By Bob Haeffner, Chief Financial Officer & Vice President, Operations
Dealerships can’t afford to get left behind in the AI shift that’s occurring. If you are a key decision-maker at a dealership, it’s essential to consider how artificial intelligence is a near-term necessity with measurable financial implications. The impact of AI on dealership performance is becoming more and more clear. As STELLA Automotive AI’s CFO and VP Operations, I have had the opportunity to discuss the implications of AI with fellow business leaders. Here’s my point of view on why automotive dealerships should embrace AI and how to navigate implementing AI in your dealerships.
If you haven’t already, it’s time to start using AI for dealerships
A fundamental shift is happening in customer service preferences. Research shows that 31% of customers already prefer using AI for service bookings, and this trend is accelerating, with 51% of Gen Z and 44% of millennials favoring AI solutions. This move is driven by a demand for immediate service, as common frustrations like missed calls, long hold times and limited after-hours assistance erode customer satisfaction and send them to competitors. Recognizing this, savvy dealership managers are adopting AI to modernize the customer experience. The industry is now at a tipping point, with 64% of dealers reporting they already use or have used AI in their operations, according to CDK Global.
Where AI is driving financial value today
The financial impact of AI hits all dealership departments:
Service department
In the service department, conversational AI offers a powerful solution by handling calls 24 hours a day, seven days a week. This immediately addresses a critical revenue leak, as many service departments see a staggering call drop-off rate due to long hold times. Further, they miss calls in off-hours, missing the opportunity to meet their customers’ needs. By leveraging AI, dealers can ensure every call is answered and more repair orders are captured. Ultimately, this leads to significant improvements in customer engagement and satisfaction, boosting retention and securing long-term revenue.
Sales
For car sales teams, AI streamlines lead routing and response time and improves marketing efforts. It presents an opportunity for CRM/CDP optimization, resulting in better lead engagement and higher close rates.
When using tools such as IntellaVoice, built by STELLA AI and Client Command, it enhances conquest marketing by moving beyond your existing customer database. The technology identifies anonymous, in-market shoppers in your area and proactively engages them with relevant, humanlike conversations. This transforms invisible prospects into tangible, booked appointments, feeding your sales team a consistent stream of high-intent conquest opportunities that would have otherwise been missed.
Parts
In the parts department, artificial intelligence is a pivotal partner for inventory management. AI helps optimize stock levels to reduce waste and enables predictive demand forecasting, which analyzes service records and seasonality to prevent the costly issue of parts obsolescence. This data-driven approach is key to profitability.
F&I
AI can help F&I departments with common challenges such as lengthy processing times. It unlocks efficiency as well as dynamic pricing. For customers, AI can be leveraged to offer a more personalized and seamless buying experience.
Is AI worth the investment?
For any dealership, the answer is an emphatic yes. The investment question shouldn’t be framed by setup costs, but by the significant and immediate returns AI delivers today. Consider the tangible ROI from day one:
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Recaptured revenue: Every call answered by AI that would have otherwise been missed is a recovered sales or service opportunity. This alone can generate thousands in revenue each month.
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Increased staff productivity: By automating repetitive tasks like answering FAQs and scheduling appointments, AI frees up your skilled advisors to focus on high-value activities like complex customer issues and closing sales.
The immediate financial return is only the first step on the “AI value ladder.” The true strategic advantage lies in the compounding returns for early adopters. The longer an AI system operates, the more data it gathers, and the smarter and more efficient it becomes at serving your specific customers. You are essentially building a proprietary data asset that your competitors cannot replicate overnight. When you work with providers like STELLA Automotive AI, we are consistently improving upon our technology. Our platform is constantly evolving, ensuring your dealership always has a competitive edge with the latest advancements in conversational AI.
Ultimately, the greatest risk lies not in the cost of adoption, but in the cost of inaction. While you wait, your competitors are capturing market share, streamlining their operations and building the customer experience that consumers increasingly demand. The initial investment in AI is easily offset by immediate cost savings and revenue capture, while positioning your dealership to lead for years to come.
The non-negotiables of AI implementation
The most important factors in embracing artificial intelligence for dealerships are integration readiness, data security, and analytics. When seeking out a demo, ask these key questions:
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Will it work with existing systems?
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Is the platform secure and SOC-2 compliant? Does it offer data integrity?
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What analytics and data will I have access to?
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Will your operators accept AI? Ensure you have buy-in throughout the organization before implementing AI.
These essential components ensure you can have the peace of mind that your investment is secure, integrated with your existing workflow and capable of delivering the measurable insights you need to drive real business growth.
The cost of waiting to implement AI
Now’s the time for dealership leaders to evaluate their current missed revenue and take action. AI is not just a tech initiative but a financial growth strategy that shouldn’t be ignored. Get a free demo of STELLA to see how it can protect and grow your bottom line.
