Santander Consumer Finance is set to launch a motor financing operation in China in a joint venture with Anhui Jianghuai Automobile Company (JAC), starting with 58m in initial capital.
Each company will hold a 50% stake in the new company and nominate three of the six board members. Santander will appoint the general manager and JAC, the seventh-largest car manufacturer in China, will nominate the chairman.
The move gives Santander Consumer Finance access to JACs network of over 1,000 dealerships throughout China in a market of 18 million annual vehicle sales. Currently, Santander Consumer Finance facilitates the purchase of 1.3 million vehicles a year in the 14 countries in which it already operates.
In the UK, Santander Consumer Finance supplies car finance for Hyundai, Kia, Mazda and Volvo brands, as well as providing independent finance for new and used cars through its dealer network. Since 2009, the company has been operating an auto loan portfolio for GE Money.
China is a huge market, said a spokeswoman for Santander speaking to Motor Finance. Through its consumer finance arm, Santander has huge expertise in the European and US markets. China is a market of opportunity if you can go into it with someone of experience such as JAC.
The independent operation will be open to finance other passenger brands in China and Santander does not expect the venture to impact its other markets, staff or revenue outside China.
We put together a local company with local expertise. Its the banks model. The spokeswoman added.