AI and the Automotive Dealership Landscape in 2024

As we usher in a new year, we reflect on the learnings from the previous year and set new goals for the next 365 days. These goals, more often than not, are propelled by emerging technologies that the preceding year didn't fully leverage. In 2024, artificial intelligence stands as the transformative force set to reshape the automotive industry, especially within the dynamic landscape of automotive dealerships.

Dealerships Will Embrace AI for Repetitive Actions

Dealerships, with roles that are often repetitive and demanding, are poised for a significant transformation through AI. Robotic Process Automation (RPA) is becoming the linchpin for operational efficiency and economies of scale in back-office functions. RPA, a technology designed to redefine administrative tasks, liberates human resources for more strategic, customer-centric roles. This leap forward aims to amplify productivity, cut costs and create a dealership ecosystem that is agile, responsive and wholly customer-focused.

Dealerships Will Embrace AI for Customer Support

According to a ZenDesk trends report, roughly 50% of customers will switch to a competitor after just one bad customer service experience. That number jumps to 80% on the second bad experience. Generative AI can revolutionize customer support functions, enhancing customer satisfaction and fostering higher retention rates. Dealers will approach the use of AI for customer service with the dual objective of optimizing personnel allocation for maximum business impact and elevating overall response times.

AI Will Be a Catalyst for Job Growth, not Reduction

Contrary to concerns about job reduction, the use of AI is projected to generate job growth rather than diminish it, particularly in areas where human interaction remains invaluable. Many dealerships currently grapple with an excess of open positions, often for less desirable roles. The implementation of AI not only fills existing staffing gaps but also catalyzes a ripple effect, creating additional jobs across the automotive sector.

While AI will play a prominent role in customer-facing functions, handling simple yes/no queries, the irreplaceable human touch comes to the forefront when emotions run high. For critical decisions, negotiations or when a customer faces unexpected issues, human interaction remains unparalleled. While customers will be more than happy to interact with AI when trying to determine if a vehicle is available for a test drive, they’ll prefer human interaction when their new vehicle is making an unexpected noise. Although customer service agents may utilize AI-powered tools for those interactions, the essence of the interaction will be driven by a skilled customer service agent.

Jim Roche Photo 2

Jim Roche (pictured, left) is founder and CEO of WarrCloud, a cloud-based warranty processing platform.