Though all-too-frequent references to artificial intelligence nowadays may make many people’s eyes glaze over upon mention of it, car dealers recognize it’s not going away, and most are gradually integrating it into their business.

A new Cox Automotive study found 81% of dealers see AI is now a technology fixture, and in fact 63% consider it crucial to their long-term business results. Still, many don’t entirely trust it, the research found.

To assess AI trends in auto retail, Cox surveyed more than 500 franchised dealers in phases in April and August, including conducting focus groups and interviews.

It found that 60% of dealers have started to explore AI capabilities for their business and almost 15% have added AI into dealership tasks and decision-making, typically first in marketing, including leads management and communication. One go-to assignment in that area is anticipating which customers could be in the market to buy. 

Other areas dealers are tapping AI most are back office, sales, finance-and-insurance, and service drive. In all of their experimentation, they’re looking for solid results, Cox said.

“Dealers don’t care about AI for AI’s sake,” said President of Retail Solutions  Lori Wittman. “They care about outcomes they can measure—more cars sold, lower inventory costs, higher gross profit.”

Dealers have a healthy amount of skepticism when it comes to AI, though, 74% concerned about factual accuracy and 60% about data and algorithms. 

In addition, 66% see the need for more training on the technology, “underscoring that dealers want to be able to discern AI credibility from hype so they can operationalize it, extract value and achieve outcomes,” said Cox, which pointed out the sea of AI providers that can be hard for dealers to wade through and find credible fits.

“AI can’t be just another point solution in a dealer’s tech stack—it must be connected to sophisticated and proven data infrastructure focused on unlocking intelligence that can solve specific pain points and deliver measurable results,” Wittman said.

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