AFSA describes ‘glue’ that holds industry together

AFSA president and chief executive officer Chris Stinebert, seen here at Used Car Week this past November in Las Vegas, will be hosting more than 600 attendees during the Vehicle Finance Conference in New Orleans. Photo by Jonathan Fredin.

While the American Financial Services Association firmly is entrenched within the Capitol Beltway in Washington, D.C., the organization strives to represent the entire industry, not just a select group of players. AFSA president and chief executive officer Chris Stinebert reinforced that reasoning when describing the AFSA Vehicle Finance Board.

Stinebert said that board “features a broad cross section of companies: banks, captive finance companies and independent finance companies. Each member uses the indirect channel to finance new and used cars, trucks and motorcycles — meaning they purchase the loans from dealers and do not make auto loans directly to consumers.

“Indirect lending has proven to be the most cost effective and convenient way for consumers to finance a vehicle,” he continued. “Although each company competes fiercely for business, they all have common interests and concerns. This is the glue that binds.”

Those fierce competitors will be gathering together this week in New Orleans as AFSA hosts its annual Vehicle Finance Conference beginning. As usual, the gathering of auto finance company executives, legal experts and other service providers comes just ahead of the National Automobile Dealers Association Convention and Expo, also being conducted in the Big Easy.

“We have a wonderful working relationship with NADA,” said Stinebert, who again incorporated NADA leadership into the Vehicle Finance Conference program.

“Our relationship with NADA has been so productive because we look at the industry from the consumer’s point of view,” he continued. “We’re really talking about the same transaction.

“Both of our organizations represent members who have the same responsibility — to provide consumers with a smooth, transparent, and easy-to-understand vehicle purchase and financing process,” Stinebert added.

This year’s conference theme asks the provocative question, “Are we there yet?”

Stinebert said, “Our theme may remind you of a long road trip with your kids and sounds a bit odd. But it raises an extraordinarily important question. It provokes our members to ask themselves if their companies are 'there yet' on issues like compliance, cyber security, customer satisfaction and technology.

“We’re attempting to answer that question — sessions are focused on giving our members the tools and knowledge to make that journey,” he continued.

Josh Linker, an entrepreneur and hyper-growth CEO who has spent his career harnessing the power of disruptive change, will present the conference keynote. He will deliver a clear call to action for members — it is better to innovate and disrupt your organization before your competition does. The riskiest move companies can make today is embracing the status quo — believing the future will be like the past is the fast road to obsolescence.

Another important session will feature the three major credit bureaus coming together “to set the record straight” on the health of the subprime auto finance market. The experts scheduled to be a part of that discussion are:

— Denise Brown, chief risk officer Veritas Auto Finance and chair of the AFSA Vehicle Credit Risk Committee.

— Amy Crews Cutts, senior vice president and chief economist at Equifax Automotive Services

— Jason Laky, senior vice president and auto business lead atTransUnion

— Melinda Zabritski, senior director at Experian

David Paul (Vehicle Finance Division chair and senior vice president, financial services at American Honda Finance Corp.) and Mark Scarpelli (incoming NADA chairman and President of Raymond Chevrolet and Kia) will kick off the final day of the conference with a frank discussion about the important relationship between dealers and financing sources.

AFSA’s CEO Panel will feature key industry executives sharing best practices, compliance hurdles, and critical opportunities in the fast-moving marketplace of auto finance. That executive group is set to include:

— Jason Grubb, chief executive officer at Exeter Finance Corp.

— Dale Jones, executive vice president, Americas with Ford Motor Credit

— Mark O’Donovan, chief executive officer of Chase Auto Finance

— Vince Rice, executive vice president and consumer finance division head with Bank of the West

Organizers highlighted registration for the conference has grown steadily over the last decade. AFSA added that attendance at the 2017 conference has set a new record as more than 600 attendees will gather in The Big Easy to network, learn from the experts, and visit the conference’s more than 55 exhibitors.

Not only collaborating for this annual event, Stinebert touched on how else AFSA and NADA are working together so the financing of vehicle transactions goes well for all parties involved.

“One of AFSA’s core competencies is to educate politicians, regulators and most importantly, consumers, about the benefits of the auto financing process and the industry,” Stinebert said.

“This past year, in conjunction with the Federal Trade Commission and NADA, AFSA updated the Understanding Vehicle Financing brochure. This publication is a must read for anyone who wants to finance a car, including regulators and politicians,” he continued.

“Today, more than ever, consumers are going online to not only research certain vehicles in certain segments, but also to research the best way to finance and pay for their vehicles,” Stinebert went on to say. “In addition to constant dialogue with Capitol Hill staffs and regulators, this year AFSA and NADA are updating and modernizing the website for AWARE, an acronym for Americans Well-informed on Automobile Retailing Economics. This is a joint project shared by the two trade associations and their members. It is devoted to educating consumers about auto financing.”

As the industry descends into New Orleans, Stinebert shared his assessment of how the auto finance market behaved in 2016.

“We entered the year with concerns about The New York Times editorial on the pending subprime auto bubble and we ended 2016 with a huge sigh of relief,” he said. “Instead of disaster, we have enjoyed a very successful year of record sales.

“More importantly, the credit bureaus recently reported improved data on average credit scores and delinquencies, so no bubble and no crisis,” Stinebert continued. “This does not mean, however, we do not have many challenges going forward. But the looming regulatory and compliance issues facing the used-car market should see promised relief with the election of Donald Trump.”

Editor's note: Watch for updates from the Vehicle Finance Conference on our website as well as our Twitter feed at @SubPrimeNews.