"Invest in America," launched Dec. 10 with GM in four Midwest states as a pilot venture with an eye toward a national rollout next summer, has added eight more states to the financing alliance offering low-cost, CU loans and $500-$1,000 price discounts on Chrysler purchases.
The linkups with GM and Chrysler are aimed both at increasing auto loan business and new membership for CUs in the 12 states, while also demonstrating support for strapped automakers by boosting auto sales and aiding local communities. A similar deal is being worked on with Ford.
Addressing reporters in a conference call, David Adams, president/CEO of the Michigan league, said the Invest program created by CUcorp, a league subsidiary, has now expanded the venture through the Chrysler tie-in beyond Michigan, Ohio, Indiana and Illinois to 12 other state leagues.
There are plans to go national "possibly by the second quarter of 2009." The newly participating states included Oklahoma, Texas, Kentucky, Arkansas, Tennessee, Louisiana, New Mexico and Mississippi, according to Adams.
Under the Chrysler pact, CU members who take out an auto loan at a CU receive cash rebates of $500-$1,000 plus other incentives on eligible Chrysler, Jeep and Dodge vehicles.
Adams stressed that CUs across the region "are liquid and have money to lend" for car loans, with rates averaging 5.4% "compared to 6.9% for banks."
To gain access to the rebates, CU members must bring proof of membership to a Chrysler dealership.
Adams said the reaction among participating CUs in the GM plan in the initial four states has been favorable, with the league's Web site, lovemycreditunion.org, receiving 350,000 hits in the first 10 days.
"We're getting lots of member inquiries and our staff is very happy with the response and dealer sales visits," said John Owens, senior vice president/marketing at the $435 million Community Choice CU in Farmington Hills, Mich.
While grateful for the "publicity and the big splash," the $50 million Afena FCU in Marion, Ind. noted that in GM towns like Marion, with an automaker metal fabricating plant, the price discounts are moot. "Many of our members, as employees of GM, already get the incentive deals and bonus cash," said Chad Spada, director of marketing. "We still think the campaign is good for credit unions."