a 2017 Kawasaki Ninja 650.

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Can someone clarify this quote

During the last quarter, which ended in June, Chrysler Capital stated that it financed 33.8% of Stellantis’ vehicle sales in the United States during that time. That means that Santander is one of the biggest providers of loans to those who borrow with less-than-perfect credit in the U.S.

Does CC only lend to those with lower credit scores or low asset to debt ratio ?

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As a Stellantis investor I am more confident in my return on that investment in the long term. This acquisition is another step forward, apart from vehicle development, that signals maturity of the company to a global corporation of serious intent and capability. This merger has given the Chrysler Group much greater assets to lead the domestic market with a full range of brands and vehicles that was unachievable before. Along with the news out of Brazil my spirits of financial security have been lifted. Now, when are my new Chrysler’s coming ? I’m riding on a Mopar high today.

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Can someone clarify this quote

Does CC only lend to those with lower credit scores or low asset to debt ratio ?

No:, that 'quote'' is from David Welch, a reporter that tend to carry GM's water.

He conflates two different things.
First Santander has large used vehicle financing business (think ''unaffiliated dealers'') that is large on subprime vehicle loans.
That has nothing to do wth the Stellantis.

The second thing he is conflating is kind of perception related. Me and @TripleT in many of different postings have mention the 2015 change in direction. The retail buyers who purchase RAM Single-cab ,Journey ,Darts ,Avengers, 200, Grand Caravan, Patriot, etc tend to need more risker lending vs the rest of the U.S. New Auto market. Obviously with the 2015 direction in North America this no longer the case.

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The issue with this is they can make more money off the financing than the cars themselves, its why Sergio scrapped it and voila, the cars got better 10 fold. Nobody has ever had an issue financing a chrysler, the F&I guy inputs your info and about 15 banks pop up with their rate begging for your business - this is not a good thing.

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The issue with this is they can make more money off the financing than the cars themselves, its why Sergio scrapped it and voila, the cars got better 10 fold. Nobody has ever had an issue financing a chrysler, the F&I guy inputs your info and about 15 banks pop up with their rate begging for your business - this is not a good thing.

In case of Honda in the recent decade that’s true (more made leasing/financing vs manufacturing vehicles).
That won’t be the case (for Stellantis) given the billions Stellantis will invest and billions to fund the it. Stellantis has high strong margins profitability so that case won’t happen.

It wasn’t Sergio’s decision to not to have a in-house financing company:it Was Daimler’s when they ”scraped” Chrysler Financial of many of its assets & infrastructure leaving behind “straps” for Cerberus whom immediately pull back on financing because the “straps” called Chrysler Financial wasn’t funded & didn’t have proper liquidity.

Government bailed out Chrysler Financial so they could continue Wholesale/Floorplan/Inventory lending while transitioning to GMAC/Ally Financial

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