In recent weeks, we’ve seen vendors in the Retail Warranty Reimbursement space heavily promoting the use of artificial intelligence (AI) as the latest breakthrough in processing efficiency and accuracy. While the buzzwords sound impressive — “AI-driven job classification,” “better analytics,” “faster turnarounds”— the reality is often far less revolutionary. In fact, these AI-driven shortcuts may come at the expense of the very thing that matters most to your dealership: the accuracy and defensibility of your warranty reimbursement rates.
AI Should Augment Human Expertise — Not Replace It
AI is a powerful tool — but like any tool, it must be used thoughtfully. In its current state, AI excels at augmenting human intelligence by surfacing patterns, identifying trends, and automating repetitive tasks. But it is not a substitute for expert human judgment, especially in complex, highly specialized domains like warranty reimbursement.
Yet we are now seeing vendors deploy AI in areas where it simply shouldn’t be used to “cover up” inherent deficiencies in their software. One clear example: using AI to overcome poor op code usage in dealer management system (DMS) data. The truth is the necessary information to overcome op code issues is already embedded in each individual job. If your software isn’t sophisticated enough to properly extract and analyze this data, slapping on an AI overlay is not innovation — it’s a shortcut, or worse, a band-aid on a bullet wound.
We Know, Because We’ve Been Doing It the Right Way
At Armatus Dealer Uplift, we understand the proper role of AI in this space — because we’ve been using it responsibly for more than five years. Our AI tools are designed to assist our expert team, not replace them. For example, we use AI to read and parse repair orders more efficiently, allowing our experts to make faster, more informed decisions based on better data. We don’t need AI to try and unwind the tangled web of poor op code usage; our software simply looks at every job on every RO and has no need to rely on the op code (or AI) to determine what jobs are qualifying or non-qualifying in your warranty reimbursement submission.
But make no mistake — there are no shortcuts to quality in Retail Warranty Reimbursement. Every submission requires careful review, validation, and human expertise to ensure accuracy, defensibility, and compliance with state laws. If a vendor is promising lightning-fast turnarounds and more accurate reports today thanks to “AI,” the natural question to ask is: why weren’t their reports accurate in the first place? And is increased speed just from using AI really the right priority if it comes at the cost of quality? In warranty reimbursement, lack of quality = lost profit.
“New” Tech? Not Really
Many of the buzzworthy features being touted today — job classification, AI-enhanced data processing, rapid turnaround — are not new. These have been part of the landscape for close to a decade. What matters is not the marketing spin, but how thoughtfully and rigorously the technology is implemented to drive better outcomes for dealers.
Leaving Your Warranty Rates Up to Chance? Think Again.
If you’re comfortable leaving your warranty rates — and the long-term financial performance of your fixed ops department — to chance, you can certainly lean on AI to be your savior. But if you want to understand the limitations of AI in this space, just ask a large language model about its accuracy in highly specialized domains like automotive data analytics. You’ll likely hear a range of 50-85% — hardly the level of precision you want governing your warranty submissions. With a lot of money at stake, 50-85% is simply not “good enough.”
The Bottom Line
AI is an incredibly valuable tool when used properly — to supplement advanced technology and expert human analysis, not to compensate for system shortcomings. At Armatus Dealer Uplift, that has always been our approach. If you’re seeing vendors promise the moon with shiny new AI solutions, ask the hard questions. Because when it comes to your warranty rates, there are no shortcuts to quality, speed, efficiency and achieving the highest rate.
Author Bio: Jordan Jankowski is the Chief Operating Officer at Armatus Dealer Uplift. He has played a key role in consulting on 21 warranty reimbursement laws across the country and is widely considered a subject matter expert in this highly technical arena. Jordan manages a team of over 60 people, who produces thousands of retail warranty reimbursement submissions each year.
