GM sees boost from GMAC bailout

DETROIT (Reuters) - General Motors expects to see a boost to sales as low-cost loans made possible by the federal bailout of finance company GMAC reach showrooms, the automaker's sales chief said on Tuesday.

"The bottom line is much better access to funding," GM vice president for North American sales Mark LaNeve said on a conference call with reporters.

GMAC, which has traditionally provided the bulk of financing for GM car buyers and dealers, received a $6 billion (4.16 billion pound) infusion from the U.S. government late Monday night as part of the Troubled Asset Relief Program.

The finance company has also been cleared to operate as a bank holding company after a restructuring that will reduce GM's ownership stake to less than 10 percent from its current 49 percent.

Although those changes will make GM the first major automaker to operate without the support of a captive finance company, LaNeve said the more immediate impact would come as a better-capitalized GMAC relaxes credit for consumers.

GMAC said on Tuesday that it would begin offering financing to consumers with credit scores of 621 or higher, an easier standard than the 700-score limit it had imposed in October as credit tightened.

GM's LaNeve said the easier lending standard would allow GMAC to finance vehicles for about 75 percent to 80 percent of new car shoppers, up from just 40 percent under the tighter standard it had applied for the past two months.

LaNeve said GM was also considering a return to auto leasing, a form of financing credited with supporting sales across the industry from 2000 until about 2006.

"Hopefully we can return to leasing, but at a much lower risk," LaNeve said. "It's something that we are looking at."