I'm sure that there are tools to automate some of the work, but my understanding is that in most cases modelling artists want some kind of control over the generated LODs to ensure they don't look like shit. Removing vertices on a 3d textured object is not nearly as simple as scaling a 2d picture as far as I understand it. You need to avoid mismapped textures, clipping vertices, the wrong missing details causing obvious pop-in, etc. A triangle in one place can be redundant but another triangle elsewhere may be a critical detail whose removal will be obviously missing from a distance (for example if you model the white house, you really want to keep the small flagpole up top at ALL levels of detail, but automated systems might remove it).

TBF part of the problem is that modern graphics cards mostly can shrug off insane amounts of geometry and badly optimized models, so management must have heard "high prio but not strictly blocking for release" and said "put it in the backlog" (aka "lmao whatever nerd I don't care then, please focus on Marketing's feature list happy please and thank you").