The holding company world is getting squeezed from both ends right now. AI is automating the production work that justified a lot of the retainer, and clients are in-housing the strategy work they used to pay agencies to think through. That pressure is hitting the big holding companies hardest but the Tier 2 automotive shop is not immune. Most regional automotive agencies are still billing for media planning, creative adaptation, and campaign trafficking that platforms are increasingly doing automatically. The ones that survive are going to be the ones who can actually analyze regional market data and make a genuine strategic argument for how to allocate a co-op budget. The ones who survive on relationships and creative reuse are going to get replaced by a platform subscription.
May 10, 2026 - 10:39
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I sit on our DAA board and…
I sit on our DAA board and the conversation you are describing is happening but in slow motion. Everyone on the committee knows the current agency is not performing at the level it was five years ago. The reporting has gotten thinner, the strategic input has gotten more generic, and the creative is clearly being reused across markets. Nobody wants to say it out loud because the agency principal has been at every dealer event for twelve years and is personally liked. That relationship layer is exactly why the Tier 2 agency model is slow to collapse even when the value case is gone. The association structure rewards continuity over performance and the agency knows it. The dealers who are going to force this conversation are the ones writing the biggest co-op checks who finally do the math on what they are actually getting per dollar.
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