Starting in March, GMAC Financial Services will charge dealerships more to keep aging new vehicles on their lots.
In a letter this month, the finance company outlined policy changes for dealerships that use GMAC credit lines to finance vehicle inventories. Dealers say the letter details an accelerated schedule for paying off principal on loans for older new-vehicle inventory.
GMAC took similar action last year toward dealerships' aging used-vehicle inventories.
GMAC has liberalized some lending policies since the federal government gave the company a $6 billion bailout last month. But dealers complain that GMAC still is not doing enough to make credit more broadly available via floorplan loans or consumer leases and subprime loans.
GMAC spokesman Mike Stoller said it is not unusual for the company to require dealers to start repaying principal on cars and trucks that have been on the lot for a long time. Because of the sharp slowdown in vehicle sales, many dealers say the age of their new-vehicle inventories is increasing.
Last year, U.S. new-vehicle sales plunged to 13.2 million, down 18.0 percent from 2007 and the lowest total since 1992. New-vehicle sales by General Motors — whose dealers are GMAC's primary customers — dropped 22.7 percent to fewer than 3 million units.
Stoller declined to say how many aging vehicles GMAC is continuing to finance or whether that number represents an increase from previous years. He would not say how many dealerships are affected by the changes. He declined to identify the repayment schedule in the current wholesale plan.
Carroll Smith, owner of Monument Chevrolet in Pasadena, Texas, said the required paybacks on the 2008 medium-duty trucks he has in inventory will cost him about $40,000 a month. He said the new GMAC requirements are more aggressive than past standards. "I have always been very diligent about not having old inventory, so I really haven't been much affected in prior years," Smith said. "This will compound dealer cash flow problems."