LAS VEGAS -

As GrooveCar significantly broadened its network of partners, PenFed Credit Union forged a relationship with CU Direct and the CUDL Network during last week’s NADA Convention & Expo with the expectation of increasing member loans and enhancing overall efficiencies with dealerships.

Beyond the growth in membership and assets, PenFed sees this new partnership as a way to raise awareness of its brand and build strategic business relationships with dealers across the country.

“Growth is a key part of the equation when it comes to PenFed’s ability to consistently deliver low-cost financing for its members,” said James Schenck, president and chief executive officer of PenFed, which boasts 1.4 million members worldwide with nearly $20 billion in assets.

“Joining CU Direct gives us the ability to provide a car buyer with the opportunity to seamlessly apply for membership with PenFed while they simultaneously apply for one of our low rate auto loans,” Schenck continued.

In the past 10 years, CU Direct indicated credit unions have more than doubled auto lending.

With the support of CU Direct's auto lending network, executives believe PenFed Credit Union will offer distinct advantages to both vehicle buyers and dealers. The CU Direct Network will allow PenFed to connect with more than 12,500 dealerships across the U.S. and help to increase their membership and loan volume.

PenFed chief operating officer and executive vice president for business development and community/government affairs Tammy Darvish said, “Partnering with CU Direct and gaining access to its dealer network provides PenFed with an opportunity to establish a presence in new markets, while building greater brand awareness nationwide."

Darvish, a former dealer, mentioned dealerships will also have access to some of the lowest auto loan rates in the country offered by PenFed, which is passed on to buyers. She added the result is a win-win-win for PenFed members, the credit union, and their dealer partners.

In addition, PenFed will offer a unique risk-adjusted pricing approach to new- and used-vehicle financing. PenFed does not require money down on any make or model of vehicle, regardless of year of manufacture. Nor does it increase the interest rate based on the model year of the car.

Executives added that dealers will benefit from this partnership by gaining the ability to build in the costs of aftermarket products into PenFed’s loans.

“The landscape of lending is changing and credit unions like PenFed can see the potential for auto lending growth in front of them," said Tony Boutelle, president and CEO of CU Direct.

“Auto loans are leading portfolio growth for many credit unions across the nation,” Boutelle continued. “We’re excited to partner with PenFed in this effort to bring even more value to auto lending programs for their members.”

GrooveCar adds 40 new credit union partners

GrooveCar, a vehicle buying resource for credit unions and their members, recently brought on 40 new partners, expanding into 19 states. That group includes:

District of Columbia
PEPCO

Florida
Miami FCU
Santa Rosa County

Illinois
Aurora Policemen
Bloomington Postal Employees
Champaign County School Employees
Danville Bell Credit Union
Landmark
Pittsburgh Central
Planites
Tee-Pak Credit Union

Michigan
Motor City Co-op
Polish-American
TLC Community Credit Union
Western Districts Members CU

New Jersey
Credit Union of New Jersey
United Teletech Financial

New York
American Broadcast Employees
CAP COM
Community Resource
Encompass Niagara
FASNY
Health Employees
Northeast Alliance
Rochester Area State Employees
School Systems
Utica Gas & Electric

North Carolina
Ecusta

Ohio
Beacon Mutual
Cincinnati Employee

Tennessee
First Choice Community

Texas
Bayou City
Fannin
HEB Federal
Lubbock Teachers
Members Trust of the Southwest
Northeast Panhandle Teachers
Postel Family
Texhillco School Employees

Virginia
Patent & Trademark Office

The GrooveCar program comes with technical and marketing support to ensure all aspects of the program are easily deployed, usually within a week. Once the decision is made to join, implementation includes a tutorial covering all aspects of the drop and drag format and then a marketing meeting to discuss goals and collateral support materials.

The company added ongoing support, marketing consultations, co-branded materials and guidance are included with most of the packages.

“Auto buying is hitting historic heights and the competition for members’ auto loan dollars is stiff. Our platform is known for delivering a car buying experience to members with all the resources necessary for credit unions to compete at the highest level. The website is loaded with features to capture a member’s interest and generate auto loan leads,” GrooveCar vice president of strategic alliances Rob O’Hara said.

GrooveCar launched its new mobile-responsive vehicle-buying website, earlier this year. GrooveCar insisted credit unions and their members are enjoying next generation design elements, ease of use and the newest enhancements to increase the car shopping experience online.

“SUPRtec (Smart User Preference Resource Technology) is the horsepower behind the site, making it unique to the online buying community. This next generation technology streamlines the user’s preferences, getting them to the car of their dreams,” O’Hara said.

Credit unions earned a 17.6 percent share of the overall vehicle financing market as reported by Experian Automotive.

“Auto loans are the credit unions’ bread and butter,” O’Hara said. “For many credit unions, they recognize a plug and play program is the only way to go. Why try to piece together a product with local dealers, manage it and at the end of the day still not be able to fully provide the resources necessary to run a program of this caliber?”

GrooveCar works with credit unions to provide strong local inventory listing while also utilizing existing relationships a credit union may have with dealerships. Nationally, the program boasts more than 4 million vehicles in inventory.