How AI and Technology is Reshaping the Car Buying Journey

We are now decades into the digital age, and it’s clear that car buying is still adapting. Today, more shoppers are researching online, using AI to make purchasing decisions, and even completing the entire purchase process digitally. In 2025, automotive dealers need to be incorporating AI into their online customer experiences to meet and exceed shopper expectations and avoid falling behind.

The Digital Shift in Car Shopping

Whether it’s for buying cars or anything else, it’s not just the digital native Gen-Z and Millennials that are shopping online; according to Fullpath’s recent report, “The Role of Technology & AI in the Modern Car Buying Process 2025,” 48% of respondents are shopping online every week. 

Modern consumers are highly active online, interacting with dealerships and brands across industries through various digital avenues. Nearly all shoppers (94%) use social media weekly, while almost half (48%) shop on e-commerce sites at least once a week. Simply put, your dealership’s online presence needs to be fresh, relevant, and user friendly. If you’re not engaging customers on social media or maintaining an informative, functional website, you risk losing sales opportunities to your competitors.

We’ve all heard the rumors that car buying is going fully digital—but the Fullpath report indicates otherwise. Only about 5% of shoppers completed their last car purchasing process entirely online and for the remaining 95%, the preferred experience is largely hybrid: online research combined with in-person visits, with about 15% sticking solely to dealership interactions. This shows that buyers increasingly rely on online research for financing options, trade-in deals, and vehicle features making comprehensive, accessible information online essential to supporting these modern hybrid shopping behaviors to ensure a convenient process for consumers.

Today’s shoppers are accustomed to doing pretty much every kind of shopping online. While purchasing a vehicle involves a more significant investment, the expectation of a seamless, convenient online experience remains the same. Consumers anticipate the same digital ease in car shopping as they do with other retail transactions, and adapting to this shift is crucial for dealerships seeking to stay competitive.

AI as a Trusted Tool for Car Buyers

Dealerships are increasingly leveraging AI tools like ChatGPT to enhance sales, marketing, and operations. Given that some hesitancy still exists within the industry regarding AI adoption, it’s possible that your shoppers may be even more comfortable with this technology than you might realize.

A clear majority (62%) of survey respondents indicated they would be comfortable receiving guidance from AI during the car buying process. Unsurprisingly, Millennials and Gen-Z are the most confident in using AI for their research.

Although only 16% of respondents have actually used AI for their research, with most shoppers still relying on dealership websites, search engines, and car review sites for information, the increasing comfort and familiarity with AI tools among both younger and older consumers should not be overlooked. Your marketing team is probably already employing Search Engine Optimization (SEO) to attract website traffic from traditional search results. However, with AI platforms like ChatGPT and Perplexity sourcing answers in new ways, it’s crucial to start integrating Generative Engine Optimization (GEO) strategies into your marketing efforts to position your dealership as a trusted source of relevant information that will keep showing up in both regular and AI-powered search results.

What Shoppers Expect from AI-Enhanced Experiences

Shoppers aren’t turning to AI just because it’s the latest technology or because a friend recommended it. They’re using it because after just one search, they realize how powerful, impactful, and genuinely helpful AI tools can be. AI-driven search capabilities provide shoppers with:

Speed, Relevance, and Transparency

AI can deliver highly relevant answers within seconds, significantly reducing the time shoppers spend searching for information. Advanced AI can understand context and reference sources—like links or data citations—so customers know where the information comes from. This transparency builds trust and confidence in the guidance they receive.

Personalized Answers 

Unlike traditional chatbots limited to scripted FAQs, AI-powered solutions tap into vast datasets, including current inventory, vehicle specifics, and customer preferences. This enables them to craft personalized, context-aware responses that directly address the shopper’s questions, making interactions more meaningful and helpful.

Human-Like Help, 24/7

Whether shoppers are engaging with your website’s AI chatbot, using AI-enhanced search engines like Google or Bing, or interacting with an AI specific platform, they expect assistance that feels natural and approachable. With Large Language Models (LLMs) sounding increasingly human, customers won’t feel like they’re talking to a robot. They get instant, conversational support anytime they need it, regardless of business hours.

The Generational Advantage

Younger shoppers are at the forefront of AI adoption, but they also value the in-person dealership experience more than one might expect. Among survey respondents aged 18 to 27, 67% said visiting a dealership in person was very important, more than any other age group. This only goes to further prove how important a hybrid approach to dealership marketing and sales is. Your long-term strategy should reflect this balance, integrating AI-driven online tools with engaging in-person interactions that meet the evolving expectations of today’s and tomorrow’s buyers.

Preparing now for a future with even greater AI influence is crucial. The youngest survey respondents are already highly comfortable with AI, but the next generation will be true AI-native consumers—just as Millennials are to the internet today. As they become the dominant market segment, dealerships that proactively adapt their marketing and sales tactics will earn loyalty early and secure a competitive edge. Investing in AI-driven strategies and blending digital convenience with human connection now will position your dealership for sustained success as these generations shape the future of automotive retail.

How Dealerships Can Embrace AI as an Opportunity

By integrating AI into your dealership’s website before your team even interacts with shoppers, you’ll automate many routine tasks that currently consume time—such as pre-qualifying customers and estimating trade-in values—giving your sales team a valuable head start. AI can quickly conduct pre-qualification checks and provide initial insights into a customer’s interests and status, allowing your team to be more prepared and proactive.

Within an AI-first Customer Data Platform (CDP), all this information is gathered and organized in one place. Whether it’s a summary of a chatbot conversation, an analysis of their vehicle preferences based on clicked ads and visited VDPs, or suggested financing options based on current vehicle equity and trade-in potential, the CDP collates these insights seamlessly. By leveraging these data points, AI can then activate personalized marketing efforts—sending hyper-targeted emails, SMS service reminders, or tailored offers—enhancing the customer journey with relevance and timing.

But these benefits only occur if your team is comfortable and confident with AI tools. Not everyone will immediately embrace new technology, so it’s vital to provide ongoing training—not just on how to use AI but also on why it benefits them and improves their workflow. When your team understands AI’s role in empowering their daily tasks, fears of automation replacing jobs diminish. Instead, they see AI as a tool to help them:

• Conduct more personalized and relevant in-store and online conversations;
• Identify high-value opportunities within the CDP that might be overlooked manually;
• Build granular audience segments for more precise targeting;
• Automate time-consuming, non-strategic tasks such as scheduling appointments or sending service reminders;
• Generate regular reports and insights based on customer data stored in the CDP.

Modern car buyers today demand a seamless, efficient, yet personalized experience. In fact, 85% of recent car buyers said personalized communication from dealerships, including timely messages and relevant offers, was important to them.. When dealerships leverage AI strategically by integrating it into their data and marketing operations, they can create a smarter, more responsive customer journey. 

AI Is the New Front Door to Your Dealership

When dealerships embrace AI as a tool for increasing efficiency, delivering better customer experiences, and ultimately driving more sales, they position themselves ahead of their competitors. The real threat to market share comes not from AI itself but from those who fail to adapt.

If you haven’t already, spend just 10 minutes exploring the customer AI experience. Take some of the most common questions your shoppers ask and compare the answers provided by ChatGPT versus traditional Google search results. The difference is clear—optimizing your marketing to appear in AI-powered results is essential for staying competitive and ensuring your dealership remains top-of-mind for modern buyers.

Want to integrate AI into your dealership’s digital journey the right way? Book a demo with Fullpath to see how our CDP platform leverages AI and automation to convert online curiosity into real-world sales.