Santander Consumer USA and Ally Financial Inc. passed each other coming and going in the first quarter in terms of business with Chrysler Group, but don’t expect them to exchange a friendly wave.
The preferred lender agreement between Chrysler Group and Ally expired on April 30, 2013, after a four-year run. Chrysler replaced Ally with Chrysler Capital, a program in which Santander Consumer USA provides Chrysler dealers with private-label auto financing.
Both Ally and Santander reported their first-quarter financial results on May 1. Volume was way down for Ally Financial’s Chrysler originations -- at zero for incentivized new-vehicle loans, down from $231 million in the year-ago period, and down 32 percent to $708 million for standard-rate new-vehicle loans. Ally’s new-vehicle leases for Chrysler plunged 67 percent from the first quarter of 2013, to $257 million.
Meanwhile, Santander’s Chrysler originations in the first quarter this year were $3.5 billion in loans and $1.2 billion in leases, out of a total of $6.9 billion in consumer loans and leases. In the first quarter of 2013, its total originations were about $2.8 billion.
Santander Consumer USA had an initial public offering in January. The full details of its Chrysler business in the first quarter of last year weren’t available, but the company reported it originated only $60,000 worth of leases in the quarter.
There’s no love lost between Ally and Santander, judging by a lawsuit Ally filed in September, accusing Santander Consumer USA of copyright infringement and misappropriation of trade secrets related to the launch of Chrysler Capital. Santander Consumer USA said in an SEC filing it considers the allegations “without merit” and said it intends to “vigorously defend” the case.
It’s always awkward after a breakup.