BEGINNING JAN. 1, banking giant HSBC will stop underwriting Suzuki’s revolving credit card and installment loans. The manufacturer says it will soon release information on a new retail finance program for 2009.
Suzuki warned dealers last week that HSBC would be sending them a 30-day termination notice. The last paragraph of the short sales bulletin read: “Suzuki continues to hear many great stories with dealers maximizing sales and profits and building strong relationships with local finance sources. As always, Suzuki encourages your dealership to obtain local retail finance sources to complement Suzuki Finance.”
Heidi Byers is finance director for RideNow Powersports, a network of 29 dealerships with corporate headquarters in Tempe, Ariz. She had heard rumors of the change. In October, she told Dealernews, “I’ve heard a little bit of grumbling that Suzuki is looking at another bank, but when you ask them straightforward, they shut that down really fast and say that’s never going to happen. But you never know. They’ve jumped around so much that that is just the nature of the beast.”
HSBC also underwrites Kawasaki’s installment and revolving programs, Polaris’ revolving program and Yamaha’s revolving program. Early this year Polaris filed a lawsuit in district court saying HSBC breached its contract by threatening to tighten lending standards unless Polaris met certain demands.
“As a result of HSBC’s wrongful conduct,” the complaint reads, “Polaris has suffered and will continue to suffer substantial damages through the remaining term of the agreement.”
The five-year agreement had been signed in August 2005. The court ruled against Polaris and in favor of HSBC.