Sumitomo Mitsui Banking Corporation, Mazda Motor, Central Finance and Ford Motor Credit Company to Form Strategic Alliance in Auto Finance Business in Japan.
SMBC, Mazda and CF will acquire 41 percent, 40 percent and 15 percent, respectively, of the outstanding shares of PRIMUS, which is currently a wholly owned subsidiary of Ford Credit International Inc. ("FCI"). FCI is a wholly owned subsidiary of FMCC. FMCC will continue to hold a 4 percent stake in PRIMUS through FCI. PRIMUS plans to expand its presence under the new administration on April 1, 2008, subject to regulatory approvals. It is expected that, post acquisition, PRIMUS will become a consolidated subsidiary of SMBC and an equity method affiliate of Mazda and CF.
PRIMUS, as the Japanese subsidiary of the FMCC group (which is one of the largest auto finance companies in the world) has assets of approximately JPY 200 billion, and has offered auto loans to customers of Mazda and the Ford group (Ford, Volvo (passenger car), Jaguar and Land Rover), and various financial products to dealers of those brands in Japan.
PRIMUS continues to position captive financing (OEM-cooperative automotive financing) to Mazda and the Ford group as its main business. The same standard of service to customers will continue to be provided through essentially the same operational resources, including employees. In addition, the JV partners - SMBC, Mazda, CF, and FMCC - will combine their expertise and business resources to enhance PRIMUS' business platform and improve its profitability.
SMBC will position this strategic alliance as part of its attempt to enhance its consumer finance business, and it will aim to improve its presence in the auto finance industry. As publicly announced on February 29, 2008, CF plans to merge with OMC Card Inc. and QUOQ Inc. The newly established company's annual auto loan contract volume after the merger will be approximately 380 billion yen.
This, combined with PRIMUS' annual contract volume of 80 billion yen, will make them a major player in the auto loan market. Based on this business platform, they will strive to take advantage of the extensive finance business know-how of the SMFG group, centering on SMBC, to develop products and services that will better satisfy their customers.
In the increasingly competitive domestic automobile market, sales promotion measures that leverage automotive financing are becoming more important. Under such circumstances, this strategic alliance is an important and strategic initiative for Mazda to enhance its domestic sales structure. Mazda, together with PRIMUS, has been taking initiatives such as the 'Mazda Advantage Loan' deferred credit plan, which was launched in July 2007. Through this strategic alliance, Mazda and PRIMUS will strive to offer even more attractive financing programs while working on the enhancement of brand value.
For more information, please contact:
Mazda Motor Corporation
Corporate Communications and Liaison Division
Source: Mazda Motor Corporation
Japan Corporate News Network. All rights reserved.
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|Date:||Mar 13, 2008|
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