Continuing the speed of executive turnover in 2020, in the first quarter of 2021, China Banking and Insurance Regulatory Commission approved the executive turnover of two auto finance companies.
According to the information of official website, China Banking and Insurance Regulatory Commission, China, the Shanghai Banking Insurance Regulatory Bureau approved the qualification of deputy general manager of Ford Motor Finance (China) Co., Ltd.; Shandong Banking Insurance Regulatory Bureau approved the qualifications of general manager and deputy general manager of Shandong Haowo Automobile Finance Co., Ltd..
Frequent changes in senior management of auto finance companies are mainly related to daily personnel changes, but more people still hope to actively cope with the pain of transformation and change faced by auto time Finance after the epidemic by introducing experienced professionals and forming high-quality management teams.
Old and new changes in senior management team
Since the opening of the first auto finance company in 2004, it has been common for executives to change in the industry.
As far as the position of chairman is concerned, according to the statistics of China Banking and Insurance Regulatory Commission official website’s reply, 21 of the 25 licensed auto financing companies have changed the position of chairman in the past 10 years, involving 36 senior executives. Among them, 10 auto finance companies such as SAIC-GM, Changan Automobile Finance, Ford Automobile Finance, Chery Huiyin Automobile Finance, Fiat Chrysler Automobile Finance, Volvo Automobile Finance, BMW Automobile Finance and Volkswagen Automobile Finance have changed their chairmen at least twice since their opening.
It can be seen that among the above-mentioned auto finance companies with executive changes, the manufacturers with both wholly foreign investment background and Sino-foreign joint venture background are auto finance companies, including Ford Auto Finance, Fiat Chrysler Auto Finance and Volvo Auto Finance, and there are many foreigners among the executives involved in the changes.
In recent years, several head auto finance companies established earlier have also changed frequently in the senior management team. For example, Volkswagen Finance has changed in the positions of chairman, general manager, director, chief operating officer and chief risk control officer. In recent years, Toyota Motor Finance has successively appointed a new general manager and several deputy general managers.
The Financial Times reporter also noticed that most of the senior executives of foreign-funded or Sino-foreign joint venture auto finance companies are directly transferred from the outside by shareholders, and less are transferred from within the company.
At the policy level, it should be noted that the regulatory authorities have put forward higher requirements for the management ability of senior executives of auto finance companies. In January this year, China Banking and Insurance Regulatory Commission requested in the Guiding Opinions on Establishing and Perfecting the Performance Pay Recourse and Deduction Mechanism of Banking and Insurance Institutions that when financial institutions, including auto financing companies, have serious regulatory indicators that are not up to standard or deviate from the reasonable range, and major risk events occur, which have a bad impact on the financial market order, the performance pay and other incentive pay of senior managers and key positions should be recovered and deducted.
The automobile industry is in a period of deep adjustment.
Under the new development pattern of double circulation and the prudent supervision trend of financial innovation, auto finance companies will continue to gain policy inclination, but at the same time they will also face a stricter supervision environment. The industry expects new executives to lead auto finance companies out of the "comfort zone" and actively adjust their development ideas to better adapt to the new requirements and changes of the auto finance industry in the new era.
In fact, behind the frequent turnover of executives of auto finance companies is the auto market that is in a period of deep adjustment. Although the automobile market shows strong development resilience, the automobile production and sales volume has declined slightly for many years.
According to the statistics of China Association of Automobile Manufacturers, in 2020, the national automobile production and sales will reach 25.225 million and 25.311 million respectively, down by 2.0% and 1.9% year-on-year.
From the supply side and demand side, the epidemic has limited impact on medium and long-term automobile production, but it will affect consumers’ demand for automobile purchase, and there is the possibility of delaying or terminating the demand for automobile purchase, which will directly affect the development of C-end consumer credit of automobile finance, especially for companies that rely on offline dealer service mode, it is urgent to transform online and digitally and broaden the channels for obtaining customers.
Combined with the rapid change of mass consumption habits and consumption concepts, the deep integration of online and offline auto finance is the general trend, and the auto market is also gestating the "new four modernizations" power of electrification, networking, intelligence and sharing. Based on this, the corresponding digital transformation of auto finance companies is a long-term systematic work.
Some experts in the industry believe that under the new situation, the digital development of auto finance can focus on six aspects, including online marketing, focusing on expanding online marketing models based on social interaction and fans; Online service, moving pre-loan, in-loan and post-loan services online through technical means; Online branding can form a brand communication synergy according to the communication characteristics of different platforms; Online products, exploring and designing innovative financial products that meet the needs of online users; Customers are online, and online customers are managed throughout their life cycle; The risk control is online and transformed into a direct-customized risk control mode.
The effectiveness of executives’ performance needs to be improved
In the automobile industry chain, flexible automobile financial products are becoming a new driving force to promote automobile consumption, which has a positive effect on promoting automobile sales and improving customer stickiness. Therefore, the frequent replacement of senior executives in the auto finance company industry in the past two years is also related to the acceleration of the overall transformation of the industry. Under the trend of strict supervision, a series of new regulations related to auto finance were issued, which directly affected the strategic direction and business layout of institutional transformation.
While auto financing companies are facing various transformation pressures, in the auto financing market, the competition among different types of institutions, such as banks, manufacturers, internet auto financing platforms and financial leasing companies, tends to be fierce, which increases the difficulty of auto financing companies’ transformation to a certain extent.
Judging from the recently released regulatory signals, compliance will be the core issue that senior executives of auto finance companies should focus on.
The article "Improving Corporate Governance of Non-bank Institutions, Tamping the Cornerstone of High-quality Development" published by China Banking and Insurance Regulatory Commission official website in early February pointed out that there is still a gap between the governance level of four types of non-bank institutions such as auto financing companies and the requirements of high-quality development, and the willingness and ability of relevant governance subjects to perform their duties need to be strengthened, and the internal system construction and execution still need to be improved. Among them, the key issues such as shareholders’ behavior is not prudent, the management of related party transactions is not in place, the incentive and restraint mechanism needs to be more "risk-oriented" and the effectiveness of directors, supervisors and senior management needs to be improved.
关于作者