The First 60 Days: Why Every Dealership Acquisition Should Begin with a Retail Warranty Reimbursement Review

by Jordan Jankowski, Armatus COO

When organizations evaluate a dealership acquisition, the due diligence checklist is extensive. Buyers scrutinize financial statements, manufacturer financial composites, customer retention metrics, inventory, real estate, employee contracts, litigation exposure, environmental issues, facility image requirements, and blue sky value. Every line item is examined for hidden risk or hidden value.

Yet one of the most overlooked opportunities often receives little or no attention: retail warranty reimbursement. As dealership acquisition activity accelerates across the nation, overlooking this area can mean leaving hundreds of thousands – or even millions – of dollars in future fixed operations revenue unrealized.

Retail warranty reimbursement should no longer be viewed as a routine compliance function. For acquiring dealers, it should become one of the highest-priority operational reviews completed during the first 60 days of ownership.

A Historic Buy-Sell Market Creates New Opportunities

The dealership acquisition market remains remarkably active. According to the latest Haig Report, an estimated 139 dealership rooftops changed hands during the first quarter of 2026, representing a 39% increase over the same period in 2025 and nearly 30% more than pre-pandemic 2019 levels. Even more telling, 96% of acquisitions were completed by private buyers, while multi-dealership transactions increased 54% year over year, illustrating continued confidence...

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OEMs Turn to AI in Vehicle Manufacturing: Why Retail Warranty Reimbursement Has Never Been More Important

by Sean Reyes, Armatus Chief Marketing Officer

For decades, vehicle warranty work has been viewed as an unavoidable cost of doing business. Manufacturers designed and built vehicles, dealerships repaired them, and warranty reimbursement served as the financial bridge between the two. But that equation is changing.

According to a recent analysis by McKinsey & Company, global automotive warranty costs have nearly doubled since 2012, reaching approximately $58 billion in 2024 – roughly 2.2% of industry sales. For some automakers, warranty expenses now exceed 4% of annual revenue, rivaling their investment in research and development.

Faced with mounting financial pressure, OEMs are aggressively investing in artificial intelligence to identify quality issues sooner, detect failure patterns before they spread across vehicle populations, and shorten the time between identifying a defect and deploying a remedy. McKinsey reports that manufacturers expect AI-enabled quality systems to reduce warranty costs by 5% to 10% or more through earlier detection, better root-cause analysis, and more targeted corrective actions.

These investments will undoubtedly improve vehicle quality over time. But dealerships should not assume that AI will dramatically reduce warranty work anytime soon. In fact, the opposite may be...

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