Podcast: Automakers pull back on DEI amid social shifts  

Amanda Harris 0:21 Hello everyone and welcome to the road map from auto Finance News. . Since 1996, the nations leading newline and automotive lending and leasing this Monday, September 9th, and Amanda Harris trying by Ashley Savage and James Van Bramer. . This is our weekly rate and what happened in auto finance for the week ending September 6th, 2024 and Economic News, U. .S. . Consumer borrowing increased in July by the most since November 2022, with total credit outstandings up by $25.5 billion in exceeding forecast, according to Federal Reserve data. . The figures aren’t adjusted for inflation. . US job growth, however, fell short of forecast in August as nonfarm payrolls rose by 142,000, bringing the three month average to the lowest level since mid 2020. . The unemployment rate dipped for the first time in five months to 4.2%, reflecting a reversal in temporary layoffs, layoffs in auto finance affordability woes, inventory incentives and used vehicle supply continue to be top of mind trends, impacting the entire industry. . The feds latest edition of the Beige Book reflected dampened auto sales in July and August across most regions, while supply of used vehicles continues to be the largest hindrance to sales of used cars in certified used vehicles, August sales industry wide were helped by hybrids and new 2025 models hitting the market. . Sales were projected to rise 12% month over month and 8% year over year in August, with several large automakers such as American Honda, Ford Motor, Hyundai, Kia, Mazda, Subaru of America and Toyota posting increases on a year over year basis. . Honda, Ford, Hyundai and Kia also all reported increases in hybrid and EV sales. . Incentives are also helping drive sales in market share with captive share surpassing 30% in the second quarter of total auto finance markets. . The captives led the new vehicle market during the quarter, with more than 60% of share, while credit unions led and used vehicle financing last week. . We also did a deep dive into changing dynamics surrounding diversity, equity and inclusion shatters using the industry and James has the details of genes. . James Van Bramer 2:28 Thanks, Amanda. . So there’s certainly a ton of to talk about from the feature. . So whatever I feel to touch on, you can certainly find out more about by reading the feature on our site across pretty much every industry. . There has been at least some social resistance which has changed. . How several companies view diversity equity inclusion. . More recently, we have now seen that include the automotive industry over the past few months, anti DEI campaigns have contributed to companies like Ford and Harley Davidson making changes to their DEI strategies. . But other companies like, say, 10 their and Chase Auto Fill remain committed to their approaches, despite some of this political polarization. . Uh, one way that auto lenders still implement their death strategies as by taking people first approaches and by focusing on human connection. . Uh, so Santander and Chase Auto told me that these are some ways they get past some of that societal backlash and some of the ways to avoid the political polarization by focusing on people rather than any quotas, for example. . And one way that is done is by bringing people in the workplace together, which can be done through resource groups which which is not. . Which? Uh uh brings the the employees together. . We also had some updates in the powersports market and I will turn that over to Ashley. . Ashley Savage 3:57 Yeah. . Thanks James. . So last week, Canadian powersports manufacturer BRP, reported a double digit double digit. . Excuse me, decline in Q2, North American retail sales due to softer retail demand and added incentives from competitors, which is something that we’ve seen across the industry in the first half of this year. . North American sales declined 18% year over year in Q2 of fiscal 2025, which ended July 31st. . BRP, did not break out sales numbers, but CFO Sebastian Martel said on the company’s earnings call that competition was definitely a factor in the declining sales therapies. . Total revenue dipped 33.7% year over year to 1.4 billion U. .S. . Dollars following the company’s ongoing efforts to reduce network inventory levels. . Additional comments made by Martell on the earnings call indicated that the dip in sales and revenue came after the manufacturer found the market in the first half of the year to be a bit more challenging than initially anticipated, Martel was quoted saying. . Our markets have proven to be more challenging than expected so far this year due to weaker industry trends, especially for side by side and personal watercrafts and increased promotional activity from competitors in the form of consumer rebates, dealer incentives and even MSRP reductions therapies. . Latest earnings also emphasized industrywide inventory concerns that we covered in our August powersports feature. . Looking down the line, BRP, is working to reduce shipments through Q4 of fiscal 2025. . Year to Date, Network inventory was down 13% at the end of Q2, according to the earnings presentation and BRP, hopes to reduce shipments by 15 to 20% by the end of the fiscal year. . To further support dealers, Martel said also last week our AFN team announced the speaker line up for our power Sports Finance Summit panel on growth opportunities in motorcycle finance. . The panel joins Power Sport leaders from Harley Davidson horsepower and Motorcycle Industry Council. . I know we’re all really excited for that panel, so if you missed it, you can find more details about that on our site with the latest coverage. . So that’s our latest updates in Powersports. . I’ll pass it back to Amanda for some closing comments. . Amanda Harris 5:56OK. . Thank you, Ashley, James. . And that’ll do it for today’s episodes. . As a reminder, registration is open for the 2024 Auto Finance Summit and the Power Sports Finance Summit returning to Vegas in October. . You can find more information and register at auto finance dot live. . Thank you for joining us on the roadmap and be sure to follow us on X and LinkedIn and we will see you online at autofinancenews.net and here next time.