Author: Matthew Muilenburg | Chief Product Officer, Impel
The automotive industry is undergoing a transformation as significant as the .com era—likely bigger—driven by the rapid rise of artificial intelligence. It reminds me of the first time I walked into Lexus HQ in Torrance. In the lobby, for everyone to see, the Brand Covenant – The Relentless Pursuit of Perfection. I was drawn to it immediately. Back then, as OEMs and dealerships scrambled to establish their online presence during the “Wild Wild Web” era, Lexus excelled at maintaining consistency amidst the chaos.
Today, we’re at another pivotal moment. Hundreds of AI solutions are emerging to support various stages of the customer journey, and it’s easy to get caught up in the tech and lose sight of the goal: maintaining a consistent brand and customer experience that drives outsized business results.
Retrieval Augmented Generation: the tech that creates your best employee
That’s why I’m so thrilled to bring Retrieval Augmented Generation (RAG) to the automotive industry. RAG enables AI systems to deliver dealership-specific interactions consistently across the customer journey. Think of it as the tech that makes your AI agent as knowledgeable as your best employee! When it’s used across an AI Operating System that supports the entire customer lifecycle, it not only reduces the risk of degrading the customer experience – it unifies and enhances it entirely.
The acronyms don’t matter, but the outcomes do. Let’s explore how this technology is advancing the industry while staying rooted in the principles that deliver business value.
How does RAG technology work?
RAG improves large language model (LLM) answers by linking the model to external data sources beyond its training data.
Unlike general AI models that rely solely on memory from their initial training, RAG connects AI systems to external, context-specific data sources. Imagine it as an “open-book exam” for AI, as IBM’s Luis Lastras describes. Instead of relying on memory alone, RAG-equipped AI can “consult the book” (i.e., dealership-specific information) to deliver informed and precise answers.
Why Automotive AI requires contextual data
Dealerships operate in vastly different environments, even when part of the same brand network. General-purpose models alone can’t meet those demands. Auto retailers and OEMs need adaptive, domain-specific models to accomplish their goals. At Impel, this has always included a blend of foundational open models for the fast-paced innovation they offer, and of equal importance, our proprietary verticalized models that provide industry fine-tuning and specialized control layers. Now, with RAG, dealers and OEMs get to train the model themselves as well.
Here are a few reasons why RAG and contextual AI are critical for automotive businesses:
1. Greater expertise means stronger results
Updating a RAG system is much like training an employee (except you don’t have to repeat yourself with RAG). The more context and experience it gains about your business, the better it performs. For Impel customers, this translates to increased sales and service appointments, reduced need for human intervention, and ultimately, greater profitability.
2. Unlocking agility
Automotive retailers and OEMs operate in fast-paced environments. RAG enables AI to absorb real-time updates, like inventory changes, and new services or offers, ensuring customers always get accurate information. For example, during the peak of tariff news cycles, dealers faced a surge in customer inquiries their staff wasn’t trained to speak on. By adding clear messaging to their RAG knowledge bank in Impel, they instantly updated AI responses across chat, sales, and service channels.
3. One, consistent source of truth
When dealers or OEMs operate their business through a single AI platform that pulls from a RAG system, all customer communication is seamlessly centralized. From talk tracks and policies to handbooks and promotions, everything is stored in one unified hub. This centralization means any updates or changes are made once and instantly applied across all customer interactions. The result? Significant time savings for dealers and OEMs, greater team efficiency and productivity – and faster, more accurate, and consistent customer communication.
4. Accurate brand representation
For dealerships, seamlessly aligning their identity with OEM requirements is crucial. RAG makes it easy by customizing AI systems to reflect each dealership and brand’s unique voice and values. This ensures every interaction reinforces their promise to customers. With RAG, dealerships can train AI to use their specific language—delivering a consistent, personalized experience at every touchpoint.
The Impel advantage in Automotive AI
Impel has a long history of bringing innovative technologies to the automotive industry. From implementing computer vision AI to represent inventory visually, to launching the first generative AI agents designed specifically for automotive, Impel has consistently stayed ahead of the curve.
By bringing RAG technology to the automotive industry, we’re enabling dealers and OEMs to deliver the seamless, high-touch experience today’s customers expect, without sacrificing efficiency or control.
Impel customers implementing this technology have seen:
The road to richer AI engagement
While many dealerships are embracing Automotive AI, Impel’s AI Operating System takes it a step further, offering deeper insights and capabilities for dealerships and OEMs. Imagine Automotive AI as a sharp, tireless employee—one with unlimited potential to handle detailed interactions exactly how you want them to, delivering exceptional results. Now is the time to leverage this technology to unlock greater performance and drive success.
Discover how Impel can transform your dealership operations.
Contact us today for a personalized AI consultation.