Chery Automobile Will Offer Auto Financing
By David Surace
According to an article in Automotive News (sub req’d), Chinese automaker Chery has announced that they’re all set to introduce a domestic automotive financing service, with an initial capitalization of 500m yuan, or around $73 million USD, to help stir the pot.
This certainly isn’t the first financing to be offered through an automaker in China–GM and Volkswagen, among others, have offered such for years–but it is the first to be underwritten by a Chinese-owned-and-operated financial institution, in this case Huishang Bank in eastern Anhui province, near Chery’s headquarters in the Wuhu region. The nine other automotive financing entities that currently operate in China are all foreign-owned.
Chery Automobile will control 80% of the financing concern, with Huishang Bank taking care of the remaining 20%.
What this specifically means for consumers in the world’s second-largest automotive market is that Chery–still a government-owned company, and at this point the largest Chinese auto manufacturer, having sold some 381,000 vehicles last year–can now take control of a huge chunk of their customers’ buying experience, through a dealership process we already know and love: F&I (financing & insurance).
Viewed in that light, the 500 million yuan Chery and Huishang have sunk into this venture could be seen as marketing money well-spent.
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