Can You Still Finance the Company Car?
In order to keep employees loyal, some managed service providers offer company cars to their field support staff. But continuing that company perk over the long haul could become more difficult during the credit crunch.
Fact is, lenders increasingly reject applications from people with good credit scores. Across the US, fewer than two-thirds — 63.7 percent — of car buyers who applied for loans are receiving approvals, accoring to a story in today’s Newsday, a major newspaper on Long Island. For “subprime” applicants, barely one in five of all car loan applications are getting approved.
The MSP Connection
I realize that only a small percentage of MSPs offer company cars to their employees. And I also realize most of those cars are leased rather than purchased with auto loans. One Long Island-based MSP, whom I met at the ConnectWise Partner Summit last week, says he offers company cars and hightened salaries as a way to avoid confusing sales commission programs.
However, it’s becoming clear that the Wall Street financial meltdown is starting to impact Main Street USA in multiple ways. If you need financing to expand or rotate your auto fleet next year, your business needs to establish and maintain strong credit.
According to the Newsday report, which was based on data from CNW Marketing Research, the drops in percentage loans approved from last year are sharpest in Nevada (down 29.2 percentage points), California (-28.9%), Arizona (-21.6%) and Florida (-28.6%).
(Side note: I read the Newsday story in good-old print. But Newsday’s site is far too confusing for me to find a link to the story.)