Artificial intelligence does not mean that people are no longer crucial in the dealerships business. AI has helped The Niello Company, a dealership group in California, become more efficient and compliant, but that just enhanced the effectiveness of its people, sales and finance director Dennis Gingrich told Wards Auto on a Zoom call.
“What AI is doing is making us more efficient in areas that traditionally take more time and energy to excel at, so I think we’re gaining efficiencies,” he said. “It’s putting the human in the loop at the right time more often, which is going to generate positive outcomes more frequently.”
The Niello Company, based in Sacramento, has eleven new car dealership rooftops encompassing BMW, Land Rover, Audi, Acura, Jaguar, Mini, Porsche, Volvo and Volkswagen franchises.
It uses AI across the group in a variety of ways, Gingrich said.
What follows are some key points on how The Niello Company is using AI now, and what it hopes to do with it in the future.
Deriving actionable insights from compliance reviews
The Niello Company works with attorney Robert Robards’ Automotive Systems Analysis company, which does manual deal jacket audits to ensure the folders include all the necessary compliance documents. The audit generates a large report with “probably more detail than, you know, the average store user is really gonna wanna dig into,” Gingrich said.
The California New Car Dealers Association also has many resources to help dealers ensure they are operating compliantly in what Gingrich called “the tricky California legal landscape.”
Rather than try to ingest and understand all that often legal information, The Niello Company has ChatGPT review it all and suggest actionable policies for the entire group to follow, “just so we can check the compliance boxes,” Gingrich said.
Employees can also query the database about specific issues, he said. Without ChatGPT, “Something like that would, you know, take a tremendous amount of time and feel like a monumental task because most people don’t speak legalese,” Gingrich said.
Crafting pay plans to “drive good behavior”
Gingrich uploads the details of employees’ pay plans into an AI tool, which analyzes sales compensation plans to suggest ways they might be changed to encourage salespeople to sell more new cars. While AI won’t write the whole pay plan, it does spur new ways of thinking, he said. “It’s just such an easy way to get thoughts flowing, and ideas.”
Helping employees understand their pay plans in the finance and insurance office, Gingrich has created an online area using Google Gemini where employees can ask questions about their pay plans in natural language. Including how they can sell more F&I products and how that will affect their compensation.
Using the tool, “they’re not worried about being embarrassed or whatever; I just think that helps overall drive productivity,” he said.
Optimize pricing across third party sites
The Niello Company advertises its inventory on AutoTrader, CarGurus, Carfax and Cars.com. Each site has its own criteria for categorizing a vehicle as a great or good value. “So, it’s like, okay, who you gonna chase?” Gingrich said.
Gingrich first downloads all of the inventory files from third party providers. Then using AI, he determines the price that will optimize for the best results across all four sites, taking into consideration which site The Niello Company wants to prioritize.
The AI tool just gives you a list, Gingrich said, “instead of sitting here trying to read the tea leaves on how what to figure that out because, you know, bouncing across four Excel files is a big ol’ waste of time.”
Watching service technicians’ customer videos
Tully Williams, The Niello Company’s fixed operations director, has begun using an AI tool to monitor and score the videos its service technicians send to customers explaining issues with their vehicles. “So now, we can really work on quickly improving the quality of their videos, which I think is really exciting,” Gingrich said.
What more should AI do?
In the F&I space, Gingrich figures there needs to be a way to see what service products a vehicle owner has purchased regardless of what dealership that owner goes to so the owner can easily use those products anywhere.
“You could come to any store in America with your car and say, hey, I need this, and there’s a good chance your service advisor might look in the factory portal and say well, sorry Alysha, you didn’t buy one of those. Yet you did, it’s just not in that portal. You can’t rely on the DMS data,” he said.
The biggest opportunity Gingrich sees for AI to improve the overall customer experience across the vehicle’s lifetime is tracking a customer’s experience with filing claims, and the amount paid out with specific protection products.
With such a product, when a repeat customer buys another vehicle from The Niello Company the initial purchase proposal would automatically include information on every protection product they previously purchased, how often it was, and pricing. “It’s just there, and nobody has to think about it,” Gingrich said, because “the best customer is your current customer.”
