SAN DIEGO — Wells Fargo Commercial Distribution Finance‘s pre-owned inventory finance business has grown 20% year over year, Commercial Leader of Motorsports Jeremy Jansen told attendees at PowerSports Finance Summit 2019.
“From our perspective on the wholesale side, the growth starts with the pre-owned business,” Jansen said. “That piece of our business is up 20% this year, and it’s been up 15% to 20% the last three or four years, year over year, as the market has been flat, so pre-owned certainly is a growth area in powersports.”
Wells Fargo CDF is a wholesale financier for dealers that also provides lines of credit for pre-owned inventory. The lender works directly with OEMs such as Polaris and KTM to provide financing to their dealer networks.
Despite an increased interest, “there are not enough dealers that actively participate in pre-owned, whether it’s buying at [National Powersport Auctions] or just taking in trades,” Jansen said.
Wells Fargo CDF has an initiative to train dealers on how to capitalize on having a pre-owned business, which can drive new-vehicle sales if executed well.
“We have a pretty large field sales force, so we cover 700 dealers man-on-man across the country,” Jansen explained. “We’re out actively seeing those dealers two or three times a year, reviewing their portfolio, renewing their business with us and certainly trying to educate them on the benefits of pre-owned.”
The floorplan lender works with OEM partners to “actively promote” pre-owned vehicles to dealers using their more extensive resources and sales teams, Jansen added.