More dealers are leaning into AI to boost revenue

While not new—AI is making its way into car dealerships at a record clip—changing how dealers interact with customers, manage inventory, and handle financing.

Initially, the industry was a bit slow to get on board, but now, 80% of dealers use or plan to implement AI in 2025, according to a Fullpath study. And for those already using it—100% reported revenue growth last year.

Why it matters: For years, dealers have been looking for ways to cut down wait times and make the buying process smoother, but real progress has been slow. Now, AI is finally helping move the needle in some cases.

• A Cox Automotive study found that buyers who complete key purchasing steps online—like credit applications and paperwork—save an average of 42 minutes at the dealership.

• New-car buyers save even more at 49 minutes, while used-car buyers cut their time by 40 minutes.

Basically—with tight margins, elevated interest rates, and inventory challenges, dealers are looking for ways to be more efficient without losing the personal touch that makes car buying an actual experience.

Marianne Johnson, chief product officer at Cox Automotive, told CDG News at the 2025 NADA Show that—when leveraged appropriately as an enhancement tool—the benefits of AI can be tremendous:

The latest and greatest: AI agents—virtual assistants backed by data—are taking over repetitive tasks like:

• Answering customer questions with real-time inventory updates.

• Scheduling service appointments and handling follow-ups.

• Analyzing customer conversations to find sales opportunities.

• Helping match buyers with financing based on real-time lender data.

The upside? Faster processes, fewer bottlenecks, and better use of dealer resources. This allows dealership staff to spend more time with customers and less time buried in tedious work.

The downside? If not done right, AI can feel impersonal or frustrating, especially when it’s running on bad or incomplete data.

Big picture: For better or for worse, AI is not going away anytime soon. The Fullpath study found that 81% of dealers plan to increase their AI budgets in 2025—but the real test will be whether these technologies enhance the buying process—or just make it more automated and impersonal.

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