The service drive is now the profit engine. The experience hasn’t caught up.
The state of vehicle ownership is changing as fast as the technology inside modern vehicles.
For starters, with advances in vehicle durability and rising new car MSRPs, people are holding onto their cars longer than ever. In fact, the average car on the road is a record-breaking 12.5 years old, driving a structural surge in service demand. At the same time, recalls have increased by 46% in recent years (Source: National Highway Traffic Safety Administration). As a result, the service drive isn’t a support function anymore. It’s the profit engine.
However, it’s also the engine of retention, loyalty, and repurchase — but only if the experience meets what customers expect. And right now, it isn’t.
The customer expectation gap, quantified
First and foremost, the competitive ground is shifting fast, and dealerships are losing it.
According to Cox Automotive’s 2025 service retention study, dealers have lost 12% of their service business since 2018, as customers steadily defect to independent repair shops, quick-lube chains, and mobile service providers. What’s more, the trend is sharpest with newer vehicles. In 2023, 72% of customers with cars two years old or newer returned to their selling dealer for service. By 2025, that number had dropped to 54%.
On top of that, speed and convenience are doing most of the damage. J.D. Power’s 2026 U.S. Customer Service Index found that maintenance visits — the most routine type of work — take roughly three times longer at dealerships than at aftermarket facilities. For instance, 62% of aftermarket service visits take less than an hour. By contrast, mass-market customers wait 1.61 hours at dealerships, and premium-brand customers wait 2.46.
So what’s the answer? The dealerships closing this gap are creating service experiences that match the seamless ease customers expect everywhere else in their lives. After all, today’s consumers are accustomed to ordering groceries, scheduling home repairs, and buying almost anything with a few taps in apps that personalize based on past behavior. They’re not going to accept less from their dealership. As Impel’s CPO Matt Muilenburg argues in The Dealership Is Not a Building Anymore, the modern dealership is defined by the experiences it delivers — not the four walls it operates inside.
Where the friction lives — and what it’s costing
In practice, three friction points account for most of the customer defection happening in the service drive right now.
Mass marketing in an era of personalized expectations
On one hand, dealerships have a wealth of first-party customer data — personal details, preferences, vehicle-specific history. On the other hand, most still rely on generic, mass-marketing tactics. Ideally, an ideal customer experience consists of timely, relevant communications tailored to the customer’s vehicle and behavior. Instead, most customers get impersonal blasts arriving at random times.
As a result, the customers feeling unseen are the ones already shopping for alternatives. For example, Impel’s customer data shows personalized service AI communications reduce customer opt-outs 4x compared to generic messaging. In other words, that’s a direct measure of how much engagement gets recovered when the dealership stops treating customers like a list.
Scheduling friction at the moment of intent
Each month, dealers invest tens of thousands of dollars in service marketing with one primary goal: booking appointments. However, the booking process itself is notoriously painful.
For instance, the average customer is put on hold for eight minutes before anyone speaks to them (Source: CDK Global). What’s more, most online forms require pages of detailed information the customer has already provided, driving up abandonment rates.
Ultimately, convenience determines whether customers choose a repair shop or a dealership. And every minute of friction is a minute the competitor down the street has to win the appointment.
Staff turnover that breaks process consistency
Meanwhile, high turnover and staff shortages in the service drive make it hard to train employees and keep processes consistent. In a typical store, service advisors juggle planning for future appointments while assisting current customers in person and on the phone. Yet staff expertise and OEM certification are among the main reasons customers choose dealership service drives over independent shops. In short, limited access to knowledgeable advisors erases that advantage fast.
How leading dealerships are closing the gap
Across the board, dealerships with a loyal customer base and high service absorption rate operate differently. First, they see themselves as customer service centers that happen to sell cars. Second, they drive profitability by deploying AI specifically against the friction points that drive defection.
Specifically, the work happens across three dimensions:
Personalized outreach at scale. In reality, effective service outreach requires far more steps than humans can possibly handle across tens of thousands of customer records. Instead, AI engages in personalized, proactive outreach that anticipates needs and reaches each customer in the right channel at the right time — based on VIN-specific intervals, service history, driving behavior, and OEM-recommended maintenance.
Scheduling that disappears into the conversation. No callback. No web form. The customer texts back a day and time; the appointment is booked. Even better, missed and overflow calls captured by Voice AI shift to SMS automatically so the appointment still gets booked.
Service updates that push automatically. Status, photos, recommended additional work — the customer sees it without asking. Behind the scenes, post-CSI nurture, declined-services follow-up, and next-service reminders all happen without anyone on the team building a list.
As a result, the customer experiences a service drive that just works. Meanwhile, the team experiences a service drive that runs without the constant friction of chasing, calling, and reminding.
The ROI of closing the gap
In hard numbers, investing in the modern service drive produces measurable returns. For example, dealerships running Impel’s Service AI consistently see:
- 27% increase in ROs from existing customers
- 33% of customers returning after they had stopped servicing
- 24% increase in vehicle repurchase rates
- +95 more completed ROs on average
That’s the headline math. Underneath it, three structural shifts move the P&L:
First, increased ROs. As a result of streamlined processes and proactive outreach, dealerships see higher RO quantity and revenue. Specifically, Impel customers who augment their first-party data-driven marketing increase monthly Repair Orders by 27%.
Second, reduced labor cost per RO. In practice, AI absorbs the mundane and repetitive work that bogs down BDC reps and service advisors. In turn, the capital freed up can be reinvested into existing employees or customer-experience upgrades — waiting room facilities, loaner vehicles, mobile service.
Third, improved customer lifetime value. Notably, 74% of car buyers whose vehicle was serviced by the dealership of purchase are likely to return there to buy their next vehicle (Source: Cox Automotive). In short, engaging service customers consistently with the right messaging keeps them coming back for service — which makes repeat purchases the natural next step.
Closing the gap is a 2026 operating decision
Ultimately, the dealerships that thrive in 2026 will be the ones that recognize what the J.D. Power and Cox data are actually saying: customers are voting with their feet, and the vote is going to the operator who removed the friction.
The race is on. In fact, catching up against competitors who already operationalized AI gets exponentially harder every quarter.
Frequently asked questions
How does AI improve the dealership service drive? AI improves the service drive by automating personalized outreach based on VIN-specific intervals and service history, capturing missed calls and shifting them to SMS, scheduling appointments without manual data re-entry, and surfacing next-best actions for service advisors. Dealerships using AI see 27% more ROs from existing customers, 33% winback rates on lapsed servicers, and 24% higher vehicle repurchase rates.
Can AI work with my existing service scheduler? Yes. Impel’s Service AI seamlessly schedules appointments inside email and text conversations through integration with leading dealership schedulers like Xtime. Customers reply with a day and time; the appointment is confirmed and booked. For OEM-aligned dealerships, explore Impel’s OEM Programs for certified, co-op-eligible solutions. Visual merchandising tools like 360° WalkArounds can also support the service-to-sales handoff at trade-in conversations.
Ready to close the gap in your service drive?
Impel is the only enterprise-grade AI Operating System purpose-built for automotive retail — connecting service, sales, marketing, voice, and chat into one coordinated platform.