DaimlerChrysler seeks licence to open U.S. bank
#1
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DaimlerChrysler seeks licence to open U.S. bank
DaimlerChrysler seeks licence to open U.S. bank - - Reuters / November 16, 2005 - - Source: Automotive News
BERLIN -- DaimlerChrysler intends to launch its own bank in the United States as a way to reduce borrowing costs, the head of the German-American carmaker's financial services division said.
"We hope to get approval in the first quarter of 2006," Juergen Walker told journalists in Berlin on Tuesday, Nov. 15.
The bank could operate across the United States by gaining a license in the state of Utah as long as it is organizationally separate from the group's car business, Walker explained.
The finance arm at world's fifth-biggest carmaker could use such an arrangement to get better borrowing terms than the overall group can arrange, he said.
DaimlerChrysler is rated "BBB" by Standard & Poor's, "A3" by Moody's and "BBB+" by Fitch, which is higher than U.S. rivals General Motors and Ford Motor Co., whose debt ratings have fallen below investment grade.
DaimlerChrysler already operates a bank in Germany and recently won approval to offer financial services such as leasing and car loans in China.
U.S. operations make up around 70 percent of the financial services division's business volume. The division boosted nine-month operating profit 1 percent to 1.12 billion euros ($1.3 billion).
"We expect to have good results for the full year as well," Walker said, but he would not specify whether they would be above the 1.25 billion euro operating profit it made in 2004.
Walker said his division would continue to focus on core businesses such as leasing, finance for private customers, insurance and fleet management.
It remained committed to its 45-percent stake in Toll Collect, which operates Germany's truck toll system. Deutsche Telekom also has 45 percent and France's Cofiroute the other 10 percent.
"We hope to get approval in the first quarter of 2006," Juergen Walker told journalists in Berlin on Tuesday, Nov. 15.
The bank could operate across the United States by gaining a license in the state of Utah as long as it is organizationally separate from the group's car business, Walker explained.
The finance arm at world's fifth-biggest carmaker could use such an arrangement to get better borrowing terms than the overall group can arrange, he said.
DaimlerChrysler is rated "BBB" by Standard & Poor's, "A3" by Moody's and "BBB+" by Fitch, which is higher than U.S. rivals General Motors and Ford Motor Co., whose debt ratings have fallen below investment grade.
DaimlerChrysler already operates a bank in Germany and recently won approval to offer financial services such as leasing and car loans in China.
U.S. operations make up around 70 percent of the financial services division's business volume. The division boosted nine-month operating profit 1 percent to 1.12 billion euros ($1.3 billion).
"We expect to have good results for the full year as well," Walker said, but he would not specify whether they would be above the 1.25 billion euro operating profit it made in 2004.
Walker said his division would continue to focus on core businesses such as leasing, finance for private customers, insurance and fleet management.
It remained committed to its 45-percent stake in Toll Collect, which operates Germany's truck toll system. Deutsche Telekom also has 45 percent and France's Cofiroute the other 10 percent.
#3
Since the Big three only seem top make money off the financing, maybe that will be the new business model- selling cars for nothing and doing all the financing
Its either that or build cars people actually want to buy
Its either that or build cars people actually want to buy
#4
Suzuka Master
Originally Posted by Steelers Wheels
Since the Big three only seem top make money off the financing, maybe that will be the new business model- selling cars for nothing and doing all the financing
Its either that or build cars people actually want to buy
Its either that or build cars people actually want to buy
![Shrug](https://acurazine.com/forums/images/smilies/shrug.gif)
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#8
I'm the Firestarter
Don't the big three always have these 0% financing deals? How do they make money on those then?
#10
Senior Moderator
...maybe this is will segue DaimlerChrylser solely into the banking business, which is not unheard of.
Manhattan Water Company (orig. 1799) created their own bank back in the 19th century and is now known as JP Morgan Chase & Co. (<--- cliffnotes of a storied history that included and was aparty to the duel between Alexander Hamilton and Aaron Burr.)
That said,
with titan.
![Shrug](https://acurazine.com/forums/images/smilies/shrug.gif)
That said,
![Agree](https://acurazine.com/forums/images/smilies/agree.gif)
Originally Posted by titan
GM should have done that years ago.
#12
Senior Moderator
Originally Posted by heyitsme
GM has GMAC.
![Shrug](https://acurazine.com/forums/images/smilies/shrug.gif)
Disclaimer: I'm under the assumption that DC is looking to establish of full service banking operation as opposed to a DC version of GMAC.
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