Wednesday, Jan. 24, 2007, 07:00 PM UPDATED 11:59 AMBy Nick Zulovich
FORT WORTH, Texas — AmeriCredit officials confirmed Wednesday that Gayle Pavlicek, former senior vice president of remarketing, has left the company to start her own business. Taking over the reins for the interim will be Scott France, executive vice president of AmeriCredit's specialties side, executives told SubPrime Auto Finance News.
This announcement comes not long after AmeriCredit completed its acquisition of Long Beach Acceptance Corp.
John Hoffmann, vice president of public relations and communication for AmeriCredit told SubPrime Auto Finance News Wednesday, "Gayle has left the company and Scott will be the interim director of remarketing. He works on what we call our specialties side."
With the acquisition of Long Beach complete, AmeriCredit has become a full-spectrum lender, joining the ranks of other full-spectrum lenders that specialize in working with dealers to get consumers behind the wheel regardless of where they fall on the spectrum — whether it be prime, near-prime or subprime.
"It (Long Beach) fills that last remaining niche," said Mark Floyd, AmeriCredit's executive vice president and chief operating officer of servicing, discussing the recent acquisition with SubPrime Auto Finance News.
"We wanted to offer the full spectrum of financing, and the Long Beach acquisition allows us to fill that gap in our product offerings, with Bay View at the top. Long Beach was a nice strategic fit," he pointed out.
According to Floyd, Long Beach does about $1 billion a year in volume, which means AmeriCredit will pick up that added business as the near-prime lender becomes a stand-alone subsidiary of AmeriCredit.
In terms of dealer relationships, Long Beach brings more than 2,600 to AmeriCredit. Floyd noted that the majority of these relationships will be new to his company, as only a small portion overlap with the more than 14,000 dealers AmeriCredit already does business with.
Prior to the acquisition, Long Beach was the near-prime auto finance subsidiary of ACC Capital Holdings. AmeriCredit's purchase was an all-cash transaction valued at $282.5 million. Long Beach was founded in 1995 and has its headquarters in Paramus, N.J., with a Western regional office in Orange, Calif. Stephen Prough, president and chief executive officer of Long Beach, will continue to lead the company, AmeriCredit said.
Although AmeriCredit has its own score card, Floyd said the company's near-prime business will include consumers who fall into about the 620 to 680 FICO score range, or slightly above. The company will not only rely on its custom score card, but also factor in other aspects of a consumer's life, such as length of employment, time of residence at the same place and more.
Thinking back earlier in the decade to when AmeriCredit was struggling to regain ground and restructure, Floyd recalled, "As we started to grow again in 2004, it was to broaden our spectrum of product offerings, or our core business, and reach into prime. When Bay View became available, we saw the opportunity to fill a gap, just as we did with Long Beach. We just decided to buy versus build in these instances. Long Beach has had so much success, it just made sense for us.
"Back when we were restructuring, we had a vision we would be a strong company again. How quickly a company can get there is hard to predict, but we don't want to become complacent," Floyd said.
When it comes to future acquisitions, Floyd said it's hard to know what the future will bring, but that the company will keep an open mind to future purchases.
Despite all the behind the scenes work and expansion, Floyd said one of the most important factors of AmeriCredit's business is the company's dealer partners.
"Relationships are a very important part of AmeriCredit's business," he noted. "That's what we build our business on and what we've built our recovery on. Our relationships are also what we will build our future on.
"It all starts with dealer relationships," he continued. "That has always been very important to AmeriCredit and will continue to be. We constantly ask and look for their back and encourage our dealer partners to talk to us."
Floyd said dealers have embraced AmeriCredit's recent expansion.
"Overall, dealers have been very positive, as evidenced in the fact that we continue to get a significant amount of new volume," Floyd said.
As another part of the company's expansion plans, it has recently been reaching out to more independent dealers.
"Our work to increase the number of independent dealers we do business with is going as planned — slow and methodical. We are very pleased with the results and continue to expand," Floyd told SubPrime Auto Finance News.
Dealers with questions or who would like to sign up with AmeriCredit are invited to call the company's Dealer Services Solutions department at (888) 556-4616.
AppOne, AmeriCredit Alliance Rolled Out Nationally
As a part of AmeriCredit's plan to reach out to more independents, the company recently teamed up with AppOne, which works exclusively with independent dealers. Not long after the partnership began, AppOne announced the national rollout its alliance with AmeriCredit.
The alliance offers AmeriCredit the capability of receiving credit applications from more than 1,100 independent auto dealers within AppOne's nationwide dealer network. These dealers connect to AmeriCredit through the AppOne platform.
The pilot program, started in October, has expanded to include 14 states: Alabama, Florida, Georgia, Louisiana, Mississippi, New Jersey, New York, North Carolina, Ohio, Oklahoma, Pennsylvania, South Carolina, Tennessee and Texas.
In addition, the program will further expand to include all 48 states within the continental United States by February 2007.
"AppOne's growing dealer base enabled AmeriCredit to gain immediate market share in the underserved independent auto dealers market," said Kyle Birch, AmeriCredit's executive vice president of Dealer Services.
"The ability to complement our existing risk management efforts through AppOne's platform provides us with an even greater opportunity to expand our independent dealer business," Birch added.
"This partnership provides our dealers with added financing alternatives, obtainable through AmeriCredit, a leading financing provider in the United States and Canada," explained Lee Domingue, AppOne's chief executive officer.
"Having access to a key financing source such as AmeriCredit allows independent auto dealers to compete more effectively against franchise owners who are moving into the used-car market space," he continued.
AppOne's services are accessed through its Web-based loan origination platform for independent auto dealers. Elements of the AppOne portal include DealerOne, a dealer underwriting system; RECON, a dealer scoring system; and DMSOne, a software management system for independent auto dealers.
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