P&A Providers & Administrators
MenuMENU
SearchSEARCH

GM Financial Profit Rises 22 Percent on Loans, Leases For Carmaker

May 4, 2011
2 min to read


General Motors Co.'s finance unit said first-quarter profit rose 22 percent as the volume of loans it originated surged from a year earlier.


Net income climbed to $77.2 million from $63.2 million a year earlier, Fort Worth, Texas-based General Motors Financial Co. said today in a statement, reported The Detroit News.

Ad Loading...


GM Financial's loan originations climbed 82 percent from a year earlier to $1.14 billion in the quarter. The company started $310.9 million in leases in the quarter as it expanded such programs for GM, the largest U.S. automaker.


GM acquired the lender, formerly known as AmeriCredit Corp., last year before Chief Executive Officer Dan Akerson led the automaker through an initial public offering. More than $23 billion of common and preferred shares were sold in the IPO that reduced the U.S. and Canadian governments' stakes in Detroit-based GM.


Leases accounted for 16 percent of GM's U.S. sales through March, trailing the industry average of 22 percent, Don Johnson, vice president of U.S. sales, said on an April 1 conference call. Leases were 5 percent of GM's sales in March 2010, he said.


GM Financial offered leases in 30 U.S. states at the end of April, up from 21 at the end of March, Tom Henderson, a spokesman, said today in a telephone interview. The lender will offer leasing across the country by mid-year, Johnson has said.


Sales to subprime buyers in April accounted for about 7 percent of GM's deliveries, compared with 5.5 percent for the industry, Johnson said yesterday on a conference call.

Ad Loading...


GM will begin to establish wholesale financing at GM Financial "over time," Chief Financial Officer Daniel Ammann said at an investor conference last month. Wholesale lending involves financing dealers' inventory.


"We expect GM Financial to be active in subprime, active in lease, active in wholesale over time," Ammann said April 20. The market for buyers with prime credit is "well served" by other lenders, and GM doesn't see a need to underwrite loans in that market, he said.


GM Financial competes with Ally Financial Inc., which was formerly the automaker's GMAC Inc. finance arm. Ally handled 38 percent of retail lending to GM buyers last year, the lender said in February.


GM Financial will "bring competition to the market" and help the automaker continue to offer leases when other lenders pull back, Ammann said.


"If leasing goes away, we know that we can continue to do it," he said. "But having said all of that, we also want the third parties, of which Ally is the largest and most significant, to do a majority of our financing for us. We don't want to run a $100 billion balance sheet."

More Industry

Kia Niro SUV in gold color parked outdoors
Industryby Hannah MitchellSeptember 1, 2026

Kia Closes Out Summer With a Bang

Its U.S. subsidiary broke multiple records in August, in part due to a surge of demand for hybrids models.

Read More →
Outside of Auto Park Ford dealership
Industryby Lauren LawrenceSeptember 1, 2026

Indiana Dealership Changes Hands

A 30-year-old Ford dealership in Indiana has a new owner and will soon be undergoing renovations to meet manufacturer requirements.

Read More →
Three men standing in front of two classic cars handing off gift.
Industryby Hannah MitchellAugust 25, 2026

Texas Dealership No Longer in the Family

The Ford store, a longtime cornerstone of the Houston market, is now part of one of the fastest-growing U.S. auto groups.

Read More →
Ad Loading...
Outside of modern car dealership “Genesis of San Bruno
Industryby Lauren LawrenceAugust 25, 2026

Genesis Grows California Presence

The Cardinale Automotive Group opened its third Genesis rooftop in the Golden State, Genesis of San Bruno, a stand-alone dealership serving the San Francisco Bay Area.

Read More →
Red Honda Civic hybrid sedan on two lane road with green hills in background
Industryby Hannah MitchellAugust 21, 2026

August Auto Sales a Mixed Bag

An early forecast shows strong business despite consumer hurdles, and hybrids are a big piece of their affordability coping strategy.

Read More →
EV charger inserted into dark-colored car port
Industryby Hannah MitchellAugust 18, 2026

EV Market Humming Along

July sales show steady growth as the segment stabilizes from last year’s artificial surge following pullback of federal support.

Read More →
Ad Loading...
car in background with hand giving a thumbs up in front
Industryby Lauren LawrenceAugust 14, 2026

Auto Loan Delinquency Rates Stabilize

Auto loans are a main driver of nonmortgage consumer debt, but delinquency rates stabilized in the second quarter across all credit risk tiers.

Read More →
blue sky, yellow and orange rollercoaster with riders going up an incline
Industryby Lauren LawrenceAugust 12, 2026

EV Sales Recover in Q2

The EV sales roller coaster continues as numbers show improvement, but industry experts predict a year-over-year third-quarter decline and fourth-quarter jump.

Read More →
Photo of blue Toyota Prius parked next to body of water with city skyline in background
Industryby Hannah MitchellAugust 5, 2026

The Cheapest Hybrids to Fuel

The powertrain is increasing in popularity, in no small part due to its fuel economy. A new report lists the most efficient hybrids on the market.

Read More →
Ad Loading...
white SUV parked in front of a body of water with a gray sky background
Industryby Lauren LawrenceAugust 5, 2026

Hybrids and SUVs Gaining Ground

The most recent Kelley Blue Book Brand Watch found that only two nonluxury brands increased in shopper consideration, buoyed by their hybrid and SUV offerings.

Read More →