- 27 -
profit turned on the fleet customer's buying leverage and the
services the independent GM dealer provided to the fleet
customer.
In connection with a purchase of fleet vehicles, GM made
incentives available to fleet customers. As an incentive to
these fleet customers, GM offered below-market interest rate
financing through GMAC or offered to assist a fleet customer in
obtaining below-market interest rate financing from an unrelated
lender. Generally, fleet customers opted to use the below-market
financing provided by GMAC, but occasionally fleet customers used
below-market financing provided by an unrelated lender.
Unlike sales to retail customers, the independent GM dealer
who helped complete a fleet transaction had no role in the
financing of the fleet vehicles purchased. The fleet customer
did not execute an RISC with an independent GM dealer; instead,
GMAC or an unrelated lender lent the money directly to the fleet
customers (fleet loans). In fleet transactions, GMAC used a
chattel mortgage type financing document. GMAC lent the money to
the fleet customers and took a security position in the fleet
vehicles as collateral. Any below-market interest rate offered
to fleet customers on fleet loans was a reduction in GMAC's
otherwise available "lending rate".17
17 GMAC established its lending rate the same way it
(continued...)
Page: Previous 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 NextLast modified: May 25, 2011