Dealers' Secret 2026 Profit Playbook: How AI, Used Cars & Service Departments Will Save Your Dealership

How Dealers Plan to Boost 2026 Profits Amid Flat New-Car Margins

As new-vehicle sales aren't making dealerships as much money as they did a few years ago, some stores are leveraging their people, processes and technology to fill profit gaps in 2026.

Key Survey Findings

• Automotive News from Dec. 4-Jan. 9 surveyed 140 dealer principals, owners, CFOs, controllers, general managers and dealership executives.
• Dealers this year are boosting profits in two ways: by connecting with their customers better and streamlining their processes, experts say.
• Fifty-eight percent of respondents said they are already using AI in their stores and another 26 percent plan to.

The Profit Strategy Breakdown

With flat new-car margins squeezing traditional revenue streams, forward-thinking dealers are turning to alternative profit centers. The survey reveals a clear three-pronged approach:

1. Used-Vehicle Sales - Becoming a primary profit driver as new vehicle margins decline
2. Service Departments - Leveraging existing customer relationships for ongoing revenue
3. AI Tools - Implementing technology to improve efficiency and customer engagement

The AI Revolution in Dealerships

The most striking finding is the rapid adoption of artificial intelligence. With 84% of dealers either using or planning to use AI, this represents a fundamental shift in how dealerships operate. These tools are helping dealers connect with customers more effectively while streamlining internal processes that were previously time-consuming and inefficient.

Why This Matters for Dealership Staff

For customer service professionals and sales teams, this shift means:

• More focus on building lasting customer relationships beyond the initial sale
• Increased importance of service department interactions for customer retention
• Integration of AI tools to enhance, not replace, human customer interactions
• Greater emphasis on cross-departmental collaboration to maximize customer lifetime value

The automotive retail landscape is changing, and successful dealerships are those adapting their strategies to focus on customer relationships and operational efficiency rather than relying solely on new vehicle sales margins.