Chrysler in talks to tap Santander as preferred financing provider, report says
DETROIT (Bloomberg) -- Chrysler Group is in exclusive talks with Banco Santander SA to make its U.S. unit the automaker's preferred financing provider, people familiar with the matter said.
Chrysler entered a 30-day negotiating period with the lender, which would be the U.S. automaker's main partner for financing with customers and dealers, said the people, who declined to be identified because the negotiations are private.
Sergio Marchionne, the CEO of Chrysler and Fiat, said at the Paris auto show in September that Santander Holdings USA and JPMorgan Chase & Co. were "possible" financing partners for Chrysler.
The automaker said in April that it would let its preferred-lender agreement with Ally Financial Inc. expire in April 2013.
The pact with Detroit-based Ally requires Chrysler to allow Ally to finance a minimum percentage of vehicles sold with subvented loans, which are those made to consumers at below-market rates.
Automakers pay lenders to make up the difference.
The expiring accord doesn't cover other business Ally does with Chrysler dealers, such as wholesale financing, so-called standard-rate financing for consumers or leasing.
Laurie Kight, a spokeswoman for Santander, didn't immediately respond to messages left by telephone or e-mail.
Chrysler, the No. 3 U.S. automaker behind General Motors Co. and Ford Motor Co., generates more than $25 billion in auto loans annually, people familiar with the matter said in February.Contact Automotive News