The UK-wide garage chain Nationwide Accident Repair Services has gone into administration after trading was badly hit by the coronavirus pandemic.
Some of Nationwide’s subsidiaries have also been placed in administration.
Administrators Pricewaterhouse Coopers (PwC) managed to sell almost all Nationwide’s business and assets to RunMyCar Ltd – a subsidiary of Redde Northgate – immediately following their appointment on Friday (Sep 4), after an agreement was reached ahead of the administration process starting.
The move saved 2,350 posts across 80 sites including repair garages, but 540 jobs have been lost and 30 sites closed at the Witney-based company, which was a major player in the accident repair sector.
Rob Lewis, joint administrator at PwC, said: ‘As with many other businesses, the group had to weather major financial fallout due to the economic impact of Covid-19, which meant that trading volumes were significantly reduced.
‘Against that backdrop, the sale reflects a significant positive outcome for the business, and we are especially pleased to have safeguarded 2,350 roles including apprentices, mechanics and technicians.
‘Sadly we have had to make 540 staff redundant. We are making every effort to support those workers. This includes providing guidance for employees regarding JobCentre Plus and Redundancy Payments Service processes.’
Fellow PwC administrator Rachael Wilkinson, added: ‘Companies across the automotive sector are still recovering from an extended period where activity ground to a halt, significantly depleting cash reserves.
‘Some are only reaching a fraction of pre Covid-19 volumes despite reopening outlets. Consequently, the sector is set for a make-or-break rebalancing period over the next few months. Refreshed lending agreements, cash conservation and supply chain management will be key.’
Steve Freeman, who heads up the national motor sector practice and motor advisory business at accountants MacIntyre Hudson, where he is a partner, said: ‘We have been in communication with many of our dealer and OEM clients and networks since Friday and understand that a number of dealers have sold parts to Nationwide and are owed money for the supply of these parts.’
He added that although they could be able claim under reservation of title clauses in the supply contracts, they might find it difficult to get their money back.
Another option for dealers would be to identify and reclaim any stock held by Nationwide that was subject to the clauses, he said.