Ford Credit Co.'s recent purchase of auto lender and securitizer Triad Financial Corp. from troubled issuer ContiFinancial may spur subprime auto securitization from Ford's Fairlane Credit program, a would-be first for prime-minded Ford.
A spokeswoman for Ford confirmed the automaker has plans to grow Triad's subprime business and looked to securitize from that collateral in the future.
"As our business grows, there's definitely a possibility of doing more of that as a way of clearing out our portfolio," the spokeswoman said.
Triad has collected $1 billion in auto finance receivables since its inception in 1989, and was holding $555 million in subprime auto loans on its portfolio at the time it was sold to Ford.
The sale was finalized two weeks ago, but terms have still not been disclosed. Triad will report to Fairlane Credit.
Fairlane is Ford's finance subsidiary and the world's biggest auto lender. Last week, Ford announced it was consolidating its North American loan service facilities into eight regional centers. The company wants to save money by using new technologies such as automatic dialing to reach more delinquent borrowers and remind them to pay.
Over 4,000 workers will have to relocate to offices in Baltimore, Nashville, Colorado Springs, Dallas and four other cities to be named by September. - SK
