‘Dealer financing’ stimulates trade in used cars

The car lot at In de Wal in Zwolle is a vast sea of used cars. The company sells between ten and fifteen thousand used cars annually. Fifty years ago the In de Wal family started as a wholesale business trading in used cars and motorcycles in Lemelerveld. Grown into In de Wal Automotive Group, the company now consists of various business units including IDW Auto’s (motorcars), IDW Bedrijfsauto’s (commercial vehicles), TaxatieCenter (appraisals), IDW Finance, and the international Joint Venture Imexco.

In de Wal buys cars from large leasing companies. Many of those cars are then exported (partly because the refund on tax on passenger cars and motorcycles is profitable in the current market). Smaller car dealers are another popular sales channel.

Refloating the market
In de Wal saw that many smaller dealers in the market (with which the company has been doing business for years) do not have the financial headroom to purchase enough cars. Due to that lack of financial flexibility, trade has slowed down drastically. It is as if the pipeline had become blocked. Dealers only offer fresh used cars for sale once enough of the existing stock has been sold. And that lack of replacement causes customers to stay away. In order to ‘re-float’ the market, In de Wal and DLL got together and developed a new financing product: dealer financing.

Priming trade
What it basically amounts to is that In de Wal supplies cars to the dealers. The dealers only have to pay for the ‘new’ cars once they have been sold (if a car has not been sold after ninety days, it goes back to In de Wal). The cars that In de Wal supplies to the dealers are financed by DLL. This solution does not affect In de Wal’s financial headroom. The effect of the construction is that the turnover rate at the dealers goes up. Trade is primed, as it were, by dealer financing.

Bridging the gap
Willem Beukenkamp, general manager at In de Wal Automotive Group: “We have linked two fields of expertise together. The financing know-how of DLL and our own knowledge of the market and prices which we have built up as wholesalers during the past decades. Together we have come up with a solution for the gap that the banks are leaving. Nowadays an average car company that has had a few bad years can forget about getting a loan from the bank. We have managed to clear up that bottleneck. Between us we can now ensure that car dealers can continue to offer a fresh supply of used cars.”

Optimum performance
Conclusion: DLL thinks in terms of solutions, not in terms of impossibilities. No matter what the local Rabobanks come up against in the automotive sector, DLL Automotive will definitely be able to help you move forward. Throughout the whole chain we make every effort to help automotive businesses to perform optimally.