GrooveCar's `Dealer Challenge' Gets CUs', Dealers' 2006 Auto Lending Activity Off to Fast Start
HAUPPAUGE, N.Y. - The year may already be five months old, but credit unions on Long Island got a jumpstart on their annual auto lending activity from the successful Dealer Challenge that was run by GrooveCar for the first three months of the year. The 2006 GrooveCar Dealer Challenge ran...
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HAUPPAUGE, N.Y. – The year may already be five months old, but credit unions on Long Island got a jumpstart on their annual auto lending activity from the successful Dealer Challenge that was run by GrooveCar for the first three months of the year. The 2006 GrooveCar Dealer Challenge ran from Jan. 1-March 31 and was designed to help New York credit unions and dealerships the privately owned indirect lending provider has relationships with get geared up for a solid year and to provide an extra incentive for dealer finance and insurance manager to achieve peak performance goals. In all, over 300 auto/motorcycle dealers in the GrooveCar network in New York participated in the three-month event. By the time the initiative wrapped up, almost $250 million in applications were processed, including $40 million in the last 10 days of March alone. GrooveCar has partnerships with 20 credit unions in the metro New York area including 16 just on Long Island. It counts 207 auto dealers in its network plus 50 motorcycle dealers. GrooveCar President David Jacobson drew on his prior work experience as an auto dealer for coming up with the idea of running the Dealer Challenge. He recalled how the banks and captive lenders would offer big incentives to the dealers to push them to reach certain goals. “I thought why not do the same thing for credit unions,” said Jacobson, “as a way to increase loan productivity during the traditionally slow winter months and at the same time build awareness among the dealers of credit unions’ indirect lending offerings and motivate them to send loans to credit unions and partner with them.” The GrooveCar president added that the challenge was also a way to incent those dealers that typically give credit unions a minimal number of applications each month, to do more. “Some dealerships use indirect lending more than others,” Jacobson explained. “Some of them only give us applications for current credit union members, but not new ones. This was a way to motivate them.” Participating dealerships were challenged to excel in either of two categories – volume, or the number of funded loans; and “look-to-book ratio”, or the amount of funded applications-to-applications received. Out of the 12 months in a year, Jacobson said January through March are typically slow months, and April, May, August and September are the best selling months for cars. “So doing a Dealer Challenge January through March sets up a nice momentum going into April,” said Jacobson. Because of the success of the first 2006 Dealer Challenge, Jacobson is considering running a similar event in late spring. In July he’s planning an auto sales event in which all of GrooveCar’s credit unions and dealers will be invited to participate. “Not only did this motivate dealers to start the year off strong, but it carried momentum that generated into the hot spring selling season. We built better awareness about credit union financing in the process, and this contributed to giving us an edge on the competition,” said Jacobson. -
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