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In the early 1950s, Britain was the world’s largest exporter of cars, vans and trucks. Even as production soared in the United States, UK manufacturers maintained a privileged position in the automobile trade.
Today, we are mainly known for high-end models, from Bentley and Rolls-Royce to Aston Martin and McLaren.
But the wider industry still contributes billions of pounds to the economy and employs more than 750,000 people. Most work at around 4,600 car dealerships and sell new and used vehicles nationwide.
Buying a car should be a pleasant experience. However, all too often this is time-consuming and tedious: too much paperwork, too many sales pitches, too much nonsense.
Eliminate the sales pattern: Pinewood software aims to change the way cars are sold and maintained
Pinewood Technologies strives to make the process smoother and more enjoyable for sales staff and their customers.
Working across the automotive industry, Pinewood specializes in software to facilitate the sale, maintenance and repair of automobiles.
The shares cost £3.38 and should rise much higher as chief executive Bill Berman implements his strategy here and abroad.
For many years, Pinewood was part of Pendragon, the car dealership firm behind brands such as Evans Halshaw and Stratstone.
Widely regarded as a hidden gem, Pinewood developed cutting-edge technology, but growth was limited because Pendragon’s rivals were reluctant to buy software from a competitor.
However, in February this year, Pendragon’s retail division was acquired by one of the largest automobile dealership groups in the United States, Lithia.
The firm has more than 300 sites in the U.S. and Canada and annual sales of about 100,000 vehicles.
The deal left Pinewood as an independent entity, still providing technology to Pendragon but no longer tied to the threads of its former parent. Berman has signed many new contracts since then, but most have been relatively small.
Last week, however, the group announced a deal with Marshall Motor Group, one of the UK’s largest car retailers with some 143 dealerships, which sells cars, vans, trucks and motorcycles for brands ranging from Jaguar to Skoda. .
Pinewood will now work with over 1,600 showrooms not only in the UK but also in Eastern Europe, Asia and South Africa. But for Berman, this is just the beginning.
Born and raised in California, he spent 21 years at America’s largest auto dealership, AutoNation, rising through the ranks to become president of the company. In 2019, he joined Pendragon as a non-executive director, but was quickly promoted to chief executive after the incumbent resigned.
Interested in IT since his student days, Berman saw Pinewood’s potential from the beginning.
Covid delayed plans to make the business independent; now all systems are working.
A special meeting with big investors last week highlighted the magnitude of Berman’s ambition, across four key pillars.
Firstly, get more business into Britain, much like the Marshalls contract. Second, drive growth in Europe, Asia and southern Africa. Third, develop new products, such as AI chatbots and data analytics for enterprises. Fourth, and perhaps most importantly, move to the United States.
Setting up shop on the other side of the Atlantic can seem like a daunting task. But Berman has Lithia by his side. The US company has a 25 per cent stake in Pinewood and the duo intend to work together, developing, testing and deploying British technology across the US.
There are rivals, both here and there, but most offer products that are clunky, limited in scope, or both. Pinewood’s software is offered as a service and covers all aspects of car ownership, linking manufacturers, dealers and consumers.
Not only can purchases be completed more efficiently, but maintenance and repairs become significantly less complicated for customers and mechanics.
When servicing a car, Pinewood technology allows owners to track the process throughout the entire process.
If new parts are needed, workers can upload videos so customers can see what’s wrong and approve repairs online. And if households own more than one car, that is also made clear, avoiding repetitive calls from over-eager dealers.
It’s also important to note that the Pinewood kit works for all vehicles, from trucks to electric cars.
City brokers have high hopes for the business, forecasting a 61 per cent rise in profits to £12.6m in 2025 and £17m the following year.
Midas Verdict: The UK was once a big car manufacturing country. Now Berman wants to make Pinewood a global leader as well, as a premier software provider for dealerships around the world.
He has experience at the helm and is determined to succeed, and if he does, the stock should go far. At £3.38 they are a good long-term bet.
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