Detroit’s Ford, Wolfsburg’s Volkswagen to exit auto finance business in India

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Detroit’s Ford, Wolfsburg’s Volkswagen to exit auto finance business in India

The auto financing wings of Detroit carmaker Ford Motor Co and German automotive industry behemoth Volkswagen AG, had been brewing off an option to stop proffering new credits to car dealers alongside buyers in India, while the auto giants’ financing wings have been set to exit the country following a number of incidents where customers had failed to make repayments, sources familiar with the subject-matter had unveiled later this week on condition of anonymity given an upscaled sensitivity of the issue.

In point of fact, latest move from the United States’ second-largest conventional automaker Ford Motor Co alongside the largest European automotive giant Volkswagen AG, came forth as the German auto Goliath’s financing wing, Volkswagen Finance Private Ltd., had stopped offering debts to car buyers in India last year, while the VW entity had told all Volkswagen brands’ dealers in India including Volkswagen, Skoda alongside Audi to find other financing sources in May this year, the sources said.

VW, Ford set to wind up car financing unit in India

On top of that, a press agency report had quoted two unnamed sources as saying that a large number of VW car owners in India had botched to pay off their debt-loads during the pandemic, inflicting deeper wounds into Volkswagen’s finance unit, and the unit would quit the country by December 31, 2021.

If truth is to be told, over 50 per cent of Volkswagen dealers in India used to depend on the group’s finance arm for proffering credits to their customers, which seemingly added further strains on VW’s finance unit.

Nonetheless, Volkswagen’s finance unit had quoted saying in a statement that it had taken over a controlling stake in an Indian loan brokerage portal KUWY Technologies, under which the unit would continue to serve its retail buyers, signalling a shimmering ray of hope at the end of tunnel for thousands for VW customers who had been vying to vent out a way to make repayments for their purchases.