HYUNDAI Capital, a joint venture in the UK with Santander, has commenced underwriting business contract hire for its captive dealers.
Following a pilot launch last year based around the new Hyundai i30 hatchback, Hyundai’s dealers can now choose whether they underwrite with Hyundai Capital or Hyundai’s white label partner ALD Automotive.
President and CEO of Hyundai, Tony Whitehorn, says that both finance houses receive the same terms, and it is simply up to the dealers which they choose to use. Both trade under the Hyundai Contract Hire banner.
In May, 60% of BCH contracts went to ALD and 40% to Hyundai Capital.
Hyundai Capital was formed as a joint venture with Santander in 2013 and operates from its Reigate, Surrey, base. It supplies both Hyundai and Kia with underwriting facilities, although to date Kia has not taken up the business contract hire offering.
“We want to nurture the contract hire side of our business,” explained Whitehorn. “That way we have more control of our customer database. Under the ALD agreement, those contract hire customers are not ours.
“Don’t get me wrong. We have a strong relationship with ALD and rolling agreement – in the end we are almost allowing market dynamics to decide. It might take several years – or maybe months – for it to get really going.
“But if you are going to be a top three player, then you must have your own finance company. So that is the end game. But when? No one has put a date on that.”
Hyundai Capital employs 30 people at its Reigate base. Its MD is Jun Hong while Ian Whittaker is the deputy MD. While the UK Hyundai Capital is a JV, the bank differs depending where you are in the world.
In the States, it’s owned by Hyundai Motors America, and in Germany by Hyundai Capital bank.
Whitehorn said such a piecemeal approach was a way of establishing a presence while ameliorating the risk.