Your dollars are in his hands. If he cleans up the GMAC mess, taxpayers will be paid back.
Ally Financial Inc. (Ally) will rebrand its GMAC consumer and dealer-related auto finance operations in the U.S., Canada and Mexico and begin using the Ally name next month.
The latest move follows the transition of the GMAC corporate entity to Ally Financial during May 2010.
Both are attempts to leave behind GMAC’s tattered image and distance the company from the wildly unpopular taxpayer financed bailouts of last year.
The Ally brand will be used for auto financing activities in the three North American markets, including activities to support the following manufacturers: General Motors, Chrysler, Saab, Thor Industries and FIAT Mexico.
The U.S. Department of the Treasury last December provided an additional $3.8 billion in capital from taxpayers to GMAC to keep it solvent, in addition to almost $14 billion previously forwarded. (See Taxpayer Owned GMAC Reports Record Q4 Loss and U.S. Takes Controlling Interest of GMAC ) Results for the 2009 fourth quarter and full year were largely affected by losses related to GMAC’s reckless lending practices in its mortgage operations.
The Obama Administration has thus far been unable to implement any reforms whatsoever in financial regulation after the collapse of the Lehman brothers or AIG, among others, in the fall of 2008.
Legacy issues helped weigh down GMAC, even as it picked up new business.
“The move to the Ally name allows us to invest in a brand that we own and can build upon for the long term,” said Ally President Bill Muir. “An ally is someone you rely on to support you, and our new brand embodies our 90-year heritage as a trusted finance source for the automotive industry.”
In connection with the rebranding, Ally will be making a series of changes beginning with:
- Simplifying and streamlining consumer materials and online services to offer a more straightforward approach to auto financing
- Investing in enhancements to the customer service process
- Offering financial tools to simplify the payment calculation process
- Providing opportunities to co-brand and customize certain consumer materials with information from the manufacturer and the dealer
“While our name has changed, our primary focus and core business continues to be automotive financial services,” said Muir. “Our dealer customers and auto partners can count on our ongoing commitment to their success.”
As one of the largest automotive finance companies in the world, Ally extended more than $16 billion of credit to retail customers in the first half of 2010 in the U.S., Canada and Mexico, which represents an increase of more than 120% from the first half of 2009. For the first six months of 2010, the company extended an average of approximately $2 billion of credit per month to consumers in the U.S.
The company’s U.S.-based auto finance products and services will change from GMAC to Ally Financial on Aug. 23, 2010. The auto finance operations in Mexico and Canada will adopt the name Ally Credit on Aug. 16, 2010 and Aug. 23, 2010, respectively.
There will be no change to current customer accounts or billing cycles. Ally’s auto financing operations outside of North America will continue to operate under the GMAC brand as options for further use of the brand are “evaluated.”
In the first quarter of 2010, GMAC Financial Services delivered its first profitable quarter since the fourth quarter 2008. It was the fifth consecutive profitable quarter from the core automotive business
Last November, GMAC announced that its CEO had departed and a new CEO, Michael A. Carpenter, was coming in from the financial services industry and taxpayer subsidized Citigroup. The appointment of Carpenter, with disputed accounts of whether the previous CEO, Alvaro de Molina, was fired or had resigned, raised further questions about the reckless practices of Wall Street, which is responsible for the ongoing Great Recession and the collapse of the global banking system.