March 5, 2026 | Pinewood.AI CEO on why Apax deal fell apart; buyers stretch loans to 7 years

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Welcome to daily drive for Thursday, March 5th,

2026. I'm Jake Near and Detroit in for Kellen Walker.

Today on the show, the Iran conflict forces automakers to delay Middle East shipments,

wealthy shoppers keep auto sales afloat while lower income customers struggle,

and more buyers stretch auto loans to seven years or longer to afford record prices.

Plus, Pinewood.ai CEO Bill Berman joins the show and explains why private equity firm APEX partners

backed out of acquiring his company and how AI disruption fears in the software market are spooking investors.

APEX did great due diligence got all the way down to the 11th hour,

and when they went for their final vote on an investment committee,

a lot of the noise and disruption that had happened from what came across with Anthropic had in pause.

Let's run through all the news you need to know to keep up in the auto industry.

The Iran conflict is rippling through global auto supply chains.

India-based automakers are now delaying shipments to the Middle East and North Africa.

The Strait of Hormuz has become effectively impassable, forcing costly rerouting around South Africa.

Companies including Tata Motors, Suzuki, Hyundai Motor India, and Volkswagen's local unit

are holding off to avoid emergency surcharges of up to $2,000 per container and war risk insurance spikes.

The region represents 8-40% of export volumes for key manufacturers,

freight costs, and crude linked inputs like tires could squeeze margins industry-wide.

Wealthy shoppers are keeping auto sales afloat while lower-income customers struggle.

Two economists say the economy is splitting in two. Cox Automotive's Jeremy Rob says higher-income

shoppers are doing fine, but it's brutal for lower-income consumers facing slower wage growth

and higher costs. Vehicle ownership expenses jumped 48% from 2019 to 2025, far outpacing inflation

when you factor in insurance, maintenance, and fuel. NADA's Patrick Manzi says that's

manageable for dealers in 2020 half of new vehicle buyers made under $100,000 by 2025 just 37% did.

Meanwhile, those making over $250,000 nearly doubled to 21% of buyers.

And with more people struggling to afford new cars, more buyers are stretching their loans to

seven years or longer just to make it work. According to Edmonds, just under 21% of new vehicle

buyers financed for 84 months or more in the fourth quarter. That's up nearly 3% from the year

before. It's the third straight year that number has climbed, according to Kelly Bluebook,

average new vehicle prices hit a record more than $50,300 in December. The problem, buyers end up

paying more interest over time and risk being underwater on their loans. Joining me now to

talk more about this issue is Riley Hodder, who's been covering the story for us at Automotive

News. Riley, welcome to Daily Drive. It's great to have you here. Hi Jake, I'm happy to be here.

I think this is something that is touching on a lot of issues that retailers are thinking about

these days at a really top of mind. You mentioned that analysts at Edmonds and experience are concerned

about spikes in negative equity down the road, something that we've been talking a lot about at

Automotive News over the last couple of months. Are lenders showing any signs that they're tightening

standards on these ultra long loans? Are they still kind of treating them as businesses usual?

Yeah, it's actually funny you mentioned analysts because I got the most kind of clarity on that

that topic when I talk to a dealer in Kokomo, Indiana because the dealers they interact with

so many lenders so they get to kind of see a wide range of experiences. Essentially what he kind

of talked to me about was that they kind of have essentially two types. There's a bit of a range,

but two general types of lenders in this topic with these long-term loans. You kind of have lenders

that are doing it right. One example he gave was Capital One is doing it really well. If a customer

buyer is really interested in a longer loan term, they will really weigh that with their background

essentially. Take a look at their credit score, their history and decide whether or not to give them

that loan term based off of that, which is going to really hopefully be able to point to whether

or not they're going to be able to pay off those loans and be able to avoid that negative equity

later on down the line. Obviously, not always the case because sometimes crazy events happen,

it hopefully points them in the right direction. Then there's other lenders that kind of really

just as long as the loan term fits within our guidelines, they're willing to give it to anybody.

He said that's really who are just going to be able to, who is going to drive in any possible

increase and negative equity that comes as result of these loan terms is going to be those lenders

that are not really thinking about it at all. Those lenders definitely exist and they're definitely

out there and they're willing to be bold without a ton of credit check and stuff like that for

these longer loan terms and obviously generally at higher interest rates as well. He said that

there's going to be any result that any people that are driving that, it's going to be those lenders

and that they are still out there and they're doing it. There are some that are kind of stingy

and they're kind of upping their standards when it comes to these longer loan terms, especially

beyond 84 months, but there are some places that they are really just saying,

if you are interested in this kind of loan, we're happy to give it to you.

Interesting. Now, you spoke with a dealer in Kokomo who said his story is trying to have those

hard conversations with customers about loan length and what it could mean for them,

but how come and are those approaches across the industry in your estimation? Our most dealers

still prioritizing the sale over steering customers towards shorter, more financially stable loans?

Yeah, so I mean, he did tell me at the end of the day, you got to get the deal. You know,

you're a dealer, you know, they're to sell cars, you got to think about yourself, you got to get

the deal and kind of what he talked about was a little bit of like a balance that you have to

establish. You know, if you sell somebody a longer auto loan term on their car and then they end

having a really negative experience with that because of a lot of the consequences,

you know, having to pay really costly services and repairs later while you're still paying off

your loan, having higher interest rates than normal, having to pay off more in interest than

really you would have had to if you had just gotten a shorter loan with a higher monthly payment.

And none of that was brought up in your original conversation with your salesperson or your

finance person at through dealership. They're probably not going to come back. They're probably

going to be pretty upset. But also, you know, you want to be able to make sure that the customer is

making the right decision for them and you're not kind of telling them what to do because they're

also probably not going to come back if that's something that you do. So he's like it's striking

a balance. You don't want to have your salespeople and your finance people be essentially avoiding

talking about these things or the per se of getting the deal. But you also don't want that to push

anything on them. So you just want to be like, hey, these are some things that you need to be aware of.

Sadly, this kind of approach is really not that common because he also pointed out, you know,

that a lot of people, they a lot of dealerships, they don't really have the resources to be

thinking that heavily about the consequences, especially if they're, you know, thinking month to

month and they're really, really trying to be able to hit their monthly goals. And especially

dealerships that are struggling financially right now, dealerships struggling to move really

expensive cars to people who maybe aren't able to afford them. And those people are often,

you know, really, really overworked and they don't have a ton of time to sit there and be like,

hey, this might not be the best idea for you, especially and also like salespeople who, you know,

need to make money themselves. They need to, you know, get commissioned for their families and

stuff like that. So it's not the most common standard, which is really unfortunate, but it's not

necessarily dealers are out here like trying to like, you know, manipulate people or when they

take advantage of them, it's sometimes like they just don't have the resources to be able to

have these like really long-term kind of conversations with these people and sometimes they really

need to prioritize and prioritize the deal. To quote the late great prince, the sign of the times,

Riley Hodder. Thank you so much for joining us on Daily Drive and we will keep following this,

really appreciate your reporting. Thanks for coming up. Pinewood.ai CEO Bill Berman joins us to

explain why Apex partners walked away from acquiring his company and what AI disruption fears

mean for automotive software. That's next on Daily Drive.

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Welcome back to Daily Drive. I'm Jake Near. Pinewood.ai had a breakout moment at NADA this year

winning two awards and signing deals on the show floor. But behind the scenes, private equity firm,

Apex Partners, was in the final stages of acquiring the company and taking it private. Then,

at the 11th hour, they walked away. Our own Mark Holmer spoke with Pinewood.ai CEO Bill Berman

about what happened and why fears about AI disruption in the software market spooked investors.

Even though Berman says his company has a moat that protects it from the threat.

Bill, thanks for joining me once again. I hope things are going well so far.

Everything's going great, Mark. Nice to see you again as well. Sure. We last talked at NADA.

Yeah. And so I'm wondering how it went for you. I blew by all of our expectations. It went

absolutely amazing. I think that's the 20th NAD I've been to and maybe a little bit more than that.

Mark, I don't even know this, but we actually won two awards. I'd even know there was awards to be one.

I didn't know. But we won, yeah, we won Best New Intrant. And I'm Kim Costello, our CMO and our

marketing team and all of our associates did a great job. And we absolutely had the best booth

as well. So we kind of a double award winner, which was great. And then in addition to that,

we had a huge influx of customers way exceeding our expectations out there. And everything was

incredibly well received. All kinds of great opportunities. Even a couple of small deals that we're

able to sign on the spot for our various products. And I think we've got a great pathway as we made

our first official launch into North America. So really exciting. And overall, the team did

incredibly well. Congratulations. I'm wondering if how soon we can see or hear some of those

announcements that are to come? Well, good or bad. We're publicly traded. So we can't say

don't want until we say to to the public. But as those things mature and get out there,

based on size and scale, we will be obliged to announce that to the market. But right now, we're

keeping it close to the vast. But like I said, it really exceeded our expectation. I'm glad,

I'm glad. Right around the time of an ADA apex of private equity firm out of the UK was contemplating

an acquisition to take your company private. And that came out right around an ADA. So there was

a lot going on. It's like everything at once. But since then, they have declined to go further.

So I'm wondering from your perspective, what happened in what's your reaction to that? Yeah.

So listen, I think we've built a great company and lots of people have looked at us. I think

Apex is a unique private equity as it relates out there. They've done lots of investments in automotive

technology in North America, as well as in Europe. They kind of dual offices both in New York and

London. And they engaged with us to the end of last year on a potential take private. And they were

even offering up the ability for our existing shareholders, i.e. Lithia, for example, to be able to

roll over into a new privately held company during that transaction or during those kind of

negotiations and going into the due diligence, there was a leak. And we had to make a market

notification. And that was on the 29th of January. And then shortly after that, right around an ADA,

you had the entropic news that hit with Claude and kind of the disruption and some of those legal

platforms in the such out there. And there's been a huge adjustment within the overall software

market as a whole. And Apex did great due diligence, got all the way down to the 11th hour.

And when they went for their final vote on an investment committee, a lot of the noise and

disruption that had happened from what came across with entropic hadn't paused. So they had several

different deals working. They ended up pausing on all of those within a UK context and being publicly

traded. We can't engage with them for another six months. But it was 100% for because of what happened

with the entropic and kind of some of the disruption in the software bases. That said, listen,

we're happy being publicly traded. There was a great pathway with Lithian, other shareholders and

Apex to go private. We would have been equally successful that way. But we don't think this limited

as us or really changes anything. I just think it's a timing issue. And once again, even the conversation

publicly all started because of a leak and those things happen at times. But at the end of the

day, it didn't take anything away from what happened at NADA, what's happened since then,

just the overall kind of work ethic and driving determination that the team have has just been

accelerated. So I feel we're in a great space right now. I'm glad that things are moving forward.

But I'm curious too, if you could flesh out a little more, what happened with entropic

specifically that put the kibosh on this and other deals like it?

One of the renditions of Cloud, that's their engine, kind of like a chat GPT that came out there.

They had a destructive force when it came into the legal platforms that exist out there like Harvey.

And it showed that you could sit here and use a engine like Cloud to be able to develop certain

amounts of software by different groups, so to speak, to be able to do different functionalities.

And there has been a real reaction in the public markets on that on various software

companies that have got hit quite drastically because there's a fear in the marketplace that

different software companies could be disrupted by AI by people or small groups being able to build

homegrown solutions to facilitate different aspects within their businesses.

The unique thing about Pinewood AI is multifaceted, but we have an enterprise level accounting

platform. We're in 36 countries, so we're able to provide an enterprise level accounting

platform, a system or record across those 36 countries. That is not something that's

disposable with AI. We have integrations with the top 50 OEMs in those 36 countries.

Worldwide, those are very bespoke is specific to each one of those OEMs.

If those aren't open source lines of code or communication that can be written.

So that's another thing that wouldn't be easy or actually would be virtually impossible

for AI to disrupt. And I think what's happened is a company that got pinewood.ai.

We've got lumped in with anything that resembles software. And there's a thing to be said that

we could be disrupted. I 100% don't believe that to be the case in a way, shape or form.

I could see why if you're in different facets and software where I might be a little bit more worried,

but with our products, what we offer and the services and the tech that we provide to our

customers, I feel we've got a great mode around us to be able to grow on a go-forward basis.

And by disrupted, you mean what? Well, I mean, if somebody couldn't see here and write an

enterprise level accounting platform for automotive using chat GPT or clot. So you couldn't

disobey a DMS system like ours by using an outside AI engine to go out there and do that.

So what you're saying then is that there's a perception that AI has evolved through

platforms like cloud. Could basically do the work that companies like yours and Techion and CDK

and the others can do. And so investors are a little wary of companies like yours. Is that one?

It's overall software, but yeah, specifically when it comes to automotive, we're the only

publicly traded of the groups that you just described. We're the only publicly traded one.

It's the same thing, whether it's in Europe and the other players here, but none of those,

and I would say a company like ours with our tech stack, our data stack, the functionalities

and capabilities we have are even a step above those when it comes to being having a mode around us

to prevent disruption from AI. And Mark, you and I've talked about this before. The dot AI,

we actually have high amounts of AI functionality. You already built into our system.

We have free standing AI products that we sell on top of that. So I think we're in a unique

position where not only do we have the moat built around us with our enterprise level

accounting platform, the integrations with the top 50 ohms worldwide. In addition to the AI

products, I think we've got a well-capsulated thing here. But within a normal investment and you look

at the way investors do it, especially things that are computer driven are different modules.

A software company is a software company to a lot of those type of investment groups,

and they don't really differentiate a company like Pinewood AI that has a moat around them

versus somebody that might be more easily disrupted. I understand. You didn't mention that

as a public company, the UK that you won't be talking to impacts again for at least six months.

Yeah. So what happens after that? So if somebody else made a bid for the company,

we could, uh, apex and come in. It's a UK listing rule. And what it basically says is that

if someone's made an offer and pull that offer off the table, they can't come back, you know,

a month later and try to put a different price out or to renegotiate. It's called be put pencils

down and it gives times for everything to settle. In six months, you know, if apex wanted to

restart a conversation and maybe normalities hit back into the software market, you know,

we'd be open to any conversation with any good partner that could help us grow the business

to the level we are now maybe even at a faster pace. But they can't engage with us

unsolicited for six months. I got you. Let's circle back to the US. You are, you have a very

big client to start with with you. And we talked a little bit about some news that you expect

by March in terms of rollout. Tommy, what's going on? Yeah. So in March, and actually we've already

started this or doing our UAT testing and we've already got different modules that we're testing

in the store. So we have our platform up and running in North America. So we're already running

in a Porsche facility in Canada. We're operating right now in a facility in Lithia right now

where we have different functionalities and different aspects of our platform being operated

into there. After we've done that, we'll go to a second brand, do our UAT testing and then we'll

start rolling out in the second half of this year through 27 and in the first part of 28 for

all 320 Lithia stores. So you're on at this point, at least you're on schedule. Well, it's never

as fast as I wanted to go, Mark, but yes, we're from what we've put out into the marketplace.

We're going another glide path that we'd set up. Excellent. Bill, thank you for your time.

We appreciate the conversation. Till next time. Thanks, Mark. Talk to you soon.

That's daily drive for today. I'm Jake Nier in for Kellen Walker. Thanks to our own John Hutter

and Riley Hodder for their reporting for today's podcast. You can get the latest news on AI and

automotive software, auto loan trends and everything happening in the auto industry at autonews.com.

Come back tomorrow for a conversation with Cox Automotive Executive Analyst Aaron Keating

about the company's latest dealer sentiment survey, which shows that retailers remain tepid at the

beginning of 2026. Most of them were feeling, of course, coming down off of last year, fourth quarter

was a little bit difficult. January is always sort of a slower time whether it was a major

impactor. But February, you know, to be honest, we've just started to see some of the results and

they sort of match what their optimism was that February sales started to pick up. And so they

do see that that spring bounce as usual is something to be optimistic about. We'd love to hear

from you. Let us know what you think of the show and the topics we covered today. Send us an email

at dailydriveatautonews.com or leave us a voicemail at 313-444-2774. And if you enjoy the podcast,

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