Captive launches new marine finance product following customer
demand
MAN Financial Services has launched a new marine mortgage
product in the UK amidst reports that it is benefiting from the
credit crunch. It is also planning to almost double the number of
European countries it has businesses during 2008.
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Elliot Lennick, chief executive officer of MAN Finance’s
northern European operations, said that the marine mortgage is
essentially for the growing marine leisure market, and has come
about as a result of demand from MAN engine retailers and dealers,
including the major power boat manufacturers.
He said: “We are rather a novice in the marine mortgage sector
but it was a natural development to support our growing engine
sales with the appropriate product to buy them. We also provide
floor-stock funding for dealers who are MAN Group appointed
agents.”
The launch comes at a time of expansion for MAN Finance
internationally. The company is currently operative in some 11
European countries, but by the end of 2008 hopes to have expanded
to a total of 20 countries.
Lennick is currently in charge of developing MAN Finance
operations in the UK, Ireland, Norway, Sweden, Denmark and Iceland.
He said that new operations are set for CEE countries such as,
Rumania, Hungary, the Czech Republic and Slovakia, as well as the
Middle East and South America.
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By GlobalData“The overseas operations,” he stressed, “will mirror the UK
business with sales staff working within regional areas and
answerable to regional management. Products will range from hire
purchase to operating and finance leases and other loans with
balloon rentals.”
In recent weeks MAN’s chief financial officer, Karlheinz
Hornung, is reported in The Financial Times as reaping benefits
from the subprime crisis by offering its truck customers cheaper
leasing rates than those offered by big banks.
MAN reportedly has a leasing business worth €2.5bn and provides a
leasing agreement for just less than a quarter of its trucks.
Given the size of MAN trucks, leasing deals can be weighty.
Commercial vehicles range from the MAN TGL 7.5 tonne 4×2 Rigid
Chassis to the 44 Tonne TGX Tractor Units – which means that
average deal size per vehicle are in the region of £40,000. Even
used units don’t come cheaper than £15,000 to £20,000.
Finance penetration is high for the product range with
penetration levels around the 40 per cent mark in the UK. Other
non-MAN assets are financed but only if doing so does not interfere
with customers’ credit lines. MAN Group retails around 10,500 units
currently in northern Europe.
At present MAN Finance in the UK operates from its Swindon head
office, where it employs some 42 staff. Lennick is in the process
of setting up the Northern Europe region. The new MAN Finance
regions are due to be fully up and running by mid-2008.
MAN Finance marine mortgages are set at a maximum term of 10
years and any registration or security fees can be added to the
loan. Payments are fixed and charges are set to a notional base
rate. Fluctuations to base rates during the period of the mortgage
are adjusted to the length of the term. In addition, lump sums can
be paid at any time enabling the term of the mortgage to be
amended.
