General Motors Financial eContracting

Jessica Rudnicki [00:00:00] Hi, I'm Jessica Rudnicki with Reynolds and Reynolds, thanks for tuning in. Today, we welcome back Greg Uland, marketing director and former podcast host, to speak with Mike Urrutia, executive vice president at GM Financial, about the benefits of eContracting and why your dealership should go paperless in F&I. Let's get connected.

Greg Uland [00:00:22] Well, Mike, thank you so much for joining me today. I'm looking forward to the conversation.

Mike Urrutia [00:00:28] Greg, thanks for having me. It's an honor to be here with you.

Greg Uland [00:00:31] Yeah, absolutely. So, Mike, before we dive in and kind of get started, can you just share a little bit of your background? You've had a pretty decent amount of experience in the financial world, specifically in automotive finance. So can you share a little bit of your background?

Mike Urrutia [00:00:45] Yeah, sure. I actually started in the auto finance space in 1989 for a company that no longer exists. And in 1993, I joined AmeriCredit, which became GM Financial. So over my tenure with, with all these companies, I've done a little bit of everything in the auto finance space. I've led sales teams, credit teams, I ran our funding group for a while, managed a strategic alliances, so I've really got a really broad background of all things auto finance. In my current role today, I spent a lot of time dealing with the support functions for our credit and sales teams. So anything that's business system related business analytics and reporting or training for both internal and external groups, as well as I run our project management office for dealer services.

Greg Uland [00:01:39] That's great, that's great. So, I mean, I'm not a math whiz, but that's a lot of experience going back a little ways. Obviously, you've seen a lot change over the years and certainly including as we move forward, econtracting, which is what I'm hoping to talk with you and dig into a little bit today about. And really just the impact that it has on all the parties involved. So everybody from the dealer to the consumer to the lender. So maybe, could we start our conversation-- could you dive in a little bit and talk about the contrast between what it's like for a dealership to use paper contracting methods versus eContracting?

Mike Urrutia [00:02:19] Yeah, of course. And thanks for a great question. You know, it's interesting, as I go back over my career, I think one of the key catalysts that is driving more towards a digital funding solution is is really the pandemic. I mean, so much has changed in the last couple of years as we've gone through this. And and one of those key things is the ability for dealers and consumers to do their business in a more remote setting. And eContracting, in a lot of ways, empowers everybody to do that process. But when you think about a dealership, you know, paper is clunky. You know, you think about trying to keep all your forms updated, trying to keep things organized in a way that all the documentation is being processed the same way for every customer. It just becomes very clunky. And if you're the consumer, you get writer's cramp going into signing for a car loan. It's almost as bad as a mortgage at this point. And I think what's what's happening is, is consumers are really beginning to demand a different experience as well as dealers. And so what I think econtracting is really doing for the industry is, is it's enabling us to meet the customer where they want to be met throughout the whole buying transaction. So I think there's there's tremendous benefits for all parties. And I think we're finally to a point where the customers, both dealer customers for GM Financial, as well as consumer customers, are demanding a change.

Greg Uland [00:04:03] Yeah, yeah, I definitely agree, I am wondering if you can maybe dig a little deeper-- pop the hood a little, Mike, on that dealership world and some of the tangible kind of business impacts that it has. I think in general, people would say, yeah, let's go digital. That makes sense. But is it is it worth it? Right? Is it worth the time investment? Is it worth the money investment? What are some of those tangible impacts, business impacts that dealers that move to an eContracting model typically, typically experience.

Mike Urrutia [00:04:32] Yeah, it's really interesting. When you think about the dealer world, their number one thing is about turning cash. They want to invest in cars, bring them into their lots and get them off lots and get paid. So one of the big benefits for the dealer is, is speed of funding. When you're not having to package a contract and send it into a lender via FedEx, you're going to get rid of the FedEx cost. You're going to get your money faster because people are going to be able to literally fund the same day that they receive their contract package. We've had examples of dealers who have really adopted and fine-tuned their processes for econtracting, where literally they're funded before the customer drives off the lot. And that's huge from a CIT perspective for a dealer, not to mention customer satisfaction. I mean, you're in and you're spending-- you're making the second largest purchase you're going to make. And to sit down with a pencil and a pen and a contract and have to sign that documentation, in some ways it cheapens the process, but eContracting gives that consumer really the ability to experience what our vehicles today are experiencing, which is a very high tech process and experience that moves faster for everybody.

Greg Uland [00:06:07] Yeah, for sure, and to build off the consumer piece of it, you know, rather than walking out of the dealership with a giant folder full of, you know-- we actually looked at the average deal and when you stack each piece of paper end-to-end, it's thirty nine feet. So rather than walking out with a scroll of paper for a deal, it can be in an email or it can be on a USB drive or something like that, too.

Mike Urrutia [00:06:27] Yeah, that's a great point. You know, it's-- you think about the marketing opportunities as well where when you hand your customer their keys, you give them a key ring with a fob on it that's got all their paperwork. I mean, what a great marketing piece for a dealer.

Greg Uland [00:06:42] Yep, absolutely agree. I've seen, yeah, I've seen people put them on business cards that have kind of a USB pop out. It's pretty interesting, pretty interesting when you have the opportunity. So kind to flipping the seat more into kind of in your wheelhouse, it seems, and I mean, I think, but hoping you can elaborate on the benefits for the lender too. Obviously from GM Financial's perspective. But really any bank that's that's financing a consumer loan. Where are the benefits for the lender as well?

Mike Urrutia [00:07:10] Well, I think the biggest thing for us is it's speed. Number one. And number two, it drives cost out of the equation, you know. As econtracting, and I'll use the word, digital contracting continues to evolve, you know, direct integrations with the dealers' DMS to load data directly from the dealers DMS into our funding system. It eliminates errors. It eliminates time for data entry, all of those pieces. It allows us to move faster, drives cost out of our equation. So those are probably the biggest benefit for the lenders. And they're important because everybody's concerned about [inaudible] today.

Greg Uland [00:07:55] Yeah, yeah, for sure. So thinking about that, then, how does that ultimately impact the relationship between the dealer and the lender? And obviously the dealer has different relationships with each of their lenders, but if they're doing their floor plan through whoever they're financing this deal with, you know, is there any benefit there? Is there any impact, I guess, to that broader business relationship?

Mike Urrutia [00:08:20] Yeah, I think there definitely is. You know, when you think about how a dealer operates and again, we talked about that investment piece that they're making in vehicles and their job is to turn their cash as fast as possible. Well, if I'm the floorplan provider and we're very lucky to be able to do that for many GM dealers, and that customer econtracts, we'll literally-- we can pay off the floor plan at the same time we're paying the dealer their profit for and reimbursement for their products. So all of that becomes a very seamless transaction that drives customer satisfaction for the dealer. You know, the dealers that we see that today are highly integrated in the econtracting processes, they're all about that customer, and driving satisfaction for the customer. So the more that we can do to enable technology to deal with things like remote signing functionality, remote delivery, where it's where it's possible, and really meeting the customer where they want to be met. eContracting helps empower that.

Greg Uland [00:09:35] Yeah, yeah, for sure, and thinking of that customer, too, even in instances where you have, you know, co-buyers and you need to do things in different different places and things like that, it certainly factors in, too.

Mike Urrutia [00:09:48] Absolutely.

Greg Uland [00:09:49] Well, Mike, I definitely appreciate you just unpacking things a little bit. It's been a pretty quick conversation. But what else should we talk about while we have the audience and while we have a little bit of time. What haven't we talked about maybe that we should, or you want to?

Mike Urrutia [00:10:04] Well, I think one of the other things that you guys have the ability to help drive is how menu selling works. And the tools that you guys are providing to dealers today to make this truly a digital experience where you're integrating video, you're doing some of those things that the demystify the process of buying for a customer, that's just hugely important. And so as we think about that customer journey, regardless of whether they're doing it on their iPad from their couch or they're in the dealership, the more we can do to give that transparency, it keeps the regulators happy and keeps the consumers happy. And really, that's what we need to be striving for. So I really appreciate the time to talk to your team today and continue to unpack eContracting.

Greg Uland [00:10:59] Yeah, for sure. Definitely appreciate it. And if Mike, if you don't mind just one kind of follow up, because you mentioned menu selling and it kind of sparked the thought that, you know, it's not necessarily-- when you think about econtracting, that is one piece of the process, but it's still a big process. Right. And you need to have everything kind of all in the same flow, the same workflow for it to be successful. If you're if you're trying to sell products, all those products also need to be wrapped up into a digital package. And I'm sure you guys see that when you're trying to work with with dealers to put all this stuff together.

Mike Urrutia [00:11:32] That's-- you're exactly right. And again, it's about that experience, it's about what the customer expects and if everything is packaged together and it's a very seamless flow, it goes faster. We all know that the number one complaint is going into the finance office for a customer. They view that as a waste of two hours of their lives. Well, if we can get that down to 10, 15, 20 minutes, fully educated, fully disclosed, with complete transparency, it does nothing but help sell cars.

Greg Uland [00:12:06] Yeah, absolutely, or at least make it feel like 10, 15, 20 minutes, right, as long as they feel engaged too, that's part of the struggle is when they don't feel a part of that process. So engaged time is definitely different than watch time.

Mike Urrutia [00:12:18] Absolutely.

Greg Uland [00:12:20] All right, well, Mike, I really do appreciate you taking the time. It's been been fun to get to chat. So thanks so much.

Mike Urrutia [00:12:29] Greg, thanks for having me.

Greg Uland [00:12:30] Yeah, definitely. All right. Well, have a great day. And hopefully we're talk soon.

Mike Urrutia [00:12:34] Sounds good. Thank you.

Jessica Rudnicki [00:12:40] If you didn't have a reason to eContract before today, you do now. We want to say a big thank you to Mike at GM Financial for lending his advice on how to simplify and streamline the contracting process. Before we hop off, don't forget, you can watch or listen to episodes of Connected on YouTube, Apple or Spotify podcasts. Make sure you subscribe to get notified every other Wednesday when new episodes are released. Thanks for joining us. We'll see you in two weeks!