July 30, 2008 / 4:40 AM / 9 years ago

GMAC to stop subsidized auto leasing in Canada

BANGALORE (Reuters) - Finance company GMAC LLC said it had informed dealers it would suspend subsidized leasing of automobiles in Canada from August 1.

GMAC, which provides automotive, real estate, insurance and other financial services, has suffered mortgage-related losses. The company faces “funding challenges” for lease assets in Canada, spokeswoman Gina Proia said, according to a story published in the Wall Street Journal.

“GMAC did inform dealers that as of August 1 it would suspend incentivized leasing in Canada,” Proia said in an e-mail to Reuters, confirming the report.

Proia said GMAC has not announced a similar move for the U.S. as of Monday, according to the Journal.

GMAC is 51 percent owned by private equity firm Cerberus Capital Management LP, which bought the interest from General Motors Corp in 2006. The automaker owns the rest.

Reporting by Varsha Tickoo in Bangalore; editing by Sue Thomas

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