A recent study by Pied Piper has revealed that artificial intelligence is rapidly transforming the way automotive dealerships handle service calls, often outperforming human associates in key areas. The 2025 Service Telephone Effectiveness (STE) Study, which analyzed over 2,100 dealerships and 200 independent service centers, shed light on both the promise and limitations of AI in revolutionizing service operations.
The data indicated that dealerships relying on AI achieved an impressive success rate in handling service calls, with 91 percent of calls managed entirely by AI systems without any human intervention needed. These AI-handled calls often outperformed human associates, achieving an average STE score of 72, higher than the 2025 national dealer group average of 64. However, the study also highlights critical shortcomings, particularly when AI systems are unable to resolve certain calls and must transfer customers to human associates. When AI is not able to handle a request, it fails 56 percent of the time to transfer the customer to a human. This is where performance and customer satisfaction deteriorate significantly.
“A.I. now often outperforms human staff on service calls, but handoffs to people frequently fall apart,” said Cameron O’Hagan, Pied Piper’s Vice President of Metrics and Analytics. “Dealers must use A.I. as a tool—not a crutch—and stay committed to staffing and smooth transitions.”
AI Rises to the Occasion
Still, AI is successful overall when handling service requests and is always improving. The study highlights the growing reliance on artificial intelligence to handle both routine and complex service inquiries. For tasks such as scheduling regular maintenance or providing appointment options, AI systems proved highly effective, successfully resolving most queries without human input.
One of the key strengths of AI-managed systems was their ability to reduce common pain points for customers. For example, callers interacting with AI spent less time on hold and experienced fewer instances of incomplete service call handling compared to traditional human-driven processes. With an 86 percent overall success rate in scheduling service appointments, AI is positioning itself as a critical tool for dealerships seeking to enhance service efficiency. It’s effective, but not all the way there yet as that success rate jumps to 90 percent for dealerships who rely on humans to schedule.
The Challenge of Handoffs
These advancements are encouraging, but there is a significant weakness in AI-driven service systems. When AI fails to resolve a query and transfers the customer to a human associate, the quality of service plummets. The average STE score for these human-assisted calls dropped to 50, well below the national average for dealer groups and far behind the 72 achieved when AI is able to succeed alone.
“A service customer’s initial phone call is a dealership’s first step toward building loyalty and generating
revenue,” said O’Hagan. “Yet because these calls often go unnoticed in daily operations, problems are
easily overlooked.”
Common issues observed during handoffs included extended hold times, dropped calls, or a failure to properly address the customer’s needs. When AI solutions transfer calls to humans, smooth transitions are essential to maintaining customer satisfaction. Else these handoffs can undermine the efficiency gains offered by using AI at all.
The Potential is There
Despite some struggles, AI is still primed to transform the automotive service experience. However, this study shows the importance of human oversight and the need for seamless integration between AI and dealership staff. While AI offers clear advantages in managing high volumes of routine inquiries, its limitations in handling complex or multifaceted customer requests serve as a reminder of the irreplaceable role human associates play in ensuring a high-quality service experience.
For dealerships, independent service centers also present a competitive challenge. Although they generally scored lower on STE performance, they outpaced dealerships in specific areas, such as offering faster appointment availability and greater pricing transparency. This poses a risk for dealerships, as customers may opt for independent service centers if AI-driven systems fail to meet their needs effectively.
“Failure to schedule an appointment quickly may be all it takes for a dealership’s service customer to choose an independent shop,” said O’Hagan. “Dealerships work hard to avoid losing service customers, and the faster availability and greater price transparency of independents can be a real threat.”
By refining handoff procedures and ensuring that human agents are empowered to handle complex scenarios, dealerships can maximize the benefits of AI while minimizing potential disruptions. Proper implementation of AI allows efficiency and customer satisfaction to go hand in hand. Even as the technology continues to advance, the future of automotive service calls will depend on striking the right balance between technological innovation and effective human interaction.
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