Third-quarter results for the global captive finance partners of major car manufacturing groups have shown profits dip or remain flat.
BMW Financial Services (BMW FS) increased its global revenues by 1.6% to 4.99bn (£4.19bn) in the third quarter of 2013, helping to bolster the BMW Group’s overall revenue for the three months to 18.75bn.
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Profitability within the financial services group was, however, down 6.4% on the period from July to September 2012. Net profits were 398m compared to 425m for the same period last year.
For the first nine months of the year gross profit within the financial services operation remained positive however, maintaining growth of 2.1% to 14.9bn.
Globally, new contracts signed increased by 14.9% to just under 376,000. This helped the nine-month increase to reach 12.8%, or just over one million contracts, to the end of September and contracts in place worldwide to reach over four million, up 8.1%, by the end of September.
BMW FS is on target to exceed the new contract growth of 1.34 million for 2012.
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By GlobalDataAccording to the BMW Group’s Interim Group Management Report to 30 September 2013, the penetration rate on new cars from Group marques increased worldwide from 39.2% in 2012 to 45% in 2013, "mainly attributable to the high level of new business in the USA". The global book for used BMW and Mini cars added 237,725 contracts during the period, 3.1% more than were added during the same time span in 2012. In total, 3,374,304 contracts were in place with retail customers at the end of September, up 7.8% year-on-year globally and 2.6% for the EU bank regions.
Ford Motor Credit (FMC), the lending arm of US manufacturer Ford reported a net profit of $272m (£168m) for the third quarter of 2013.
The results reveal a 23.38% decline in profitability for FMC and its subsidiaries compared to the $355m profit earned in Q3 last year.
FMC saw an increase in its financing revenue in the third quarter of $75m, from $579m to $654m, but higher expenses at the firm and a larger tax bill of $155m, which compares to $38m for the same quarter last year, drove down profitability in the finance unit.
Before expenses and tax, however, revenue was up from $579m in the third quarter of 2012 to $654m. This was boosted by a 10.97% increase in financing revenue to $2.175bn.
Profitability for the first nine months of the year was also slightly down on 2012 at $911m, a 3.7% drop on last year’s figure of $946m.
FMC chairman and CEO Bernard Silverstone said: "We remain solidly on track for 2013. We are growing along with Ford and continue to offer a full range of financing products and the world-class services that support Ford sales, our dealers and customers."
Renault’s sales financing unit RCI Banque contributed 515m to Renault Group’s third-quarter revenues according to its quarterly statement.
This marks a 0.4% increase in revenues on the same quarter last year and a return to gains after a difficult second quarter for the captive finance provider.
In the three months to the end of June revenues at RCI Banque fell 3.8% to 529m year-on-year.
This has pushed revenues for the first nine months of 2013 down 0.6% compared to last year to a total of 1.57bn.
Overall performance at the French car-maker fell on figures for 2012 by 3.2% to 8bn, in part due to poor revenues from sales of Renault, Nissan and Dacia vehicles.
The finance arm of Renault has outperformed its car sales in all but the second quarter of the year despite a rise in sales at the car-maker.
Average loans outstanding stood at 24.5bn in the third quarter, up 2.5%. The number of new financing contracts rose 25% to 286,300 over the quarter.
While the VW Group reported an operating profit of 8.6bn (£7.36bn) for the first nine months of 2013, total profit of the finance division was broadly flat compared to the same period last year, up 100m to 1.1bn.
Globally, however, new contracts at Volkswagen Financial Services (VWFS) rose 11.2% to 3.1 million for the first three quarters of 2012, taking total new contracts to 10.4 million for the first nine months of the year. Europe accounted for 2.1 million of those contracts, up 7.7% compared to the same period in 2012.
For the year to the end of September, European new contracts rose 7.1% to 7.3 million, of which 3.1 million were commercial contracts.
According to the Volkswagen Interim Report, January-September 2013: "Global demand for automotive-related financial services benefited from continuing strong demand in the period from January to September 2013.
"The situation in the new and used car markets in Europe remained strained; nevertheless, demand increased for automotive-related financial services. Demand in Germany and North America stabilised at a high level. The South American markets recorded steady growth, while parts of the Asia-Pacific region clearly exceeded the prior-year volume."
Total assets of the financial services division at Volkswagen at the end of September stood at 131.1bn, up 2% on the figure at the close of 2012, accounting for 40.5% of Volkswagen Group assets. Deposits from direct banking were up from 23.9bn at the end of 2012 to 24.7bn; of which, 22.7bn was directly attributable to Volkswagen Bank.
