Cox Automotive siblings to offer F&I products

Brian Geitner, president of Cox Automotive's Financial Services and NextGear Capital: “The franchise dealer is going to be a big part of our 2016."

Cox Automotive’s new push into the finance and insurance world aims to court smaller franchised dealership groups.

Dealers who do business with NextGear Capital and GO Financial soon will be able to offer consumers an array of F&I products provided by companies owned by SilverRock Holdings.

Cox Automotive, parent of NextGear Capital and GO Financial, has acquired a minority interest in SilverRock Holdings.

Brian Geitner, president of Cox Automotive’s Financial Services and NextGear Capital, said the partnership will help dealers affiliated with GO Financial and NextGear Capital create a one-stop product approach and a more efficient transaction process for retail customers.

He also said it will help his companies grow their businesses, especially with franchised dealers who own smaller retail operations.

Growth goals

“We’ve got a lot of goals this year, [including] tempered growth -- we are a growth company, for sure,” Geitner said. “The franchise dealer is going to be a big part of our 2016. We’re excited about it.”

GO Financial is a subprime retail finance company, and NextGear Capital provides floorplan loans to finance franchised and independent dealerships’ new- and used-vehicle inventory.

NextGear Capital is focused on growing relationships with smaller franchised dealers who have, on average, one or two dealerships and are seeking credit lines of $6 million to $8 million.

In 2014, NextGear Capital began offering loans to finance franchised dealerships’ new- and used-vehicle inventory. Before that, it offered financing primarily for independent used-car dealerships. It had extended some loans to franchised dealers to finance their used vehicles, but that made up a very “small portion” of its business, the company told Automotive News previously.

Bigger customers

Geitner said of the 23,000 dealers who finance vehicles through Next Gear, about 100 are franchised dealers. But he also said those individual franchised dealers’ lending relationships “are 10 to 20 times the size of our average independent dealer. Lending to 100 of them is a lot of lending.”

SilverRock Holdings owns SilverRock Automotive, a vehicle service contract administrator and obligor; SilverRock Insurance, an online insurance agency; and BlueShore Insurance Co., a property and casualty insurance company.

Through its companies, SilverRock Holdings provides F&I products such as extended service contracts, guaranteed asset protection, vehicle-theft protection and GPS tracking products. It also offers auto insurance to consumers through independent and franchised dealers.

SilverRock Holdings is majority owned by Ernest Garcia and Ray Fidel of DriveTime Automotive Group, through their separate company, Oreno Holdings. Garcia is chairman of DriveTime, and Fidel is CEO, according to his LinkedIn profile.

The acquisition closed Dec. 31.

You can reach Arlena Sawyers at asawyers@crain.com

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