I study whether companies strategically utilize captive financing, a form of providing funding to consumers, to manage product demand. Using detailed data on auto loans, I show that captive lenders alter the financing terms and lending standards throughout the product life cycle. They reduce interest rates, allow longer maturity, charge lower down payments, and relax loan standards (1) when the underlying car models become outdated; (2) when competitors release new models; and (3) when they experience exogenous shocks such as recalls. While the lower interest rates offered by captive lenders reduce the likelihood of consumer default in the short term, the average default rate eventually increases in the long horizon because captive lenders’ willingness to dispense higher-risk loans allows more subprime borrowers to access credit. For consumers who cannot find a loan from non-captive lenders, borrowing from captive lenders helps them in purchasing a car, but they could potentially be approved for a loan they cannot afford. These findings collectively suggest that captive financing is a tool manufacturers use to boost car sales throughout the product life cycle, while this tool could induce overleveraging by consumers.