We’re excited to catch up with our good friend, Steve Greenfield, general partner at Automotive Ventures and host of the CBT News series The Future of Automotive. During today’s discussion, Greenfield shares his perspective on dealer optimism, challenges surrounding direct-to-consumer sales models, and the future potential of AI in dealership operations. As the industry navigates the complex challenges of shifting technologies and consumer expectations, he provides a balanced outlook on how dealers and manufacturers can adapt to maintain profitability and deliver exceptional customer experiences.
Key Takeaways
- Greenfield highlights a prevailing sense of optimism among dealers at the 2025 NADA Show, bolstered by the election results and positive market sentiment. However, he underscored the ongoing friction between dealers and OEMs experimenting with direct-to-consumer sales models, particularly through new brands like Volkswagen’s Scout and the Honda-Sony joint venture, Afeela. He emphasizes that these models pose a significant challenge to the traditional franchise system, which he believes remains the most efficient and effective way to sell vehicles globally. He also warns that state dealer associations and NADA must stand firm against these experiments to prevent further erosion of the dealer franchise model.
- Despite OEMs attempting to replicate Tesla’s direct-sales success, Greenfield argues that these efforts are unlikely to succeed on a large scale. He points out the inefficiencies and logistical hurdles of launching new brands and delivering cars without dealer involvement. The franchise model has proven advantages, such as personalized customer interactions, test-drive opportunities, and dependable service networks, consistently outperforming direct-sales experiments. He also notes that dealers play a critical role in managing recalls and maintaining customer satisfaction, roles that direct sales models struggle to fulfill effectively.
- Greenfield addresses the buzz surrounding AI at the NADA Show, expressing disappointment that most vendors focus on surface-level applications like marketing tools rather than solutions that could reduce dealership operating costs. He highlights the potential for AI to streamline human capital expenses—currently accounting for 70% of a dealership’s monthly costs—by enabling higher productivity and throughput with fewer employees. While he understands and acknowledges the industry might not yet be fully prepared for these transformative changes, he encourages dealers to demand AI solutions that directly improve operational efficiency and profitability, predicting that such innovations could take center stage at future NADA events.
Catch all of CBT News’ coverage of the 2025 NADA Show here.
