Dealers are looking for finance companies to be even more of an ally.

Against a backdrop of declining auto sales in Canada, J.D. Power emphasized that dealers are expecting their lenders to go shoulder to shoulder with them in weathering the tightening market, and are looking for lenders to foster a dealer-lender relationship focusing on ease of doing business. Analysts arrived at those assertions as part of the J.D. Power "2019 Canada Dealer Financing Satisfaction Study" released on Tuesday.

The top two reasons cited by dealers for sending business to a lender are the company’s people and relationships as well as how easy they are to work with.

“The constricting market presents both risk and opportunity for lenders,” said Patrick Roosenberg, director of automotive finance at J.D. Power. “As dealers face headwinds, the pressure on lenders mounts not only to be price competitive, but also to provide a high level of service.

“Every dealer-lender communication touch point, from the credit analysts to the sales representative, must be a value-add,” Roosenberg continued. “Lenders who are engaged with their dealer partners are poised to protect market share and even grow it over the long-term.”

The study also found that dealers will seek the path of least resistance. Dealers who gave high marks (9 or 10 on a scale of 1-10) on the reasonableness of the lender’s stipulation process, are twice as likely to increase their business with the lender compared with those who rated the process 8 or lower.

Lender rankings

Ford Credit ranked highest in the captive lender segment with a score of 915. Toyota Financial Services (897) came in second, and Honda Financial Services (891) followed in third.

Among non-captive lenders, TD Auto Finance ranked highest for the second consecutive year with a score of 906. Bank of Montreal (890) took second, and Scotiabank (888) finished third.

Overall satisfaction in the captive segment improved to 883 (on a 1,000-point scale), up from 875 in 2018. In the non-captive segment, overall satisfaction climbed to 878, a 16-point improvement over 2018.

The 2019 Canada Dealer Financing Satisfaction Study, now in its 21st year, captures 5,572 finance provider evaluations across the two segments from new-vehicle dealerships in Canada. The study was fielded in February.

For more information about the Canada Dealer Financing Satisfaction Study, visit this website.

Retail Credit Satisfaction Index Ranking
(Based on a 1,000-point scale)

Ford Credit: 915
Toyota Financial Services: 897
Honda Financial Services: 891
Captive Average: 883
Kia Motors Finance: 848
Nissan Canada Finance: 838
GM Financial: 772
Hyundai Motor Finance: 768

Note: Hyundai Motor Finance is award-eligible based on equivalent sample size calculations.

TD Auto Finance: 906
Bank of Montreal: 890
Scotiabank: 888
Non-Captive Average: 878
RBC Royal Bank: 866
Caisse Populaire Desjardins: 864
CIBC: 854
National Bank of Canada: 851
General Bank of Canada: 840
Scotia Dealer Advantage: 835
ATB Financial: 826
AutoCapital Canada: 819
IA Auto Finance: 817
CarFinco: 760
SCI Lease Corp.: 600