Automobile

Donald Foss, billionaire founder of Credit Acceptance Corp., dies at 78

Donald Foss, who founded one of the nation’s largest subprime auto lenders, died Sunday of complications of cancer, according to a news release.

Foss founded Credit Acceptance Corp. in 1972 having started a car dealership in Detroit five years earlier, according to a news release from the company announcing his death.

The business model spurred on by Foss — who was 78 years old, according to Forbes — was based around selling to customers who would not qualify for traditional financing.

“His business model was truly innovative and led to him eventually becoming one of the largest used-car dealers in the world,” states the release from CACC, which had a market capitalization of about $7.4 billion as of Monday evening.

Foss retired from CACC in 2017.

Forbes pegged Foss’ net worth at around $2 billion.

The company, however, has also been faced with numerous legal issues, largely a result of the business of subprime lending.

Credit Acceptance, based in suburban Detroit, has settled multiple lawsuits with myriad states to the tune of tens of millions of dollars in recent years, including allegations that it made deceptive loans, misled investors and engaged in unfair collection practices.

Foss and his family, and the Nelsons — father Linden and son Sanford — teamed up to form Detroit-based Firm Real Estate, the Detroit-based company that accumulated a large cache of Eastern Market area property starting in 2017.

Sanford Nelson said in a statement Monday evening that Foss “was larger than life” to him and his father.

“He not only saw the vision for Eastern Market, but he was a vital partner in the development that’s occurring today. His financing made so much of the revitalization possible,” the Nelson statement read in part.

“We were fortunate to spend some time with him in his final weeks. He insisted that we carry forward on the vision laid out, which we intend to do.”

The Nelson statement said they will work with Foss’ family — which has a 50 percent ownership stake in Firm — to implement that vision moving forward. Marvin Beatty, an executive with what is now Hollywood Casino at Greektown, is also an investor with Firm.

Foss also showed up as part of the GameStop stock phenomenon in early 2021, having acquired about 5.3 percent of the of the video game retailer in a period previous to retail investors boosting the company’s stock price.

The billionaire endowed multiple scholarships, which the release from CACC says awarded more than 630 scholarships to students pursuing careers in the automotive industry at Northwood University.

And in 2016, Foss established a private fund, Car Dealers Care National Foundation, which gives back to the community through his personal philanthropy and CarRite, a chain of dealerships he founded in 2011, according to the release.

“Don has left behind a lifetime of hard work, which turned Credit Acceptance into one of the largest auto finance companies in the country,” the CACC statement says. “He was truly an American Entrepreneurial Icon, and his story epitomizes the great American Dream. Don’s death is a great loss, and he will be missed by many.”

— Crain’s Detroit Business Senior Reporter Kirk Pinho contributed to this report.

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