Company: CPSS
Filing Date: 2025-03-12
Form Type: 10-K
Source: 0001683168-25-001548
Chunk: 38

Company: CONSUMER PORTFOLIO SERVICES, INC.
Filing Date: 2025-03-12
Form: 10-K
Item: Item 1
Chunk 38
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 Operations May Be Impaired.

The automobile financing business
is highly competitive. We compete with a number of national, regional and local finance companies. In addition, competitors or potential
competitors include other types of financial services companies, such as commercial banks, savings and loan associations, leasing companies,
credit unions providing retail loan financing and lease financing for new and used vehicles and captive finance companies affiliated with
major automobile manufacturers, such as Ford Motor Credit Company, LLC and General Motors Financial Company, Inc. Many of our competitors
and potential competitors possess substantially greater financial, sales, technical, personnel and other resources than we do, including
greater access to capital markets for unsecured commercial paper and investment grade rated debt instruments, and to other funding sources
which may be unavailable to us. Moreover, our future profitability will be directly related to the availability and cost of our capital
relative to that of our competitors. Many of these companies also have long-standing relationships with automobile dealers and may provide
other financing to dealers, including floor plan financing for the dealers’ purchases of automobiles from manufacturers, which we do not
offer. There can be no assurance that we will be able to continue to compete successfully and, as a result, we may not be able to purchase
automobile contracts from dealers at a price acceptable to us, which could result in reductions in our revenues or the cash flows available
to us.

If Our Dealers Do Not Submit a Sufficient Number of Suitable Automobile
Contracts to Us for Purchase, Our Results of Operations May Be Impaired.

We are dependent upon establishing
and maintaining relationships with a large number of unaffiliated automobile dealers to supply us with automobile contracts. During the
years ended December 31, 2024 and 2023, no single dealer accounted for as much as 2% of the automobile contracts we purchased. The agreements
we have with dealers to purchase automobile contracts do not require dealers to submit a minimum number of automobile contracts for purchase.
The failure of dealers to submit automobile contracts that meet our underwriting criteria could result in reductions in our revenues or
the cash flows available to us, and, therefore, could have an adverse effect on our results of operations.

If a Significant Number of Our Automobile Contracts Experience
Defaults, Our Results of Operations May Be Impaired.

We specialize in the purchase
and servicing of automobile contracts to finance automobile purchases by sub-prime customers, those who have limited credit history, low
income, or past credit problems. Such automobile contracts entail a higher risk of non-performance,