VW Credit Inc., Volkswagen Group of America's captive finance company, wants its dealers to file consumer loan applications and submit signed agreements electronically, down to the last piece of paper.
The lender, which has grown in recent years as Volkswagen and Audi sales have risen in the United States, will spend $30 million on information technology improvements over the next two years, CFO Christian Dahlheim said during an interview. One goal is to digitize every form that goes to VW Credit, starting this year for some dealers.
With the investment, VW Credit is joining the ranks of other captive finance companies -- including BMW Financial Services, Mercedes-Benz Financial Services and Ford Motor Credit Co. -- that envision car buyers signing their contracts on iPad tablet computers, no ink required. Fans of the technology say it will make the F&I process speedier and more professional and also cut down on errors in contracts.
"What we're trying to do is vastly improve the customer experience," Dahlheim told Automotive News. "We're big enough now that we can actually do it."
VW Credit, which finances Volkswagen and Audi vehicles, signed 404,947 contracts in 2012, up 28 percent. It ended the year with a record $23 billion in assets.
Five dealerships are trying the e-contracting system in a pilot project. VW Credit plans to release the software to dealers in some states by the end of 2013 and plans to have ink signatures eradicated "after 2014," Dahlheim said.
Signing the forms electronically may yield some savings, but that was not the impetus behind VW Credit's investment. The driver was the J.D. Power and Associates customer satisfaction survey, which shows that one of buyers' biggest pet peeves is waiting inside the F&I office and signing reams of paper.
"We do see efficiencies in that process," Dahlheim said of paperless contracting. "But that's not the driver. The driver is the customer experience."