Report prospectus consumer_automotive_financial_services_emerging_global_markets

Consumer Automotive Financial Services in Emerging Global Markets

Consumer Automotive Financial
Services in Emerging Global Markets
Report prospectus

February 2012

Expertise in financial services
© Finaccord Ltd., 2012 Web: www.finaccord.com. E-mail: info@finaccord.com 1


Prospectus contents

Page

What is the research? 3
What methodology has been used? 4
How do dealership surveyed break down? 5
Which manufacturer brands have been investigated? 6
What is the report structure? 7
What are the key features of the research? 8
How can the research be used? 9
How can the PartnerBASE™ be used? 10
Who can use the research? 11
What are some of the key findings? 12-15
What is the cost and format? 16
How can the research be purchased? 17



What is the research?
Finaccord’s report titled Consumer Automotive Financial Services in Emerging Global Markets
investigates the market for automotive financial services linked to sales of new and used passenger
cars in ten important global markets. In addition to analysing the USD 182 billion market for finance
and leasing services, the study also covers ancillary automotive financial services markets namely
creditor insurance, motor insurance, road assistance, extended warranties and GAP insurance. The
revenues generated from high margin ancillary products, which Finaccord quantifies for the first
time in any published study, are crucial to enhancing the profits of a variety of market participants
including dealers, manufacturers and independent finance providers.

The report draws on a survey of 765 leading car dealerships in ten countries, namely Argentina,
Brazil, China, India, Indonesia, Mexico, South Africa, South Korea, Taiwan and Thailand, as well as
an analysis of the approach to consumer automotive financial services of leading manufacturer
groups typically representing around 30 automotive brands, in the same countries. The
PartnerBASE™ database that accompanies the report details each of the marketing initiatives for
consumer automotive financial services traced by Finaccord for both dealers and manufacturers.
Together, the report and database will provide you with the definitive guide to current and future
opportunities in consumer automotive financial services in ten emerging global markets.



What methodology has been used?
Finaccord’s survey of dealerships in emerging global markets was carried out between November
2011 and January 2012. The research embraces the following information:

• whether automotive financial services are marketed to purchasers of new and used vehicles;
• if so, how many providers are used?
• if so, what are the identities of the providers used?
• if so, how do these differ between manufacturer-branded providers and independent suppliers?
• if so, what are the average take-up rates for buyers of new and used cars?

The results of this research provide unique data for dealer penetration rates, operating models,
provider share of partnerships, and both average and overall customer take-up rates for dealer-
intermediated finance / leasing, creditor insurance, motor insurance, road assistance, extended
warranties and GAP insurance in each country.

Moreover, Finaccord’s manufacturer brand survey pinpoints programs organised by manufacturers or
their local importers in each country for the same products, identifying the extent to which these are
offered through captive entities or in association with external partners. As such, this constitutes a
unique report with an unrivalled level of detail about countries that are key to the future of the
automotive industry.


How do dealerships
surveyed break down?
Taiwan, Toyota, 8.8%
7.8% Multi-
China, 13.1% Volkswagen,
marque,
South Africa, 5.8%
25.6%
7.8%
Hyundai,
Indonesia, 5.6%
India, 12.0%
8.5% Chevrolet,
5.1%
Maruti
Thailand, Suzuki, 5.0%
9.2% Brazil, 10.8%
Honda, 4.8%

Other Ford, 4.7%
Argentina,
9.8% Mexico, groups, Nissan, 3.9%
South Korea, 10.5% 25.0%
Mitsubishi, Fiat, 3.1%
10.5%
2.6%
Finaccord’s universe of dealerships includes 765 respondents in total spread across ten important
emerging markets including manufacturer-owned dealerships, franchised dealerships, multi-marque
dealerships and new and used car supermarkets. For a full list of the organisations contacted for the
research and included in PartnerBASE™, please contact Finaccord.



Which manufacturer brands
have been investigated?
Manufacturer brands investigated through the local offices of the manufacturers themselves or those
of their importers in at least one of the countries covered in this report are as follows:
Acura Chery Geely Jinbei MG Škoda
Alfa Romeo Chevrolet Gleagle Karry Auto MINI Smart
Alpheon Chrysler Great Wall Kia Mitsubishi Soueast Motor
Aston Martin Citroën Hafei Automobile Lamborghini Nissan Spyker
Audi Daihatsu Haima Land Rover Opel SsangYong
Baojun Dodge Hawtai Landwind Peugeot Subaru
Bentley Effa Hindustan Motors Lexus Porsche Suzuki
Besturn Emgrand Honda Liebao Proton Tata Motors
BMW Englon Hongqi Lifan Motors Ram Tobe
Buick FAW Hyundai Lincoln Rely Toyota
BYD Fengshen Infiniti Luxgen Renault Troller
Cadillac Ferrari Isuzu Mahindra & Mahindra Renault Samsung Volkswagen
Chana Fiat JAC Maruti Suzuki Riich Volvo
Changan Force Motors Jaguar Maserati Roewe WuLing
Changfeng Ford Jeep Mazda Saab Zhonghua
Changhe FXauto Jiangling Mercedes-Benz Seat Zotye Auto



What is the report structure?
0. Executive Summary: providing a concise evaluation of the principal findings of the report.

1. Introduction: offering a rationale, a detailed description of methodology and definitions.

2. Overview: including an overview of the markets for providing finance / leasing, creditor
insurance, motor insurance, road assistance, extended warranties and GAP insurance in
conjunction with the purchase of new and used passenger vehicles across the ten countries.
Analyses include: comparisons of the size and segmentation of automotive financial services
markets; dealership penetration rates, operating models and competitor dynamics; average
customer take-up rates at the point of sale; and prevalence of manufacturer-branded programs.

3. Argentina: comprising an in-depth analysis of the market for consumer automotive financial
services including: an overview of sales of new and used passenger cars; size, segmentation and
growth of automotive finance and leasing; revenues from ancillary financial services; dealer survey
results including analysis of the balance between manufacturer-branded / tied and independent /
non-tied providers; and manufacturer survey results, including operating models and provider share
of partnerships, weighted by brand sales, for manufacturer-branded programs.

4 - 12: Brazil, China, India, Indonesia, Mexico, South Africa, South Korea, Taiwan and Thailand (for all, contents as for Argentina).



What are the key features of the research?
Key features of this report include:

• coverage of the six distinct sectors within consumer automotive financial services, namely finance /
leasing, creditor insurance, motor insurance, road assistance, extended warranties and GAP
insurance;

• provision of hitherto unpublished market size and segmentation data for each of these markets
generated from Finaccord’s proprietary Global Automotive Financial Services Model;

• clear analysis of the market for consumer finance and leasing services related to new and used car
sales by distribution channel, differentiating between the point of sale and direct lenders;

• presentation of unique data from the survey of dealerships illustrating average customer take-up
rates for consumer automotive financial services at the point of sale in each country;

• identification of the partners used for consumer automotive financial services by both dealerships
and manufacturers, or their local importers, with contextual commentary concerning key competitors.



How can the research be used?
You may be able to use this report and the PartnerBASE™ that accompanies it in one or more of
the following ways:

• understand how the total market for consumer automotive financial services related to purchase of
new and used passenger cars fits together in ten emerging global markets;

• appreciate the magnitude of the opportunity in consumer automotive financial services and how
this breaks down by both product and distribution channel;

• identify key opportunities and gaps in the market - what automotive financial services are
customers most likely to buy and to what extent are their preferences served by dealers and
manufacturer brands?

• adjust your own company’s strategy in accordance with this analysis;

• evaluate the partnership strategy of your organisation and how it can secure a higher share of the
market for consumer automotive financial services in ten key global markets by re-evaluating its
approach to distribution alliances with dealer groups and manufacturers.



How can the PartnerBASE™ be used?
Search by type of
Select country automotive financial service

FINANCE AND LEASING
Product
Brand Country offered? Operating model Partner(s)

Tata Motors India Yes Captive finance provider + multiple partners HDFC Bank, ICICI Bank, SBI, Tata Motors Finance
Tata Motors South Africa Yes Multiple partners Nedbank, Standard Bank, WesBank
Tobe Taiwan No
Toyota Argentina Yes Captive finance provider Toyota Financiera
Toyota Brazil Yes Captive finance provider Banco Toyota

Look up Identify product
Choose operating model
specific brands partners

Note: for this report, PartnerBASE also covers 765 dealerships.



Who can use the research?

1. Automotive manufacturers: this research provides a wealth of unique and valuable
benchmarking data allowing you to assess objectively your performance in consumer
automotive financial services and to counter the threat from non-captive competitors;

2. Finance and leasing providers: what are the opportunities to increase or build market share of
consumer automotive finance and leasing for consumers in each country in both the point-of-
sale and direct lending channels?

3. Insurance, warranty and assistance firms: what is the potential to introduce insurance, warranty
or assistance programs in each country marketed either through manufacturer brands or
through dealers?

4. Management consultancies: are you helping a manufacturer, finance / leasing provider, insurer,
warranty company or assistance firm with its strategy or evaluating how it can develop its
business in consumer automotive financial services? Understand the current status of
automotive financial services in ten emerging global markets, saving time and effort on
researching the subject yourself.



What are some of the key findings?
1. Across the ten countries combined, the number of both new and used
passenger cars financed have increased strongly since 2007

Volume of passenger cars financed (million)
Used
30 cars

New
24 cars

18 Cash

12

6 Direct lender

Point of sale
0
2007 2008 2009 2010 2011
Source: Finaccord Global Automotive Financial Services Model



What are some of the key findings? (cont.)
2. Most manufacturer brands in Thailand offer road assistance, with AXA Assistance
holding the largest share of provider mandates, weighted by new car registrations

% of manufacturer brands offering road assistance and operating model Weighted provider share of partnerships, %
100% Tokio Marine
legendtrick Sri Muang,
7.1%
Sompo
80% Japan, 7.1%
Internal assistance Mitsui
provider Sumitomo,
60%
7.1%
Multiple partners AXA
Bangkok Assistance,
40%
Insurance, 47.3%
7.1%
20% External assistance
provider

0% Auto Assist
Product offered Operating model (Mondial
(see legend) Assistance),
Source: Finaccord Global Automotive Financial Services Survey 24.2%



3. Car dealers in South Africa offer a wide range of
automotive financial services to consumers

% of dealers offering various automotive financial services

Finance and leasing 98.3%

Creditor insurance 93.2%

Motor insurance 56.7%

GAP insurance 91.7%

Extended warranties 91.7%

Road assistance 100.0%

0% 20% 40% 60% 80% 100%
Source: Finaccord Global Automotive Financial Services Survey



4. Key findings from the executive summary include:

• across the ten countries in question, the total value of the consumer automotive finance and
leasing market in 2011 broke down between USD 123.4 billion in gross advances and assets
leased attributable to new cars and USD 58.7 billion attributable to used vehicles;

• revenues available to the automotive trade from the ancillary consumer automotive financial
services investigated totalled approximately USD 22.1 billion in 2011, almost 90% of which was
attributable to motor insurance;

• the automotive trade was responsible for distributing more than 70% of the value of personal
motor insurance for passenger cars in China, India and Indonesia in 2011;

• international protagonists such as Allianz, AXA, BNP Paribas Cardif, HSBC, MAPFRE, Santander
and Zurich, among others, are building partnerships with manufacturer brands and local importers
in order to consolidate their position in markets that are often fragmented.



What is the cost and format?
Consumer Automotive Financial Services in Emerging Global Markets is available as a standard Adobe
Acrobat PDF document and / or hard copy. The PartnerBASE™ that accompanies it at no further charge
is in Microsoft Excel format. Costs for this research set and other titles about automotive financial
services are as follows:

REPORT PRICE *
Consumer Automotive Financial Services in Emerging Global Markets GBP 3,995
Automotive Finance and Leasing for Consumers in Emerging Global Markets GBP 1,995
Automotive Finance and Leasing for Consumers in Europe GBP 2,495
Consumer Automotive Financial Services in Eastern and South-Eastern Europe GBP 2,495
Consumer Automotive Financial Services in Northern and Central Europe GBP 2,995
Consumer Automotive Financial Services in Southern and Western Europe GBP 2,995
Extended Warranties for New and Used Cars in Emerging Global Markets GBP 1,995
Extended Warranties for New and Used Cars in Europe GBP 2,495
Manufacturer-Branded and Dealer-Intermediated Motor Insurance and Road Assistance in Emerging Global Markets GBP 1,995
Manufacturer-Branded and Dealer-Intermediated Motor Insurance and Road Assistance in Europe GBP 2,495

For UK-based clients, VAT at the prevailing rate will be added to the basic price.
Costs quoted are for a single site user licence only.
For a corporate user licence, please see the next slide for further details.
Invoices can be paid in EUR, at the prevailing exchange rate, if preferred.


How can the research be purchased?
Simple. Just go to the relevant area of the Finaccord web site available at
www.finaccord.com/order_eu_afsr.htm and fill in the online order form, clearly indicating:
• report required
• type of corporate user licence, if required *
• billing name
• address and e-mail address
• purchase order number, if applicable

Please allow up to one working day for the delivery of electronic copy by e-mail.

* For the corporate user licence please choose one of the following options:
1. One office, one country: no supplement over and above basic cost of reports ordered
2. Multiple offices, one country: additional 20% over and above basic cost of reports ordered
3. Multiple offices, two to ten countries: additional 50% over and above basic cost of reports ordered
4. Global (unlimited offices in unlimited countries): additional 100% over and above basic cost of reports ordered

VAT at the prevailing rate will be added to the price of any corporate user licence acquired by UK-based buyers.


Report prospectus consumer_automotive_financial_services_emerging_global_markets

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