Car dealerships across the United States and Canada are facing major challenges due to a cyberattack on CDK Global, a software provider for thousands of dealers. This attack has disrupted operations, leaving dealers scrambling to find alternative ways to conduct business.
One dealership in Phoenix has resorted to handwriting paper contracts and making credit assessments based on guesswork. In Alabama, a Jeep owner has been waiting for weeks for a replacement part, only to be left in the dark about its status due to the hack. In New Jersey, a family eagerly anticipating the delivery of their new Audi has been left disappointed as the dealership’s computer system remains down.
The impact of the cyberattack extends beyond individual dealerships to the broader auto retail industry, which generates over $1.2 trillion in sales annually in the U.S. CDK’s software, known as a dealership management system (DMS), is a critical tool for managing various aspects of dealers’ operations, from financing to inventory management.
The attack on CDK has also had repercussions in the stock market, with parent company Brookfield Business Partners LP seeing a significant drop in its share price. Other dealer groups, such as AutoNation Inc. and Group 1 Automotive Inc., have also experienced declines in their stock value.
Customers like Joshua Adams in Alabama and the Lanni family in New Jersey are feeling the effects of the cyberattack firsthand. Adams, who has been waiting for a warranty claim to be resolved on his Jeep, now faces additional expenses due to the delay in receiving the necessary part. The Lanni family, excited to receive their new Audi, has had to reinstall child seats in their old vehicle as they wait for the dealership’s computer system to come back online.
At a Nissan dealership in Phoenix, sales manager Alex Padron describes the situation as business being “almost at a standstill.” With over 50,000 customer records stored in CDK’s system, the dealership is struggling to conduct transactions as usual. Padron notes that only about half the usual number of deals are being processed, with more complex transactions being put on hold.
The cyberattack on CDK Global serves as a reminder of the vulnerability of businesses to digital threats and the importance of having contingency plans in place. As dealerships work to navigate this challenging situation, customers may experience delays and disruptions in their interactions with auto retailers.