GM to acquire AmeriCredit Corp for $3.5 billion

Article by Christian Andrei, on August 29, 2010

General Motors Co. has entered a deal to acquire subprime specialist AmeriCredit Corp. for $3.5 billion. This all-cash deal marks GM's return to the captive finance business.

In a statement, GM described this acquisition as establishing the core of a new GM captive finance arm, which will help the carmaker reach more customers through leases and loans to borrowers with flawed credit records.

According to three people who are familiar with the talks, GM considered buying back former lending arm GMAC LLC (Ally Financial Inc.). GM also thought about starting a bank or working with outside lenders to offer more financing options to customers.

These sources said that GM found it too much of a challenge at that point to buy back GMAC or start a new, in-house banking unit.

Joe Phillippi, principal of AutoTrends, a consulting firm in Short Hills, N.J., said that this deal enables GM to finance less-than-perfect-credit buyers, which he says are plenty today especially with the current economic conditions.

He added that this region of people who have imperfect credit histories has been the core of GM's strength. [via autonews - sub. required]

Topics: gm, united states

If you liked the article, share on:

Comments

Login or Create new account to add a comment!

Recommended

Mercedes-Benz has revealed that in 2017, its series 124 coupé will be celebrating its 30th anniversary. While this itself is a significant event, it will also mean that this model...
by - January 21, 2017
BMW’s 550i xDrive has long been considered as one of the most successful business sedans in the world. For the brand, this may not be enough as it has officially...
by - January 20, 2017
Amazon is now moving beyond the four corners of online retailing. Only recently, the retail giant has been awarded a patent for its Road Network system. Since the patented technology...
by - January 20, 2017
The newest version of the Lamborghini Huracan is not a Superleggera, but a Performante. When Lamborghini filed for a patent for a new name, there were still debates whether this...
by - January 20, 2017
What is hotter and more menacing than a Hellcat? If we ask Dodge, its answer would be the “Demon.” Of course, we aren’t talking about a demon with horns and...
by - January 20, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries