It is not particularly newsworthy - when a company enters the car leasing field. Because of the boom­ing nature of the business, this is happening with greater frequency than anticipated.

What is newsworthy, however, is when a company enters the leasing field for the first time and does so with strong financial backing and an Electronic Data Processing sys­tem that is among the finest offered in the entire industry.

This is the case of B-W Accept­ance Corporation, a Chicago based company. B-W Acceptance Corpor­ation has been in the sales finance business since 1953. The corporation is, of course, a subsidiary of the Borg-Warner Corporation, which, among its many diversified services, is one of the nation's outstanding suppliers to the automotive industry.

Hoffarth Takes Over

In January 1967, B-WAC officials began investigating the car leasing field to determine if it would be profitable to expand their opera­tions. In June 1967, Craig Hoffarth, manager of the Santa Barbara, California, branch office, was-brought to Chicago as Leasing Manager. It was Hoffarth's job to set up a leasing program. Working closely with carefully selected Chi­cago fleets and leasing experts a program was established.

Today, B-WAC has leases signed with divisions that have 1,800 ve­hicles and 500 of these are current­ly on the road with B-WAC. The leases are all within the Borg-War­ner family.

"There are approximately 2,500 vehicles within Borg-Warner so we felt we would center our initial op­eration on this basic source of sup­ply. Each of the divisions functions as a separate entity and in the past they have dealt with many of the leading national leasing companies or had company owned fleets," Hoffarth said.

While no leases have been signed outside the Borg-Warner family, "B-WAC has several very interest­ing situations pending" and by the end of the year, "we hope to be leasing with outside companies. We are a rather conservative or­ganization and until we have a pro­gram that is perfected, we would not attempt to sign outside com­panies."

"When it comes to rates, we are in the ball park with any company, regardless of size," Hoffarth said. "We have made some excellent connections in the area of used car disposal and have found by using our sources we were able to obtain satisfactory prices," he said.

"We have found that the open end, or finance lease is the most equitable arrangement. We will have other types of leases available, but we still maintain that the open end lease is the best for all parties concerned."

Dealer Relationships

What about dealer relationships throughout the country? "Through the help of the manufacturers' zone offices and our Chicago dealers, we have established relationships with dealers throughout the country." "The normal fleet cars will be pur­chased locally while the high-price models will be drop shipped under most circumstances," Hoffarth said.

Hoffarth used the B-WAC fleet of 185 vehicles as a classroom for establishing a leasing program.

"Before attempting to tackle a leasing operation on a national basis, I became familiar with our experiences and problems. Then with the help and advice of select­ed fleet dealers, experienced leas­ing people and the manufacturer's representatives, we tried to elimin­ate the bad habits of others who have entered the leasing field. The education received by these people has been invaluable in setting up a program," Hoffarth said.

Hoffarth is selling three major points in the B-WAC program. Ac­cording to the B-WAC philosophy, however, stressing may be a better word than selling.

The three points are financial stability, a completely computer­ized program, discounts on gas and oil purchases (the normal tire credit cards are also offered).

"One of the biggest advantages we have over other companies is our financial stability," Hoffarth said.

Whether it's a billing run, main­tenance record, rebate ledger or fi­nancial analysis, B-WAC puts it through the computers.

Want to know the book value of a particular vehicle on any day of the month during the lease? B-WAC's computer will figure it in a few seconds.

Lubrication Needs

Interested in knowing how many gallons of gasoline, quarts of oil, the totals for a month and accumulated year to date information? Give the B-WAG computer a few seconds. What about vehicle serial number, state location, capitaliza­tion costs, monthly service charge, insurance costs, tire purchases, washing and parking expenses, toll charges', license and taxes, accident repairs and maintenance costs per mile? Just ask the B-WAC compu­ter.

The Borg-Warner divisions leas­ing with B-WAG are responsible for submitting the necessary infor­mation for this type of a report and as Hoffarth points out, "Our com­puters are like any other computers, and are only as good as the infor­mation they receive."

"We are blessed in that we have our own Data Processing Center and the experienced people so vital to its successful operation. In this way, we can afford to experiment with a particular program that may be of benefit to a client. If it doesn't work, we just throw it away and start with a new idea. We have a tremendous advantage over the leasing company that has to go to an outside source for its computer work," Hoffarth emphasized.

Third "Selling" Point

The third "selling" point in the B-WAC leasing program is a unique gasoline credit card pro­gram.

Again using the Chicago office as a classroom, Hoffarth studied the gasoline and oil expenses of the 185 B-WAC ears. He found that those vehicles were using an average of 30,000 gallons of gasoline per month.

After much investigation, Hoffarth initiated a gasoline credit card system for B-WAC customers. Un­der this program B-WAC receives a 3% discount, from a major oil company, plus further discounts on the local retail level. A credit card is issued to a driver with the ve­hicle number embossed on the card. The retail gasoline operator sends the billing cards to the oil company which puts the cards through a computer and comes out with a billing run that is broken down by vehicle, number of gallons of gas, quarts of oil, etc. and the cost. The billing is then presented to B-WAC, who in turn passes it on to the les­see for payment.

$20,000 Savings

"Our projected annual savings on fuel for 185 vehicles is $20,-000.00," Hoffarth said.

If a B-WAC client decides on the fuel program, B-WAC will handle all billing and passes half of the 3 per cent discount onto the client.

"In analyzing our operations, we feel that there are many companies in the leasing industry that are do­ing a good job, Hoffarth said, but we feel that it is hard to beat the flexibility and overall service pro­gram that B-WAC has to offer."