Artificial Intelligence: Improving the Automotive Industry

“It was the machines, Sarah. Defense network computers. New... powerful... hooked into everything, trusted to run it all. They say it got smart, a new order of intelligence. Then it saw all people as a threat. Decided our fate in a microsecond: extermination.”

Kyle Reese on SkyNet. The Terminator, 1984

Don’t worry. The line above is pure science fiction. It’s Kyle Reese (John Connor’s father), coming from the future to save Sarah Connor in the epic Arnold Schwarzenegger movie, The Terminator. Contrary to Hollywood stereotypes like these, however, Artificial Intelligence doesn’t mean the machines are coming to get us.

We get it, people fear AI. And beyond the Hollywood hype, much of the fear is based on the notion of lost jobs as new technology makes some occupations irrelevant. But The reality is that adopting AI does not mean the Terminator will be hunting down Sarah Connor anytime soon. And it doesn’t mean you will lose your job. In fact, from 2012 to 2022, Automotive retail employment in the United States grew from 1.7 million to just under 2 million people. So how else is it affecting the automotive industry today?

AI is helping automotive design, supply chain management, and production

AI has been one of the most disruptive technologies across most industries in recent years, with automotive being no exception. AI is helping automotive design, supply chain management, and production by optimizing data for faster decision-making. It’s helping in automotive marketing by fine-tuning media buys to find in-market shoppers and helping in retail by guiding shoppers through their online journeys.

AI is making designers, supply chain managers, manufacturers, marketers, and dealers more productive. These employees are able to bring better products to market faster and more efficiently. The utilization of AI is making it easier for everyone to shop for and purchase a vehicle that matches their lifestyle wants and needs.

AI is positively impacting sales, inventory management, service, and parts departments

According to a 2023 survey by CDK Global, 76% of dealers credited AI with positively impacting their sales, inventory management, service, and parts departments. The study’s respondents said AI optimizes employee skillsets and automates tasks, including identifying qualified sales leads, building targeted marketing messages, and proactively converting prospects, allowing sales staff to focus on improving customer service.

Ultimately, the use of AI helps strengthen employee performance and guard against employee burnout.

AI is transforming marketing campaigns and increasing conversion rates

The ability to target in-market shoppers has been transformed by AI technology. By analyzing large datasets of consumer behavior, AI algorithms can predict which individuals are likely to be considering a car purchase. With this information, OEMs and agency partners can create highly personalized marketing campaigns, ensuring the right message reaches the right customer at the right time. This helps in reducing marketing waste and increasing conversion rates.

AI is a pivotal tool for creating efficiency, personalization, and smarter operations

Artificial intelligence is not just a buzzword in the automotive industry but a pivotal tool for creating efficiency, personalization, and smarter operations. From the factory floor to the final sale, AI enhances each aspect of automotive manufacturing and marketing. As OEMs and dealers continue to harness AI, the industry will become even more innovative in product development, design, and customer service.

And if you see someone who looks like the Terminator at your dealership? Don’t panic. The dealership probably used AI to hook him up with the right vehicle. And, if you hear him say, “I’ll be back,” it probably just means he’s coming in for vehicle service or a new car.