OEMs Bet on AI to Boost Dealership Profits Amid Tariff Pressures…

Event summary

59% of OEM executives believe AI will increase dealership profits, with only 4% anticipating a decrease.
88% of OEMs expect buy/sell activity to accelerate or hold steady in the next year.
58% of OEM executives plan to absorb most tariff costs themselves rather than passing them to dealers.
OEMs project EVs will represent 21% of sales within five years, more than double current US market share.

The big picture

OEMs are increasingly viewing AI as a structural profitability driver for dealerships, even as they brace for tariff-related headwinds. The survey results suggest a long-term shift toward fewer, larger dealership networks with higher blue sky valuations, reflecting broader industry consolidation trends. Despite softening new vehicle sales outlook, OEMs remain bullish on EV adoption, underpinned by substantial investments in electrification.

What we're watching

AI Adoption Pace: How quickly AI deployment will translate into measurable profitability gains for dealerships.
Consolidation Trends: Whether the projected reduction in dealer networks will accelerate or face regulatory hurdles.
Tariff Cost Management: The extent to which OEMs can sustain tariff absorption without significantly impacting vehicle pricing.