The recent cyberattack on CDK Global has thrown the automotive industry into turmoil, leaving thousands of car dealerships across the U.S. struggling to operate. But what exactly is CDK Global, and what is the CDK car dealership program that is so critical to these businesses? This incident highlights the crucial role CDK plays in the daily operations of dealerships and raises important questions about the vulnerability of automotive software systems.
CDK Global is a major provider of technology solutions for automotive dealerships. At the heart of their offerings is the Dealer Management System (DMS), which can be considered the core of the “CDK car dealership program.” This comprehensive software suite is designed to manage virtually every aspect of a dealership’s operations. From sales and inventory tracking to service scheduling and customer relationship management (CRM), CDK’s DMS is the central nervous system for many dealerships. It integrates various essential functions, including managing vehicle inventory, processing sales transactions, scheduling service appointments, ordering parts, and maintaining customer records. The system also extends to Customer Relationship Management (CRM) and Service solutions, further streamlining interactions and operations.
The cyberattack, described by CDK as a “ransom event,” has severely disrupted these critical systems. Believed to be perpetrated by the BlackSuit ransomware group, the attack has forced dealerships to revert to manual, paper-based processes. This sudden shift has crippled their ability to efficiently conduct sales, manage inventory in real-time, and maintain seamless customer communication. As Geoffrey Pohanka, chairman of Pohanka Automotive Group, explained, dealerships are struggling with basic tasks, unable to load crucial data back into their systems, impacting everything from vehicle sales to parts and repair services.
The impact extends beyond daily operations. The outage occurred as dealerships were approaching the end of the month, a critical period for meeting sales targets and closing financial books. CDK has warned dealers that systems may not be fully restored before the end of June, exacerbating these challenges. J.D. Power forecasts a significant decrease in new vehicle retail sales for June, not due to lack of demand, but directly attributable to the CDK outage. These deferred sales are expected to shift into July, underscoring the immediate financial impact on dealerships.
While CDK has reported bringing a small test group of dealers back online with their DMS, a full restoration timeline remains uncertain. The company is actively working to restore CRM and Service solutions, acknowledging the urgency for its customers. However, for many dealerships, the disruption continues, forcing them to navigate essential business functions with outdated, manual methods. The incident serves as a stark reminder of the automotive industry’s reliance on interconnected software systems like CDK’s dealership program and the potential vulnerabilities within these digital infrastructures. As dealerships grapple with the ongoing fallout, the focus is not only on immediate recovery but also on long-term cybersecurity strategies to prevent future disruptions of this magnitude.
