SCF to take over
white-label arrangement with Black Horse.
Go deeper with GlobalData
Hyundai is set to launch a UK
finance joint venture with Santander Consumer Finance UK (SCF), to
start transacting business within the next 24 months.
The move will see SCF take
over Hyundai’s current white label finance arrangement with Black
Horse, the Spanish-owned provider’s biggest rival. However, a
spokesperson for Lloyds Banking Group, owner of Black Horse, said
they could not comment at present.
The news has emerged after a
meeting between Hyundai Motor Company chairman Chung Mong-koo and
Banco Santander Chairman Emilio Botin in Seoul, aimed at forging a
strategic partnership between the two groups in Europe and Latin
America.
It is understood that the
deal between SCF and Hyundai has not been formally signed yet, but
is approaching completion in the next few weeks.
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By GlobalDataLast year, Black Horse
trading as Hyundai Car Finance funded around 17% of Hyundai’s
62,000 vehicle sales in the UK.
Hyundai UK managing director
Tony Whitehorn expects that under the new arrangement, this figure
would be increased to 40% within three years.
Other finance providers will
see some more Hyundai business too.
At present, around 13 to 15%
of Hyundai’s total sales are funded by Barclays Partner Finance,
SCF and Black Horse (outside its participation in the Hyundai Car
Finance programme).
According to Whitehorn,
Hyundai would like to see this proportion rise to 20%, as part of a
general push to achieve more sales through finance.
“Currently about 70% of our
sales are financed by cash, bank loans and other means, whereas
under our plans this percentage will reduce to about 40%,”
Whitehorn said.
“We are pushing heavily on
finance – we will promote it more and more.”
Whitehorn is also bullish
about his ambitions for PCP business.
“Of the 17% of business that
Hyundai Car Finance currently writes, only 20% is PCP,” he
stated.
“That will change. Of the 40%
share we are aiming for, we want 70% to be PCP.”
Hyundai is strengthening its
foothold in the UK market.
In 2009 it doubled sales on
the back of scrappage, selling a record 56,000 vehicles. Last year
it did even better, selling 62,000 vehicles and breaking through
the 3% market share barrier.
SCF currently runs the UK
finance programme for Kia, the other brand owned by Korea’s Hyundai
motor company.
While Santander currently
funds Hyundai vehicles in several European territories, this deal
will be the first formal joint venture in which Hyundai shares risk
and reward with the bank.
SCF also runs the UK manufacturer finance programmes for
Mazda and Volvo.
