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Honda finance to pay $24M for discriminatory lending practices

Honda has found itself in hot water in the United States over allegations of discriminatory lending practices. However the Japanese automaker's American subsidiaries are taking actions to not only alter its practices, but compensate the victims of such past discrimination. According to the Consumer Financial Protection Bureau, some Honda dealers were found to have offered less preferential loans to customers of African-American, Hispanic, Asian, and Pacific Islander ethnicities than they have offered to white customers, irrespective of their individual financial situations. The American Honda Finance Corporation has allowed dealers to mark up individual loans by two percent or more, depending on the length of the loan's contract, thereby opening the door for dealers to set interest rates at their discretion. And that discretion, according to the CFPB and the Department of Justice, has been applied in a discriminatory fashion, in violation of the Equal Credit Opportunity Act. Honda, for its part, refutes the allegations and maintains that its practices have not been racially or ethnically discriminatory. The company is nevertheless taking measures to address the charges. For one thing, Honda's US financial arm is reducing the amount of wiggle-room it gives its dealers to only 1.25 percent above the buy rate for short-term loans (5 years or less), and one percent for longer-term loans. It has also set up a $24-million fund to compensate victims of the alleged discrimination, coordinating with the CFPB on the dispersal of said funds. The CFPB reports that "because of Honda's responsible conduct," it is not seeking penalties to be levied against the company for the alleged discrimination. STATEMENT BY AMERICAN HONDA FINANCE CORPORATION RE: Settlement with the Department of Justice and Consumer Financial Protection Bureau Jul 14, 2015 -- American Honda Finance Corporation (AHFC) has reached an agreement with the Consumer Financial Protection Bureau (CFPB) and the Department of Justice (DOJ) that shows our commitment to work together to be part of the solution and to establish the path forward that best supports our Honda and Acura customers and dealers with clear and convenient financing options. AHFC strongly opposes any form of discrimination, and we expect our dealers to uphold this principle as well. We firmly believe that our lending practices have been fair and transparent.

Weekly Recap: Hyundai spins off Genesis as new luxury division

Hyundai is creating a standalone luxury division that will use the Genesis name in an ambitious move that could bring the Korean automaker more profits, sales, and prestige. The Genesis division launches in December in Korea, followed by a rollout in other markets, including the United States in 2016. The brand will have six models by 2020. They will all start with a "G" for Genesis, then have a number, like 70, 80, or 90 to represent their segment, Hyundai said. The vehicles will also get more upscale design to differentiate them from other Hyundais. Luc Donckerwolke, a veteran Volkswagen Group designer who joined Hyundai earlier this year, will oversee a new Prestige Design unit at the company. The current winged Genesis emblem will be restyled and worn by all of the brand's luxury vehicles. Hyundai says its new division will focus on technology, customer service, and will have "refined performance character." The current Genesis sedan offers a 5.0-liter V8 that makes 420 horsepower. Naturally, Hyundai is optimistic for its new Genesis brand, but it will face immediate challenges as it enters a crowded and competitive market with a long list of entrenched competitors. Brands with storied histories like Cadillac and Lincoln have struggled recently, and even top-selling brands Mercedes-Benz, BMW, and Lexus aren't immune to potential troubles. Rumors have persisted that Hyundai harbored luxury ambitions since it first launched the Genesis sedan in 2008. OTHER NEWS & NOTES SEMA shows aftermarket's strength Further evidence of the auto industry's momentum was on display at the SEMA show this week as carmakers and tuners again turned out in full force. The Ford Cobra Jet Mustang, a Chevy Silverado customized by Kid Rock, and a Kia Forte Koup Mud Bogger were among the prominent displays. The show attracts more than 140,000 people per year, including 2,400 exhibitors, who come to buy and sell products. SEMA is a barometer for customization trends in the aftermarket, a key reason automakers attend. "They represent things we are thinking about and want to get some exposure," Mopar boss Pietro Gorlier said. Honda previews next-gen Ridgeline In other SEMA news, Honda previewed the next generation of its Ridgeline pickup at the show with a race-prepped vehicle that will compete in the Score Baja 1000 this year. The hood, side profile, roof, and front fascia offer hints of what the new truck will look like in production trim. Art St.

Honda spending $13.8 million on hydrogen infrastructure with FirstElement

Honda is partnering with FirstElement Fuel to increase the number of hydrogen refueling stations in California. The two have signed a letter of intent to provide $13.8 of financial assistance that, with some state money, could let FirstElement build "at least 12 stations." This is the second OEM that FirstElement is working with to install H2 stations in California. It signed a deal worth an unspecified amount with Toyota to help build 19 stations. State officials in California have said they are willing to spend $100 million to $200 million to build 100 hydrogen stations in the next few years. Honda says that FirstElement could build "at least 31" or them thanks to automaker and government investment. At some point after March 2016, when its new fuel cell car will go on sale in Japan, Honda will start selling the production version of the FCEV in the US. Honda hasn't disclosed a price, but the fuel cell stack has a power density of 3.1kW/L and a range of 300 miles, combined with a refueling time of three to five minutes. The vehicle is Honda's next step to its target of a 30-percent reduction (based on 2000 levels) in CO2 emissions by 2020 from its US vehicles. Earlier this year, FirstElement said that it expects hydrogen stations to become profitable in about five years. Honda Supporting Growth of California Hydrogen Network with Financial Support to FirstElement Fuel Nov 19, 2014 - TORRANCE, Calif. Honda contribution of $13.8 million will further expand and accelerate the network of public hydrogen refueling stations Funding could enable FirstElement to add at least 12 stations to its California hydrogen network Seeking to expand California's public hydrogen refueling station network as a means to support the wider introduction of fuel-cell vehicles, Honda will provide $13.8 million in financial assistance to FirstElement Fuel to build additional hydrogen refueling stations around the state. Additional state grants, combined with the Honda financing, could enable FirstElement to add at least 12 stations to its California hydrogen network. "FirstElement Fuel is providing a vital piece of what is needed for a successful launch of fuel-cell vehicles," said Steven Center, vice president of Honda's Environmental Business Development Office.