DETROIT (AP) -- Chrysler said Wednesday that it signed a deal with Santander Consumer USA to be the automaker's main lender.
Dallas-based Santander will make customer loans and finance leases on Chrysler, Jeep, Dodge, Ram and Fiat vehicles starting May 1.
That's the day after Chrysler's lending contract with Detroit-based Ally Financial Inc. expires.
Santander, which is owned by Banco Santander of Spain, also will finance inventory and construction for Chrysler dealers, the automaker said in a statement.
Under the 10-year deal signed Wednesday, Santander will set up a separate business unit called Chrysler Capital. "The goal is to leverage an improved information flow that shows us how, as a finance provider, we can work with Chrysler to improve our offers to dealers and customers to capture incremental sales," Santander Consumer USA CEO Thomas Dundon said in a statement.
Most of Chrysler's competitors, including General Motors, Ford, Honda and Toyota, have their own financial arms that offer low-cost leases and low or no-interest loans to help spur sales. Ally, which is 74 percent owned by the U.S. government, has been Chrysler's main lender since it exited bankruptcy protection in 2009. The government got the equity stake and $5.9 billion worth of preferred Ally stock in exchange for a $17.2 billion bailout of the company. Chrysler also was bailed out by the U.S. government.
Chrysler has a good relationship with Ally and was not unhappy with its services, said Chrysler spokesman Ralph Kisiel. Chrysler dealers will keep doing business with Ally after its contract expires April 30, Kisiel said.
The move to Santander is the start of long journey with the lender that is evolving, said Kisiel, who would not give further details. "Clearly we want to give our dealers best-in-class products and best-in-class services," he said.