Volkswagen Financial Services U.S. and Wells Fargo announce cooperation agreement for vehicle purchase financing of Volkswagen, Audi, and Ducati brands in the United States

Rhea-AI Summary

Volkswagen Financial Services (VWFS) and Wells Fargo (NYSE: WFC) have announced a multi-year co-branded agreement for vehicle purchase financing in the United States. Under this partnership, Wells Fargo will become the preferred purchase financing provider for Volkswagen, Audi, and Ducati brands, starting from April 2025. VWFS will continue to lead customer experience, focus on consumer leasing, and develop usage-based products, including mobility solutions.

The agreement covers more than 600 Volkswagen, 300 Audi, and 130 Ducati dealerships in the U.S. This strategic move aims to respond to evolving market dynamics and support Volkswagen Group's growth strategy in the U.S. market. VWFS will continue to service existing customer contracts and maintain its role in supporting brand and dealer relationships.

Positive

• Strategic partnership with Wells Fargo to provide new U.S. consumer retail financing
• VWFS retains focus on consumer leasing and usage-based products, including mobility solutions
• Expansion of financing options for over 1,000 dealerships across Volkswagen, Audi, and Ducati brands
• Potential for improved customer experience through dedicated purchase financing from Wells Fargo

Negative

• Transition of retail financing services to Wells Fargo may impact VWFS's market share in this segment
• Potential challenges in integrating Wells Fargo's services with existing VWFS operations

News Market Reaction

+1.91%

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+1.91% News Effect

On the day this news was published, WFC gained 1.91%, reflecting a mild positive market reaction.

Data tracked by StockTitan Argus on the day of publication.

- Wells Fargo will provide new U.S. consumer retail financing for vehicle purchase as a co-branded offering, with an estimated transition beginning in April 2025
- VWFS continues to lead VWGoA financing solutions for brand and dealer relationships while prioritizing consumer leasing and delivering usage-based products, including mobility solutions

RESTON, Va. and SAN FRANCISCO, Sept. 16, 2024 /PRNewswire/ -- Volkswagen Financial Services (VWFS), the captive financial services arm of Volkswagen Group of America, and Wells Fargo (NYSE: WFC) today announced a multi-year co-branded agreement under which Wells Fargo will be the preferred purchase financing provider for the Volkswagen (VW), Audi, and Ducati brands in the U.S. market. This new relationship is intended to begin for Audi and VW dealers and consumers beginning in April 2025, with Ducati to follow. VWFS will continue to service existing customer contracts.

Volkswagen Financial Services will continue to lead the customer experience in the U.S. market with Volkswagen, Audi, and Ducati brand partners and dealers. After this transition, VWFS will focus on consumer leasing and usage-based products, including mobility solutions, supporting Volkswagen Group's growth strategy in the U.S.

"We continuously evaluate our global business to make bold decisions that best position us in each of our markets," said Pablo Di Si, President and CEO, Volkswagen Group of America. "By aligning ourselves to respond to evolving market dynamics through this partnership, we're able to more effectively support the needs of Volkswagen, Audi, and Ducati while providing tremendous opportunities for Volkswagen Financial Services in the U.S. market in the future."

"This is a union of great strengths, as Volkswagen Financial Services U.S. will remain the host of automotive expertise, supporting our brands, dealers, and customers, while Wells Fargo will join us in offering their retail financial services capabilities and comprehensive balanced book to offer outstanding retail solutions," said Ernst Jan van Eijkelenburg, President and CEO for VW Credit, Inc., and Region Manager for the North American Region.

Under the terms of the agreement, Wells Fargo will provide a dedicated purchase experience for more than 600 Volkswagen, 300 Audi, and 130 Ducati dealerships in the U.S.

"We are proud of working with Volkswagen Financial Services U.S. to take another significant step forward in the ongoing transformation of our Auto business," said Tanya Sanders, head of Wells Fargo Auto. "Our two companies share a commitment to continuously innovating and creating great experiences, and this relationship will deliver a superior experience for VW, Audi, and Ducati dealers and customers."

Additional information may be found at https://www.volkswagengroupofamerica.com and www.wellsfargo.com.

About Volkswagen Group of America
Volkswagen Group of America, Inc. (VWGoA) is a wholly owned subsidiary of Volkswagen AG, one of the world's leading automobile manufacturers and the largest carmaker in Europe. VWGoA houses the U.S. operations of a worldwide family of distinguished and exciting brands including Audi, Bentley, Lamborghini, and Volkswagen and is the sole importer and distributer of Bugatti and Rimac vehicles in the U.S. VWGoA also operates a state-of-the-art assembly facility in Chattanooga, Tennessee which produces Volkswagen brand vehicles including the Atlas, Atlas Cross Sport, and the ID.4. VW Credit, Inc. (doing business as "Volkswagen Financial Services"), a wholly owned subsidiary of VWGoA, provides financial services and innovative mobility solutions. Electrify America, another VWGoA subsidiary, is building a publicly-accessible, nation-wide electric vehicle charging network. VWGoA's autonomous vehicle (AV) technology subsidiary, ADMT LLC, tests and proves AV technology. VWGoA's headquarters are in Reston, Va. The company has approximately 10,000 employees in the United States and sells its vehicles through a network of approximately 1,000 independent dealers.

About Volkswagen Financial Services
VW Credit, Inc., dba Volkswagen Financial Services (VWFS), was founded in 1981 as the captive financial services arm of Volkswagen Group of America, Inc. and is affiliated with Volkswagen of America, Inc., Audi of America, Inc. and Ducati North America, Inc. VWFS offers services to Volkswagen, Audi, Ducati customers, and authorized dealers as Volkswagen Financial Services, Volkswagen Credit, Audi Financial Services, and Ducati Financial Services. The company offers competitive financial products and services to customers and authorized dealers in the United States. VWFS is headquartered in Reston, VA.

About Wells Fargo
Wells Fargo & Company (NYSE: WFC) is a leading financial services company that has approximately $1.9 trillion in assets. We provide a diversified set of banking, investment and mortgage products and services, as well as consumer and commercial finance, through our four reportable operating segments: Consumer Banking and Lending, Commercial Banking, Corporate and Investment Banking, and Wealth & Investment Management. Wells Fargo ranked No. 34 on Fortune's 2024 rankings of America's largest corporations. In the communities we serve, the company focuses its social impact on building a sustainable, inclusive future for all by supporting housing affordability, small business growth, financial health, and a low-carbon economy. News, insights, and perspectives from Wells Fargo are also available at Wells Fargo Stories.

"Volkswagen", "Audi," "Ducati", all model names and the Volkswagen logo are registered trademarks of Volkswagen AG. All other trademarks are the property of their respective owners.

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SOURCE Volkswagen Financial Services; Wells Fargo

FAQ

When will Wells Fargo begin providing financing for Volkswagen and Audi vehicles?

Wells Fargo is expected to begin providing financing for Volkswagen and Audi vehicles in April 2025, according to the agreement with Volkswagen Financial Services.

What brands are included in the financing agreement between VWFS and Wells Fargo (WFC)?

The financing agreement between Volkswagen Financial Services and Wells Fargo (WFC) includes the Volkswagen, Audi, and Ducati brands in the United States.

How many dealerships will be covered under the new financing agreement with Wells Fargo (WFC)?

The agreement with Wells Fargo (WFC) will cover more than 600 Volkswagen, 300 Audi, and 130 Ducati dealerships in the United States, totaling over 1,000 dealerships.

What will be Volkswagen Financial Services' role after the transition to Wells Fargo (WFC) financing?

After the transition, Volkswagen Financial Services will focus on consumer leasing, usage-based products, mobility solutions, and continue to lead customer experience and brand relationships in the U.S. market.