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Toyota Pays $21.9 Million to Settle Discrimination Charges

Maker's finance arm charged minorities more for auto loans.

by on Feb.11, 2016

Toyota Motor Credit, the automaker's captive finance arm, agreed to pay a $21.9 million fine over discriminatory lending practices.

Toyota Motor Credit agreed to pay a $21.9 million fine to settle complaints by federal agencies that it used discriminatory policies when setting interest rates for auto loans for minorities.

TMC, the automaker’s finance arm, also agreed to change its pricing and compensation system by reducing dealer discretion and accompanying financial incentives to mark up interest rates as part of the agreement it reached with the Consumer Financial Protection Bureau and U.S. Department of Justice. The CFPB, a new agency created by reforms of the financial system promoted by the Obama administration, said Toyota Motor Credit has agreed.

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The fine is restitution to thousands of African-American and Asian and Pacific Islander borrowers who paid higher interest rates than white borrowers for their auto loans, without regard to their creditworthiness, as a result of its past practices. (more…)

Daimler and Toyota Extend Credit to Penske

A positive sign for car buyers.

by on Sep.21, 2009

Penske

Penske Automotive Group is the second largest U.S. auto retailer.

In an SEC filing today, the Penske Automotive Group said that a $459.0 million Credit Agreement from Daimler Chrysler Financial Service USA LLC and Toyota Motor Credit Corporation has been extended.

The agreements provide for up to $250 million in revolving loans for working capital, acquisitions, capital expenditures and investments. For other general corporate purposes, a non-amortizing term loan originally funded for $219 million and for an additional $10 million of availability for letters of credit, has been extended through September 30, 2012.

Penske Automotive Group is the second largest publicly traded automotive retailer in the United States as measured by total revenue. It owns and operates 160 franchises in the United States. Penske  is also in  the process of purchasing the Saturn brand form General Motors Company. Penske purchases motor vehicles from Daimler AG and Toyota Motor Corporation. Their lending affiliates also provide Penske with “floor-plan” financing and consumer financing.

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Easy Terms!

What this means for car buyers is that Penske Group dealerships will be able to offer consumer financing for vehicle sales and leasing without depending on banks, which are still reluctant to extend credit as the Great Recession continues.