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Consumer Automotive Financial Services in France

  • December 2015
  • -
  • Finaccord
  • -
  • 57 pages

Consumer Automotive Financial Services in France investigates the market for automotive financial services linked to sales of new and used passenger cars to individual buyers in France. In addition to analysing the market for finance and leasing services, the study also covers creditor insurance, motor insurance, road assistance, extended warranties, GAP insurance and prepaid service contracts.

Using survey results for average take-up rates for finance and leasing propositions at the point of sale, data for the size and growth of the automotive finance and leasing market for consumers in France is provided in terms of gross advances and assets leased for 2011 to 2015 with splits between finance for new and used cars and between finance organised through dealerships at the point of sale and directly with banks or other lending institutions.

Moreover, also by means of data for average take-up rates, the markets for creditor insurance, motor insurance, road assistance, extended warranties, GAP insurance and prepaid service contracts are sized in terms of gross written premiums and other revenues sold through the automotive trade (i.e. via dealers and manufacturers) in 2015. These markets, estimated to be worth EUR 2.23 billion in total in 2015, are broken down between new and used cars, and between new contracts sold during 2015 and in-force business sold in previous years but still being renewed in 2015.

The report draws on a survey of 85 leading car dealerships as well as an analysis of the approach to consumer automotive financial services of 42 car manufacturer brands in France. The PartnerBASE™ dataset that accompanies the report details each of the marketing initiatives for consumer automotive financial services traced by Finaccord for both dealers and manufacturers; a market data annexe is also available in a convenient spreadsheet format so that there is no need to re-enter key data points from the report.

In addition to captive finance companies owned by manufacturer brands, organisations covered by the report include ACTA Assistance, ALD Automotive, AXA, Cetelem, CGI, Covéa Fleet, Europ Assistance, Financo, Gras Savoye, Icare, Inter Mutuelles Assistance, NEXX Assurances, Opteven, SATEC and Viaxel. Together, the report and database will provide you with the definitive guide to current and future opportunities in consumer automotive financial services in France.

Table Of Contents

Consumer Automotive Financial Services in France
00 EXECUTIVE SUMMARY 1
10 INTRODUCTION 3
What is this report about? 3
The focus of the report is on financial services related to the sale of passenger cars to individuals 3
Rationale 3
The provision of financial services is essential to support both car sales and profitability 3
This report offers a detailed updated analysis of the subject in France based on primary research 3
Methodology 3
Survey of dealers and manufacturers 3
Market data 5
Computation of market data is based on a complex set of assumptions and variables… 5
…in order to provide market segmentations in unrivalled detail 5
External sources 6
Definitions 6
Finance and leasing products 6
Insurance, warranty and assistance products 7
Operating models 8
Tied and non-tied providers 8
Abbreviations 8
PartnerBASE and market data annexe 8
Finaccord 9
20 MARKET ANALYSIS 11
Introduction 11
Passenger vehicle data 12
Sales of new and used cars have picked up slightly from the trough reached in 2013 12
Three manufacturer groups account for over 70% of new car sales 13
Consumer automotive finance and leasing market 14
Market size and growth 14
Finance contracts concluded via dealers are likely to have risen quite rapidly in 2015 14
The fastest growth by value has been for used car finance arranged at the point of sale 15
Types of finance and leasing product 17
Two types of finance product account for close to 90% of the point-of-sale market 17
Consumer automotive insurance, warranty and assistance markets 18
Market sizes 18
In total, the automotive trade is likely to have sold policies worth around EUR 223 billion in 2015… 18
… which means that it is driving out increasing value from these products 18
Survey of automotive dealers and manufacturer brands - overview 21
Introduction 21
Provision of consumer automotive financial services 21
Many French dealers appear to have given up on intermediating motor insurance… 21
… although enthusiasm remains high for other automotive financial services 21
Number and nature of dealer schemes 23
French dealers commonly work with more than one partner for most automotive financial services 23
Types of creditor insurance policy sold by dealers 25
It is usual for comprehensive creditor insurance policies to be made available with automotive finance 25
CONSUMER AUTOMOTIVE FINANCIAL SERVICES IN FRANCE
© FINACCORD (12/2015) II
Types of motor insurance policy sold by dealers 26
All motor insurance policies sold through dealers include both liability and other types of cover 26
Sources of road assistance distributed by dealers 27
Road assistance is often bundled with other automotive financial services 27
Consumer uptake of automotive financial services through dealers 28
Take-up rates for point-of-sale finance in France have increased substantially since 2013 28
and have also risen markedly for extended warranties, GAP insurance and prepaid service contracts 28
Survey of automotive dealers and manufacturer brands - partnerships 30
Introduction 30
Finance and leasing 31
CGI, Cetelem and Viaxel remain the dominant non-tied providers in France 31
albeit four other competitors are also present 31
Almost all manufacturer brands collaborate with a captive or preferred finance provider 33
among which RCI Banque is the largest by weighted share of partnerships 33
while CGI is the leading non-captive provider 33
Across all types of provider, the leading firm has an implied market share of new business of 231% 35
Creditor insurance 36
There are eight main non-captive competitive units operating in this market 36
AXA has improved its position by acquiring the lifestyle protection business of Genworth Financial 36
Motor insurance 38
When dealers sell motor insurance, they always focus on manufacturer-branded policies 38
Amaline, Avanssur and NEXX are the leading underwriters by weighted share of partnerships 39
Extended warranties 41
Covea Fleet, Icare and Opteven have a significant presence in their own right and through finance houses 41
Extended warranties are available from all manufacturer brands surveyed apart from one 43
… with Covea Fleet, Icare and Opteven again prominent in this sector 43
The Warranty Group supports six manufacturer brands through FCA Capital 43
A combined analysis attributes over a fifth of the market to the leading competitor 45
Road assistance 46
Road assistance can be distributed in a variety of different formats 46
Four main competitors compete for manufacturer brand mandates for road assistance… 48
… with Inter Mutuelles Assistance the leader in the weighted analysis of partnerships 48
GAP insurance 50
Non-tied GAP insurance propositions are invariably intermediated by finance and leasing providers 50
Covea Fleet is by far the leading non-captive insurer working with manufacturer brands 52
Prepaid service contracts 54
ALD Automotive features in more than one third of all non-tied relationships mentioned by dealers 54
… with Icare and Opteven visible as other non-tied providers in this growing sector 54
Opteven claims the most important partnerships with manufacturer brands using an external provider 56

LIST OF GRAPHICS / TABLES

00 EXECUTIVE SUMMARY 1
Key market data for consumer automotive financial services in France, 2015 2
10 INTRODUCTION 3
20 MARKET ANALYSIS 11
Passenger car parc and new / used passenger car sales in France, 2011 to 2015 12
Passenger car parc and new / used passenger car sales in France, 2011 to 2015 (table) 13
New passenger car registrations in France, segmented by manufacturer group, 2015 13
New and used passenger car finance market in France, segmented by distribution channel: volumes, 2011 to 2015 14
New and used passenger car finance market in France, segmented by distribution channel: values, 2011 to 2015 15
New and used passenger car finance market in France, segmented by distribution channel: values and volumes, 2011 to 2015 (table) 16
% split between the different types of finance and leasing contract organised at the point of sale in France, 2015 17
Total revenues from consumer automotive insurance, warranty, assistance and service contract markets in France, 2015 19
Total revenues from consumer automotive insurance, warranty assistance and service contracts in France, 2015 (table) 20
Comparison of the provision of each type of automotive financial service by dealers and manufacturer brands in France, 2015 22
Average number of tied and non-tied schemes organised by dealers for each type of automotive financial service in France, 2015 (table) 23
Average number of tied and non-tied schemes organised by dealers for each type of automotive financial service in France, 2015 24
% split between the different types of creditor insurance policy sold at the point of sale in France, 2015 25
% split between the different types of motor insurance policy sold at the point of sale in France, 2015 26
% availability of road assistance through factory warranties, annual servicing, extended warranties, motor insurance, prepaid service contracts and as a stand-alone product in France, 2015 27
% of new and used car purchasers acquiring each type of automotive financial service at the point of sale in France, 2015 29
Provision of finance and leasing by dealers in France, 2015: provision rate, product sources and provider share of non-tied partnerships 32
Provision of finance and leasing by manufacturer brands in France, 2015: provision rate, operating models and weighted provider share of partnerships 34
Implied market shares of new business for finance and leasing in France, 2015 35
Provision of creditor insurance by manufacturer brands in France, 2015: provision rate, operating models and weighted provider share of partnerships 37
Provision of motor insurance by dealers in France, 2015: provision rate and product sources 38
Provision of motor insurance by manufacturer brands in France, 2015: provision rate, operating models and weighted provider share of partnerships 40
Provision of extended warranties by dealers in France, 2015: provision rate, product sources and provider share of non-tied partnerships 42
Provision of extended warranties by manufacturer brands in France, 2015: provision rate, operating models and weighted provider share of partnerships 44
Implied market shares of new business for extended warranties in France, 2015 45
Provision of road assistance by dealers in France, 2015: provision rate, product sources and provider share of non-tied partnerships 47
Provision of road assistance by manufacturer brands in France, 2015: provision rate, operating models and weighted provider share of partnerships 49
Provision of GAP insurance by dealers in France, 2015: provision rate, product sources and provider share of non-tied partnerships 51
Provision of GAP insurance by manufacturer brands in France, 2015: provision rate, operating models and weighted provider share of partnerships 53
Provision of prepaid service contracts by dealers in France, 2015: provision rate, product sources and provider share of non-tied partnerships 55
Provision of prepaid service contracts by manufacturer brands in France, 2015: provision rate, operating models and weighted provider share of partnerships 57

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