UPDATED: 4/10/14 10:52 am ET - corrected
Editor's note: An earlier version of this story incorrectly said that Nissan Motor Acceptance Corp. was an e-contracting customer for RouteOne LLC.
RouteOne expects to more than double its electronic contract volume this year, to an estimated 1.6 million contracts, after more than tripling volume last year.
The growth is coming from more lenders signing up as well as more volume from existing customers, RouteOne CEO Mike Jurecki says.
There’s “a lot of traction this year” for e-contracting, he said in a phone interview on Monday. “It feels like a product whose time has finally come.”
E-contracting has been slow to catch on among dealers and lenders because of cost and complexity, plus simple resistance to change, industry experts have said. In 2013, though, some of the biggest captive finance companies greatly increased their e-contract use, according to RouteOne and the captives themselves.
In 2012, RouteOne’s e-contracting volume was just over 200,000, Jurecki said. In 2013 it more than tripled to over 700,000, and in 2014 the company expects volume to reach about 1.6 million contracts.
RouteOne’s e-contract customers include Ford Motor Credit Co., Toyota Financial Services, Bank of America and SunTrust Banks, the company said. According to RouteOne, as the captives use e-contracting more heavily, that motivates more dealers to sign up.
Alongside RouteOne, other providers of e-contracting services include DealerTrack Technologies and Open Dealer Exchange.
RouteOne’s main business historically has been electronically routing credit applications between dealerships and lenders. The process was unfamiliar to those parties at first but became routine, Jurecki said. The same thing is starting to happen with e-contracting, he said.
“It’s starting to feel like 2004, when we started launching the credit application system,” he said. “We kind of have that critical mass out there and everybody wants to be on board.”
You can reach Jim Henry at firstname.lastname@example.org