Zach Shefska and his auto dealer father, Ray, founded CarEdge in 2020.

Ask any dealership sales team about their pain points, and they’ll inevitably mention lead bloat — a flood of online leads and inquiries, most of which go nowhere. Third-party listing websites and lead generators grew quickly as retail auto sales transitioned online in the mid- to late 2000s. These websites often blast the same customer inquiry out to multiple dealerships, creating a frenzy in which five stores chase one lukewarm prospect.

The result is wasted time and money: The average dealership converts only about 2% of its third-party leads into sales; however, third-party leads make up a significant amount of total lead volume.

That means salespeople must sift through countless inquiries to sell just one car, or dealers must invest in expensive business development centers, adding to their already high-cost infrastructure.

The incentives in today’s system are misaligned. Many third-party platforms profit from quantity of leads, not quality of outcomes. Dealers and OEMs end up paying for lots of noise and very little signal. This traditional model leaves everyone dissatisfied. Consumers feel pestered and distrusted, and dealers waste resources chasing ghosts.

It’s no wonder then that this paradigm has led to the largest gap between dealer and consumer expectations, ever. More than half (61%) of dealers believe buying a car from a dealership is “completely optimized” whereas only 37% of consumers agree.

There is a lot of work to be done to close this gap, and improve the overall experience for the entire marketplace.

AI to the Rescue

Is there a better way? Yes, and AI will usher in change at an unprecedented rate. This isn’t about killing the dealership model. It’s about realigning incentives so that both buyers and sellers can win.

A recent survey found that 25% of consumers are already using tools like ChatGPT to assist them in purchasing a vehicle, and that 40% of consumers say they will use AI tools to support them in their future vehicle purchases. AI adoption at dealerships is significantly higher (albeit nascent in scope), with nearly 90% of dealerships reporting they have already deployed AI at their store.

AI is a powerful tool for rebuilding and rewarding transparency and trust, which is at an all-time low. Only 7% of Americans say they trust car salespeople, according to Gallup. That’s dead last across all professions. But it’s not just perception — it’s the process.

Dealers are overwhelmed by lead bloat and poor retention. The turnover rate for dealership sales consultants is nearly 72%. The system burns everyone out, and is rife with deceptive pricing practices, with online advertised prices often differing significantly from the final out-the-door price due to hidden fees and add-ons. This not only frustrates customers but also hurts reputable dealers who don’t play these games — and this broken system hurts their bottom line.

Agentic AI solves this by collecting and publishing real, out-the-door pricing data from thousands of dealerships. We can identify which dealers are transparent and which are adding “mandatory” fees, such as for nitrogen tire fills. This allows honest dealers to stand out in a crowded market, giving them a competitive edge and helping them attract more sales from informed, trusting buyers.

From Asymmetry to Transparency

Agentic AI is fundamentally recalibrating the auto industry by moving it away from a model of information asymmetry and inefficiency to one built on trust and transparency. The car-buying process has historically left everyone frustrated, but CarEdge is demonstrating that a new model is possible. The company utilizes intelligent AI agents to prioritize data and a customer-first approach, showing that technology can be a force for good. Dealerships that embrace this change can escape the costly cycle of distrust, build lasting customer relationships, and ultimately thrive in a more efficient and fair marketplace. The future of car buying, according to this perspective, is already here and is driven by these intelligent agents.

Nearly 90% of dealerships say they’re already experimenting with AI. But most of that usage is surface-level — automated chatbots, follow-up texts, maybe some CRM tools. Agentic AI empowers both sides of the marketplace. At CarEdge, our AI agents represent buyers in real time and gather full transparency on pricing — including dealer markups and add-ons — so shoppers don’t have to go digging. That’s the difference. We’re not just automating tasks; we’re flipping the power dynamics.

Honest dealers benefit the most. Our system rewards transparency by directing better-informed, ready-to-buy customers their way. No more chasing ghost leads. We’re giving time back to sales teams and letting them focus on what matters — conversions and customer experience. It also reduces overhead. Imagine a world where two AI agents — one representing the buyer, the other the dealership — negotiate instantly. That’s where we’re heading.

For retail automotive, third-party car shopping websites will evolve to look more like ChatGPT. Imagine an intuitive interface where you can ask questions, share input and, ultimately, be presented with options that work for you. AI will change how consumers research and decide on the vehicle they want to purchase.

• Dealership staff will spend less time explaining features and capabilities — customers will have vetted that information with their AI shopping agent first.
• Sales consultants won’t waste time chasing leads that aren’t in the market to shop — instead they’ll get notifications from buyer’s AI shopping agents that the customer is ready to purchase.
• Because consumers will be more educated and empowered before contacting a dealership, we will see a fundamental shift in the leads business away from quantity and towards quality. This is good.

Agentic AI also presents a compelling use case for consumers and dealers to hand off even more of the rudimentary grunt work of car-buying. Why would I go to the dealership and haggle with the salesperson when my AI shopping agent can do it for me? As a dealership operator, why would I employ a sales consultant and sales manager to negotiate with an AI agent? I wouldn’t. For these customers, AI agents will handle it instead.

Agentic commerce means agentic commerce. Agents representing both consumers and dealers will engage with each other. Cost infrastructure will come down and time will be given back to the humans previously in the loop.

AI’s impact on retail auto will be (and already is) profound. From vehicle research and selection, to negotiation and pricing, agentic AI brings much needed transparency and efficiency to an industry that desperately needs it. The dealers and OEMs who embrace this new model won’t just survive, they’ll lead. The age of agentic AI is here, and it’s time we start building with it.

Zach Shefska is CEO and co-founder with his father, Ray, of CarEdge, a leading consumer-to-dealer, AI-powered car shopping platform.