Saturday, September 22, 2018
Breaking News
Home » RV Industry News » Ally: Fears of RV industry downturn not behind its exit

Ally: Fears of RV industry downturn not behind its exit

Ally: Fears of RV industry downturn not behind its exit

DETROIT, Mich. — Ally announced the strategic decision to exit the RV consumer and commercial (floorplan) business on Aug. 14, causing many in the industry to speculate about the health of the RV industry and express concerns about coming downturn.

Ally’s press release seemed to add fuel to those concerns as it stated, “Over the last year, we have been challenged to achieve acceptable financial returns for this business segment and are thus redirecting resources to focus on our core auto finance business activities.”

Today, Kevin Wrate, senior regional vice president of Ally, reported these fears are unfounded.

“Ally made the strategic decision to wind down its RV financing business to better focus on growing our core auto finance operations,” he said. “This decision had nothing to do with any projection for the RV market. We see a lot of opportunity in our core auto finance business. Market conditions are good – consumers are healthy. Originations are up year over year.  Yields are increasing.  Given our environment and outlook, this is the best move for our business,.”

A recap of the specifics of Ally’s announcement are as follows:

  • Retail operations will discontinue August 17, 2018, which includes consumer application support and decisioning; RV consumer applications will not be accepted after this date
  • All pending RV retail contracts must be dated no later than August 31, 2018, with contract packages received by Ally no later than September 7, 2018 to be eligible for purchase
  • A local account executive will provide additional specific supporting information as it relates to any retail reserve issues and questions regarding your current RV retail portfolio with Ally
  • Commercial/floorplan operations will continue on a liquidating basis for the remainder of this year. The press release notes that Ally will work closely with every floorplan dealer to help facilitate a smooth and orderly transition to their new financing source over the course of the next few months.

Ally is asking that all floorplan dealers seek alternate inventory financing as soon as possible. In the interim:

  • There will be no additional credit facilities added for new points or approved for existing flooring accounts
  • Future bulk/seasonal inventory ordering and flooring should not be contemplated until an alternate floorplan financing source has been secured
  • All operational activity with the Costa Mesa office will remain unchanged and in place until such time that all accounts have migrated and liquidated, accordingly

“We would like to sincerely thank everyone for the support and business provided by the entire national RV dealer body. We appreciate the close relationships built over this time and wish all of you a prosperous and successful future,” Wrate added.

SOURCE: Ally press release and interview

Print Friendly, PDF & Email

About Ronnie Wendt

Ronnie Wendt is the editor in chief of RV Daily Report. She's been a writer/editor for more than 25 years, working in law enforcement, aviation, supply chain and now the RV industry. She's not a stranger to RVs, however. She grew up camping, and still camps as many weekends as she can every year.

2 comments

  1. I’d be bailing now too. Actually after a nice run I sold Thor and CW stock a few months ago. Anyone that does not believe there will be hell to pay during the next recession is ‘dumber than a box of rocks’. Granted the next recession probably will not hit until late 2019 and not be noticed until mid 2020. All these long term notes have hundreds of thousands of RVs underwater. REPOs will flood the market as they will not be able to be sold. When times get tough in any household RVs and boats are the 1st to go!

  2. So…. Ally is now bailing on the RV industry! Perhaps a sign that the healthy RV industry might have peaked out? We’ll see…. Things have been real good over the past decade. So good that RV manufacturers might be pushing their products out the door so fast – that they skim on the quality control. I will be watching to see if any other financers bail soon.

    RV manufacturers can only blame themselves if the industry fails! I am here to tell you that unsatisfied consumers, like me (purchased a lemon Thor class A with a faulty wall slide for $110,000 in 2016) are kind of watching to see if the RV industry would be negatively effected by such poor business protocols (including design, production and very poor customer service for failing to honor our 1 yr warranty). CONSUMERS ARE BEING PUT IN LINE BEHIND PROFIT……

    The RV manufacturers can only blame themselves. They are chasing families, such as ours, away from the industry. I feel bad for RV manufacturers, like Tiffin, who appear to have high quality products and good customer satisfaction from the research I have come across. BTW…. My lemon Thor RV was financed by Ally….

Leave a Reply

Your email address will not be published. Required fields are marked *

*

RV Daily Report welcomes comments from readers. However, we expect that comments will be cordial and professional without reverting to name-calling, profanity and libelous language. Comments of that nature will be removed.