Cyberattack on CDK Global Disrupts Car Dealership Sales Across the U.S. – WSJ
A massive cyber incident at CDK Global has plunged thousands of auto dealerships across the US and Canada into disarray. This outage, now in its third day, has brought sales operations to a near standstill during a peak car-buying period.
CDK Global’s Impact on Auto Dealerships
CDK Global, a crucial software provider for 15,000 dealerships, manages everything from records to scheduling. The recent cyber incident has forced the company to shut down most of its systems, leaving dealerships unable to access vital customer and sales data.
On Wednesday, CDK spokesperson Lisa Finney confirmed the company’s efforts to investigate the incident. “Out of an abundance of caution and concern for our customers, we have shut down most of our systems and are working diligently to get everything up and running as quickly as possible,” she stated.
While CDK managed to restore most critical systems by Wednesday evening, another incident occurred the next morning, causing further disruption.
Extended Outage and Its Consequences
By Thursday afternoon, CDK had no new information on the outage. The company warned that systems might remain down for several more days, impacting dealership operations significantly. North Carolina-based Sonic Automotive described the event as a “cybersecurity incident.”
CDK Global’s services are vital for dealerships, handling everything from sales records to customer appointments. Without access to these systems, dealerships are struggling to manage daily operations, risking lost sales and customer dissatisfaction.
Why Timing is Critical
The timing of this outage is particularly problematic, coinciding with the start of summer—a crucial season for car sales. CDK highlighted the importance of this period in a recent blog post, emphasizing increased sales opportunities post-Memorial Day.
Sonic Automotive, in a Securities and Exchange Commission filing, noted that the outage disrupted key operations such as sales, inventory, and customer relationship management. While the financial impact is still undetermined, the operational strain is evident.
Adapting to the Crisis
Despite the challenges, some dealerships are finding ways to adapt. Jeff Ramsey from Ourisman Auto Group in Maryland acknowledged the significant hassle but noted that sales are still possible, albeit with difficulty. “Customers delayed in closing a sale could just find a dealer nearby not affected by these issues,” Ramsey said.
Brian Benstock, general manager of Paragon Honda and Paragon Acura in New York, mentioned that his team can hand-write buyer’s orders. However, the lack of access to pre-negotiated customer agreements complicates the process, especially with rebates and incentives involved.
Support from Automakers
Automakers like Kia, Toyota, Stellantis, and Ford are stepping up to help dealerships navigate this crisis. Ramsey noted their supportive efforts, while Ford provided alternative processes to maintain customer service. Ford emphasized that despite the CDK outage, their customers can still receive sales and service support through other channels.
This ongoing cyber incident underscores the vulnerability of relying heavily on centralized digital systems. As CDK Global works to resolve the issues, dealerships and automakers continue to adapt, striving to maintain service and sales during this critical period.
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