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Tuesday, January 18, 2022

Carmaker Stellantis reshuffles European financing operations

Author of the article:

Reuters

Giulio Piovaccari and Gilles Guillaume

MILAN — Carmaker Stellantis is in exclusive talks with BNP Paribas, Credit Agricole and Santander over the reorganization of its leasing and financing operations in Europe, it said on Friday.

The group plans to create a 50-50 long-term leasing company with Credit Agricole Consumer Finance, and to reorganize its financing activities through exclusive joint ventures with BNP Paribas Personal Finance and Santander Consumer Finance.

The plan marks a further step in Stellantis Chief Executive Carlos Tavares’ strategy to shape the world’s fourth-largest carmaker, which was formed just less than a year ago through the merger of Fiat Chrysler and Peugeot maker PSA.

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It will allow Stellantis to cut the number of financing and leasing entities it now operates in each European country from five to two.

“This is a strategic move to leverage our financial performance across all European countries,” Tavares said in a statement.

Chief Affiliates Officer Philippe de Rovira said the plan would also allow Stellantis to enhance its position in the European corporate leased vehicle market, where it aims to more than double its fleet by the end of the decade.

“We consider that in this segment, we have a huge opportunity for growth in the coming years,” he said.

Stellantis’ corporate leased vehicle fleet, now at 700,000, is expected to reach one million in 2026, he said.

As part of the plan, Stellantis will operate financing activities through JVs with BNP Paribas Personal Finance in Germany, Austria and the UK, and with Santander Consumer Finance in France, Italy, Spain, Belgium, Poland and the Netherlands.

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In Portugal it will work with Santander via a commercial agreement.

It will also sell its 50% stake in Fiat Chrysler’s former financial service arm FCA Bank, including Leasys’ short-term rent business, to Credit Agricole Consumer Finance, which currently owns the other half of the business.

De Rovira said the overhaul of its European financing operation would not impact jobs.

The deals could be signed in the first quarter of next year, and the transactions completed in the first half of 2023, Stellantis added.

Societe Generale is acting as financial adviser to Stellantis.

The European plan comes after Stellantis earlier this year agreed to buy U.S. auto finance provider First Investors Financial Services Group for about $285 million.

It had been the only major automaker operating in the United States without owning a captive auto finance provider. (Writing by Giulio Piovaccari; editing by Agnieszka Flak and Jan Harvey)

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Kaylie Pferten
A pilot of submersible crafts in a former life, now married to my husband David and writing about investment advice.

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