There’s an old story about a customer who returns a brand-new shovel to a hardware store. When the manager asks what’s wrong with it, the customer shrugs: “It didn’t dig the hole I needed.” The shovel worked fine. The customer simply expected the tool to do the work. It’s a familiar trap, and automotive is living through its own version of it with AI.
More than 25 years ago, the CRM arrived to improve customer experience and retention. Implementing it forced dealerships to rebuild legacy workflows, departments, KPIs, and comp plans. Over time, the CRM, BDC, and training ecosystems grew into multi-billion-dollar industries. And the dealers who invested in their people, processes, and systems realized the greatest gains.
We’re four years into AI’s rapid ascent, and the pattern is repeating. After working alongside thousands of dealerships navigating adoption, my colleagues and I are more convinced than ever: the gap between dealerships that thrive with AI and those that don’t isn’t a technology gap. It’s a change management gap.
What Change Looks Like in Practice
Leading dealerships have restructured their sales floor, service drive, and BDC workflows so people and AI win together, defining when a team member stays engaged and when to let AI take over follow-up. They invest in the AI Knowledge Bank, treat their AI as a silicon employee, and evolve comp plans and KPIs so the entire dealership is aligned.
As Devin Kaulback, General Manager of Subaru of Niagara, put it: “The mistake organizations make is treating AI like another piece of software, turning it on and expecting results. It works when there’s a clear implementation plan behind it. Once the team understood AI was there to strengthen their effectiveness—not replace the value they bring—adoption changed.”
Three Tiers That Make or Break Adoption
Long-term success maps directly to how deeply a dealership engages three layers of its organization.
Executive leadership must own the AI vision and define success. The strongest executives share a clear belief: AI and their people, working together, will improve satisfaction, strengthen retention, and grow the bottom line.
General Managers are the operational bridge. They determine whether AI leads get prioritized or buried, whether AI service recommendations are acted on or overridden. The strongest GMs champion the new workflows and make sure their teams understand the “why.”
Frontline teams are where AI wins or loses—the BDC managers, service advisors, salespeople, and marketers. Winning dealerships train them thoroughly and align compensation to the new work. And AI providers share responsibility: we have to give this group the tools and understanding to succeed.
“My team was skeptical. They assumed AI was here to replace them,” said Daniel Kim, Director of Operations, Barnes Crossing Automotive Group. “What won them over was watching it take the grunt work off their plate: the after-hours follow-ups, the dead leads, the endless emails. Once we trained them on the new workflow and tied their comp to the things only a person can do—the live conversations, the closes, the relationships—buy-in stopped being a problem. The numbers prove it: 50% more leads per agent, a 99% contact rate, and higher appointment rates. Now it’s just how we operate.”
When all three tiers engage, the results are unambiguous: retention improves, closing rates climb, revenue grows, and holding costs drop.
Getting It Right
For any dealer group preparing for a rollout, success comes from a phased approach that earns trust before it demands transformation.
Start with strategy, not features. Before anyone discusses a product, leadership needs to align on what problems the AI will solve. If you can’t state the objective in a single sentence, you’re not ready to deploy.
Map the new workflows before going live. When does the human hand off to AI? When does AI hand back? What triggers escalation? If those questions can’t be answered clearly, your team will build workarounds that quietly undermine the investment.
Rethink compensation. Align incentives to where humans add irreplaceable value: live conversations, show rates, conversions, loyalty. Let AI handle the volume; your people close the deals.
Treat the first 90 days as calibration, not completion. A single onboarding session isn’t change management. Build a recurring cadence where teams review performance, identify friction, and iterate.
The Real Edge
The global automotive AI market topped $18 billion in 2025 and is growing at double-digit rates. In other words, there are a lot of shovels out there. But the dealers seeing the greatest wins aren’t the ones who simply bought the solution, they’re the ones who evolved their workflows and aligned all three layers of their organization around it. They’re the ones digging the holes with the right tool. And we’re only four years into this transformation.
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