FIXED OPS AND CONNECTED CARS ARE A GROWTH OPPORTUNITY • Dealers capture just 30% of post-warranty service work, which could rise as cars become more connected and complex. • OEM software will increasingly and literally (through maps) guide drivers back to franchised dealers for service — a reversal of the long-term trend toward independent shops. • He sees strong upside in fixed operations if dealers invest in training, technology and service excellence. • Consumers should start thinking about adding warranties to their vehicles just as they do extended care protection for devices like smartphones, he said. AFFORDABILITY CRISIS AND REPAIR COMPLEXITY • Vehicle repair inflation has outpaced overall inflation more than 2.5 times, driven by vehicle complexity and supply chain shocks. • Megacasting and vertically integrated EV components are making vehicles harder and costlier to repair. • Insurers are becoming selective, and rising premiums could further pressure affordability and demand. DIGITAL RETAIL AND AUTONOMY • Direct online car buying is still a “rounding error” and represents a negligible portion of total car sales, so small that it’s nearly insignificant in the overall numbers. Most consumers prefer face-to-face engagement. • Autonomous vehicles like Waymo are making progress, especially in dense cities, but Greenfield sees minimal threat to dealers in the near term. ARTIFICIAL INTELLIGENCE: MASSIVE “FORCE MULTIPLIER’ POTENTIAL • AI adoption (especially automated sales agents that can work 24/7 and serve as “co-pilots” to human sales reps) could dramatically improve dealership efficiency and reduce human capital costs. “Once you train [AI agents], they are a force multiplier,” he said, noting a savvy sales rep can (and has) become far more effective. • Dealers should push vendors to integrate AI for productivity gains and begin preparing for “generative engine optimization” (GEO) — optimizing online dealership content to ensure it is picked up and indexed by AI platforms like ChatGPT or Google, and served to consumers. FOCUS ON LIFETIME CUSTOMER VALUE • The top-performing dealers, according to 20 years of 20 Group financial data, focus not on extracting maximum profit per transaction but on building long-term, generational-customer relationships. Source: WarrCloud DEALER OPPORTUNITY: LIFETIME REVENUE Source: Bank of America 16 Virginia Auto Dealer
RkJQdWJsaXNoZXIy MTg3NDExNQ==