Tim Marlow, owner of luxury vehicle broker Bridford Financial Solutions, has joined the board of DSG Financial Services as director and shareholder with immediate effect.
The move is a direct result of the withdrawal of ING Lease from funding prestige vehicles as those seeking to replace the multinational lessor, including Investec Asset Finance, begin to circle.
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The move effectively merges DSG, one of the highest-volume brokers, with Bridford, one of the most prominent brokers of funding for luxury vehicles – including £3.5m on the Range Rover Evoque during its first 11 months on sale – a segment that has been surprising resilience during the downturn.
As Tony Gannon, communications director at British Car Auctions, observed in July: “the market for high-value prestige vehicles is exceptionally buoyant, with buyers prepared to invest six figures for the right vehicle.”
Spike in deals
Marlow spoke of a “spike in finance deals” for prestige cars earlier this year w ith £4.4m written in business by Bridford
in March, the month Investec entered the market in exclusive partnership with London Asset Finance.
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By GlobalDataAt the time, Mike Francis, managing director of Investec Asset Finance, noted: “Following a dramatic contraction of the number of lenders and available funds in the high-value vehicles market we see a real opportunity to fill a gap that has developed over the last
two to three years.”
Bridford is changing its branding to DSG Prestige – the high-end vehicle division of DSG begun in February 2011 with a broker facility from ING – with Marlow in charge.ING had also partnered with Bridford and worked with both companies to offer variable rate products on high-ticket vehicles.
Bridford’s main office in Ilkley, West Yorkshire, will be maintained as the base of operations for DSG Prestige, as will dealer arrangements held by Bridford. Marlow’s five closest team members will also be retained by DSG.
Marlow was positive about the prospects for DSG Prestige joining DSG’s “vast array” of lenders and consumer deals with his specialiality in prestige cars, while Richard Hoggart, managing director of DSG, said he was delighted by the appointment.
“The recent withdrawal of ING from the prestige market gave us an opportunity to review this sector,” explained Hoggart.”We believe combining the strengths of Tim’s contacts with our product portfolio and operational expertise creates an excellent solution for prestige car dealers.”
Marlow added that “heading up DSG Prestige is a great step forward and creates an excellent environment to develop a presence in the growing market.”
Market share
The ING pullout is estimated to have left a £1.7bn hole in UK funding, across all sectors, and comes despite the company’s operation in the market being in profit.
With £1.2bn of business written in 2011 and an end-of-year book of £2.7bn, estimates put ING’s share of the £3.7bn
of brokered asset finance in the UK at 30-45%.
Both Aldermore and Hitachi Capital Consumer Finance (HCCF), which entered the UK car finance market in May with a rumoured ambition to do £300m of business a year by 2014/15, are looking to conduct more brokered business.
A statement issued by HCCF in May said: “Unlike many banks and other financial institutions we have no credit constraintsand, as such, have significant ambitions for this market.”
Mark Baird, strategic development manager at HCCF, added the use of an XML proposal feed through Frontline Solutions’ Rosetta system gave the company a “link” and “ability, in conjunction with our broker partners” to refine its proposition to dealers and
brokers.
However, Investec has stated it intends to double its book by 2014 following the ING extraction and holds a partnership
with extreme high-end manufacturer McLaren, as well as that with London Asset Finance. On the back of the London deal, Francis said Investec was “continually looking at ways to expand” and “provide further diversification to our portfolio”, a view he reiterated after
the ING news, speaking of the firm’s “commitment to the market for broker-introduced asset finance”.
Both Investec and Aldermore were confirmed by the National Association of Commercial Finance Brokers, within 36 hours of the ING announcement, as ready to increase funds available to brokered asset finance.
Meanwhile, Royal Bank of Scotland subsidiary Lombard, which withdrew from the broker market in 2009, confirmed it would not return.
fred.crawley@timetric.com & richard.brown@timetric.com
