P&A Providers & Administrators
MenuMENU
SearchSEARCH

Ally ‘Highly Confident’ About Overcoming Boot From GM Leasing Program

February 3, 2015
4 min to read


DETROIT — Just days before it named Jeffrey Brown as its new CEO, Ally Financial’s then-CEO Michael Carpenter expressed surprise at a move by General Motors to put 100% of its U.S. Buick, Cadillac and GMC lease incentives in the hands of its captive, GM Financial.


“While we were not surprised by the idea of GM growing their captive, we were surprised that they would exclude any competition in the lease space, where Ally has done such a great job for them over the last several years,” Carpenter said during a quarterly earnings call last week. “And frankly, we don't see how auto sales are increased by having less, otherwise known as no, options for consumers and dealers.”

Ad Loading...


In early January, General Motors announced that it planned to use GM Financial as the exclusive provider of subsidized leases in the United States, edging out both Ally and U.S. Bank from its lucrative subsidized leasing business.


“This will absolutely not impact our strong relationships and commitment to GM dealers and we will continue to support the channel,” Carpenter added.


The former CEO went on to say that once the company frees up capital from the subvented GM leasing business, it can “redeploy profitably in these other areas and increase share.” Those other areas, according to Carpenter, include the used-car market, franchised dealers and OEMs.


“For example, even though we're doing well and we have 4% share of the 10,000 non-GM/Chrysler relationships we have, over 6,500 of those do a very modest level of business with us today,” he noted. “And we believe we can increase that penetration with those dealers over the near term.


“We will also continue to have conversations with other auto makers to see how Ally can drive more value in their channels. And these OEMs are a lot more interested in talking to Ally now that we're out of the TARP, than they were before.”

Ad Loading...


During the call, officials reported a fourth quarter net income of $177 million, compared to $104 million in the fourth quarter 2013. For all of 2014, the finance source saw a net income of $1.2 billion, up from $361 million in 2013.


The increases were driven in part by results from Ally’s dealer-financial services business, which was headed up by Ally Financial’s new CEO, Jeffrey Brown. The group increased pre-tax income by 45% compared to the prior-year period, but that increase was due, in part, to a $98 million fine levied against Ally in the fourth quarter of 2013 by the Consumer Financial Protection Bureau and U.S. Department of Justice.


“Obviously, the year-over-year delta is impacted by the $98 million CFPB charge we took last year,” noted CFO Christopher Halmy during the call.


Ally’s auto finance franchise business remained strong during the quarter, with earning assets for the business up 3% year-over-year. Consumer auto financing originations for the quarter increased, and originations for the year hit $41 billion, the highest full-year total since 2007.


“The originations in the quarter were $9 billion, which we feel good about given the seasonal nature of the business,” Carpenter said. “These origination levels were driven by strong performance across multiple channels and were higher in every product year over year with the exception of subvented loans.”

Ad Loading...


New and used originations from non-GM/Chrysler dealers improved 37% compared to the prior-year period and increased 45% for the full year. The non-GM/Chrysler business now accounts for 22% of total consumer originations. Excluding originations from recreational vehicles, non-GM/Chrysler originations increased approximately 50% in the past year.


The finance source’s successes during the quarter and in 2014 as a whole had Carpenter “highly confident” that Ally will overcome being dropped from GM’s leasing program.


“… We have a range of options to handle these shifts in our business, which occur with some regularity,” he said. “And while the specifics may be a surprise of direction, we've dealt with this over five years. We have a battle-tested team. We've shown what we can do. We view this as another opportunity to evolve that business and we remain optimistic about the future potential, and we are committed to the plan that we showed investors at the time of the IPO.”

More Industry

Photo of gray SUV plugged into public electric-vehicle charger in parking lot
Industryby Hannah MitchellJuly 21, 2026

World EV Adoption Set to Grow

A new report says the segment, despite recent setbacks in some regions, is poised for acceleration as many countries look to reduce pollution.

Read More →
Bar chart of truck and SUV segments' weekly value change
Industryby StaffJuly 21, 2026

Black Book: Weekly Market Update

Wholesale automotive auction business stayed steady last week as bidders encountered lower prices, analysts observed.

Read More →
laptop with blue car on screen on a shopping website, Clear Costs Convert
Industryby Lauren LawrenceJuly 21, 2026

Pricing Transparency Drives Purchase Consideration

An annual study by JD Power found that clear pricing matters to consumers on automaker websites, so much so that it increases their purchase consideration.

Read More →
Ad Loading...
Bar graphic of used-car segment weekly change
Industryby StaffJuly 14, 2026

Black Book: Weekly Market Update

Used-vehicle market depreciation was the prevailing story in the wholesale market last week.

Read More →
Light-blue Fiat car parked on a sunny Chicago street
Industryby Hannah MitchellJuly 14, 2026

Smaller Is Looking Better

A growing number of Americans in the market for a new vehicle are opting for more affordable options, not waiting for market stability to bite the bullet.

Read More →
man sitting at desk using calculator with charts in front of him, to-go coffee cup on desk, rising and falling data chart in front
Industryby Lauren LawrenceJuly 14, 2026

U.S. EV Market Slowly Stabilizes

U.S. electric-vehicle interest is slowly stabilizing since a major dip in sales after last year's end of the federal EV tax credit, and hybrids remain the leading electrified power train.

Read More →
Ad Loading...
blue background, map of the world with connecting lights and an electric vehicle emblem in the middle
Industryby Lauren LawrenceJuly 8, 2026

Global EV Market Entering New Phase

Automakers are making investments to lower battery costs and optimize production to meet changing consumer needs.

Read More →
Bar chart showing week-over-week wholesale automotive price change
Industryby StaffJuly 7, 2026

Black Book Weekly Market Update

The holiday weekend, not surprisingly, put a drag on wholesale automotive activity last week, analysts observed.

Read More →
Photo of Honda CR-V SUV on two-lane road next to roadside trees
Industryby Hannah MitchellJuly 1, 2026

Auto Affordability in Context

Cox Automotive points out the complex circumstances that have led to eye-popping vehicle prices.

Read More →
Ad Loading...
Line chart of used-vehicle days to turn over past week
Industryby StaffJune 30, 2026

Black Book: Weekly Market Update

Automotive auction inventory increased last week, giving choosy bidders even more leeway.

Read More →