Loading ...German Daimler Financial Services Co., the biggest supplier in the world in the commercial vehicles field, has decided to open a financing branch in Romania, activity based almost exclusively on new vehicles.
The German company has opened, last week, Mercedes-Benz Financial Services Romania (MBFRS) through which it hopes to account for a share of 25% on the leasing market in maximum 5 years.
The German company has opened, last week, Mercedes-Benz Financial Services Romania (MBFRS) through which it hopes to account for a share of 25% on the leasing market in maximum 5 years.
Despite prognosis on the further slowdown of the auto market growth pace, big international groups are entering Romania. After Ford, with its plant and subassemblies and after Renault’s expansion, through its research center, Mercedes-Benz arrived with a financing division, Capital review informs.
Jurgen Walker, president of Daimler Financial Services (DFS), says that the entrance on the Romanian market is now “linked to its evolution, to the growth opportunities and to the created critical mass”. Mercedes-Benz Romania, present on this market for two years, has seen a jump in new vehicle sales last year, up to almost 7,000 units.
Romania’s auto market is the third according to size in Central and Eastern Europe, only surpassed by Ukraine and Russia. Last year, new vehicle sales in Romania amounted at 321,000 units, whereas in Ukraine a number of 542,000 units were sold, and in Russia 2.41 million vehicles.
Romania is overtaking Poland – 293,000 cars sold, but also Belarus – 232,000 units. If, last year, the market grew, for the current year a slight decline is expected caused by the international financial problems, harsher local lending conditions, as well as by the high number of second-hand vehicles entering the country.
“Even though we have a problem with the number of used vehicles this year, the situation is expected to normalize next year. We are not too worried because, in fact, the individuals who buy a second-hand car are not Mercedes buyers”, said Michael Grewe, CEO Mercedes-Benz Romania.
Mercedes-Benz Financial Services target for the 5 years to come is a contract volume in the value of at least 300 million euros and a market share in excess of 25%.
Mercedes-Benz Financial Services target for the 5 years to come is a contract volume in the value of at least 300 million euros and a market share in excess of 25%.
Jurgen Walker said that from the 44 countries, where the company is present, in ten of them it has a penetration of at least 45%. On long-term, this is also the target for Romania.
The German company is to offer lending in lei, euro and Swiss franks. “We selected Swiss franks due to the clients’ typology, who are attracted by lower interest rates attached to this foreign currency. Foreign exchange risk is relatively low, if we examine the evolution of leu/frank report in the past years. But it is clear that the main preference will be for lending in local currency”, said Andreas Lehr, director general of the company.
The German financier plans to launch the next year a “leasing full-service”, a package to include all services associated to the acquisition of a vehicle. They include financial or operational leasing, Casco and RCA auto insurance, as well as financing the dealers. The German officials estimate for the following period a greater weight of the financial leasing in the portfolio, but for a longer period of time they expect an increase in the operational leasing. “We also expect a growth in demand for mobility packages, namely the combination of lending, insurance and service in a single instalment”, said Andreas Lehr.
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