Captives gain stature among auto execs

Captive finance companies got high marks in the latest KPMG survey of top-ranking auto executives.

“Captive finance is becoming an increasingly important part of the value proposition for consumers and OEMs alike,” said Gary Silberg, Chicago-based national automotive industry leader for KPMG, headquartered in New York.

“We continue to see significant investment in this area,” he said last week.

A total of 200 auto executives participated in the survey, representing vehicle manufacturers, suppliers, dealers, captive and noncaptive financial service providers and others. More than half of respondents were business unit heads or higher.

Specifically, Silberg said last week that in the survey, officially titled “KPMG’s Global Automotive Executive Survey 2013,” captive financing increased in importance over 2012 results in several areas.

For instance, he said, 54 percent of respondents rated OEM captive financing and leasing either “extremely important” or “very important” as a key automotive trend, Silberg said, more than double last year’s 26 percent. And 71 percent of survey respondents this year rated operating a captive finance company as important to an OEM’s future success, up from 64 percent in 2012.

Also in 2013, 82 percent of survey respondents rated “competitive financing options” as either “extremely important” or “important” to consumer vehicle purchasing decisions, up from 60 percent last year.

“I was surprised,” Silberg said of captives’ growing stature among respondents. Captive finance, he said, “is an interesting area, but it was never that significant in the survey.”