Toyota launches financial services company
Toyota Motor Group today launched Toyota Financial Services (Ireland) in Dublin.
The company, which expects to write around €70m worth of business in its first year, is a joint venture between Toyota Financial Services, Toyota Motor Corporation’s international finance arm, and Toyota Ireland - the 100pc Irish-owned distributor of Toyota and Lexus cars in Ireland.
In order to cater for the expected demand for its car finance products, the company it to create 25 new jobs at its Dublin headquarters.
In May of last year the Irish Independent revealed that the motor group was understood to be in the process of establishing its own bank in Ireland to provide car finance directly to customers. At the time a Toyota spokesperson declined to comment.
Toyota Financial Services currently has around €160bn in assets under management throughout the world, however this is the first time it has entered into such an agreement with a national distributor.
At today's launch Minister Michael D’Arcy TD, Minister of State for Financial Services described the launch as "a significant vote of confidence in the Irish economy."
Mr D’Arcy went on to say that the venture was a powerful signal to the international financial services industry that the financial services arm of the world’s largest motor manufacturer has entered the Irish market in partnership with Toyota Ireland.
Also in attendance at the event were Mr. Shinya Kotera, senior executive vice-president, Toyota Financial Services Corporation, Mark Templin, chief operations officer of Toyota Financial Services Corporation, Steve Tormey, chief executive, Toyota Ireland, and François Radot, chief executive, Toyota Financial Services (Ireland).
"We predict Toyota Financial Services (Ireland) will have a significant impact on the Irish motor market and we would expect to write somewhere in the region of 4,000 new and used contracts in the coming 12 months with a total value in excess of €70m," Steve Tormey, chief executive of Toyota Ireland, said.
Personal contact plan rates with Toyota Financial Services will start at 2.9pc, and average at 3.9pc, the company said.
In setting up a private bank in Ireland, Toyota joins a list of other car manufacturers which have already established private banks in Ireland, including Volkswagen.
Car makers have been stepping up their activity in offering consumers attractive financing deals in a low interest rate environment, and at a time when car sales across the country are declining.
Sales have been hit by weakened sterling, which has resulted in a UK car buying spree by Irish consumers.
Earlier this week it was revealed that banks owned by car companies loaned almost €1bn to Irish motorists last year.
The 'big three' - BMW, Renault and Volkswagen banks - recorded increases of between 1.5pc and 7pc, according to figures obtained by the Irish Independent.
The increase in total lending volumes (to almost €950m) came despite the fact there was a 10.4pc fall in new car sales last year.
The rise appears to reflect industry sentiment that people are increasingly financing their cars through such lending institutions - as well as opting for higher-spec, more expensive models.
Volkswagen Bank led the charge, loaning €500m in 2017 – an increase of 7pc on 2016.