WESTLAKE VILLAGE, Calif. — J.D. Power and Associates discovered that dealer satisfaction with lenders declined "considerably" from 2008 in all four segments reviewed in the Dealer Financing Satisfaction Study.

The company found:

Prime Retail Credit

2008: 835

2009: 789 (down 46 points)

Subprime Retail Credit

2008: 793

2009: 717 (down 76 points)

Retail Leasing

2008: 853

2009: 774 (down 79 points)

Floor Planning

2008: 892

2009: 802 (down 90 points)

Officials explained that the service aspects of the retail financing experience account for more than two-thirds of dealer satisfaction. Meanwhile, offerings such as rates account for less than one-third of overall satisfaction.

While recognizing that the past year has been tough for dealers, J.D. Power executives advised, "This indicates an opportunity for lenders to differentiate themselves through service, even though external market forces are driving a more conservative lending approach."

More specifically, David Lo, director of financial services as J.D. Power, explained, "Current economic conditions have created something of a ‘perfect storm' as declines in new-vehicle sales, tightened lending and reduced inventory funds have combined to put extreme stress on dealer business."

"However, the fundamental principles of service are unchanged. Lenders that focus on prompt application and funding turnaround times, have credit buyers that demonstrate willingness to worth with their clients and have sales representatives who are skilled in relationship management may position themselves to be a lender of choice," he continued.

Basically, the study discovered that higher levels of satisfaction may positively impact the amount of a business a lender receives from a dealer.

For instance, for the lenders in the prime retail segment whose satisfaction scores averaged 712 on a 1,000-point scale, 22 percent of dealers say they "definitely will" increase their business with this organization.

However, of the lenders whose satisfaction scores averaged 886, 46 percent of dealers said they "definitely will" increase business with that lender.

Lo noted, "High-performing lenders tend to close a higher proportion of deals. This is critical right now, and almost more importantly, may serve as a foundation for growth one the market stabilizes."

Prime Retail Credit

Taking the top spot in the prime retail credit segment was Mercedes-Benz Financial with an index score of 918. Officials said this company performed particularly well in two areas, provider offerings and credit personnel. Alphera Financial Services at 910 and BMW Financial Services at 898 followed in the rankings.

The prime retail credit company averages are as follows:

Mercedes-Benz Financial: 918

Alphera Financial Services: 910

BMW Financial Services: 898

Toyota Financial Services: 873

Volkswagen Credit: 867

Audi Financial Services: 838

Honda Financial Services: 831

Union Bank and Trust: 817

Wachovia Dealer Services: 814

Branch Banking and Trust: 803

Ford Credit: 802

Citizens Banks: 792

SunTrust bank: 789

Prime Retail Credit Segment Average: 789

Bank of America: 787

Harris Bank: 781

Fifth Third Bank: 775

Chase Auto Finance: 772

Nissan Motor Acceptance: 763

US Bank: 744

Hyundai Motor Finance: 739

Capital One Auto Finance: 732

GMAC: 711

Chrysler Financial: 665

Subprime Retail Credit

Interestingly enough, J.D. Power said that no awards were presented in the subprime retail credit segment due to insufficient market representation.  

Retail Leasing

For the sixth year in a row, BMW Financial Services grabbed the highest ranking in retail leasing satisfaction with a score of 909. J.D. Power pointed out that this company performed particularly well in the categories of credit personnel, application/approval process and termination policy/service.

Mercedes-Benz Financial followed closely with a score of 908. Toyota Financial Services took home the third ranking with a score of 872.

Retail leasing results:

BMW Financial Services: 909

Mercedes-Benz Financial: 908

Toyota Financial Services: 872

Audi Financial Services: 863

Volkswagen Credit: 862

Honda Financial Services: 857

Ford Credit: 782

Retail Leasing Segment Average: 774

Nissan Motor Acceptance: 755

Chase Auto Finance: 746

Hyundai Motor Finance: 723

US Bank: 714

GMAC: 600

(Included in the study but not ranked due to small sample size were Chrysler Financial and Subaru Motor Finance)

Floor Planning

In addition to capturing the top score in the prime retail credit segment, Mercedes-Benz Financial also ranked highest in floor planning with a score of 926. Next in line was BMW Financial Services at 921 and then Volkswagen Credit at 896.

Floor-planning results:

Mercedes-Benz Financial: 926

BMW Financial Services: 921

Volkswagen Credit: 896

Toyota Financial Services: 872

Chase Auto Finance: 865

Ford Credit: 819

Floor Planning Segment Average: 802

GMAC: 707

Chrysler Financial 678

(Included in the study but not ranked due to small sample size were Bank of America and Nissan Motor Acceptance).

The study examined five key factors to contribute to satisfaction within the prime retail credit, subprime retail credit and retail leasing segments: provider offerings, credit personnel, application/approval process, termination policy/service and sales representative relationship. Three factors were measured in the floor-planning segment: provider offering; floor-plan support personnel and process/service.

The study was based on responses from more than 2,000 dealer principals who were surveyed between April and May of this year.