Massive computer outage at car dealerships could last for days, company says | CNN Business (2024)

Massive computer outage at car dealerships could last for days, company says | CNN Business (1)

Paragon Honda and Acura car dealership in the Queens borough of New York on July 15, 2021.

CNN

US and Canadian auto dealerships remained at a near-standstill on Thursday because of a second cyber incident at data provider CDK Global, whose software is used at 15,000 auto dealers – an outage that could last for days, perhaps eating into sales over the first official weekend of summer.

On Wednesday, CDK spokesperson Lisa Finney said in a statement shared with CNN: “We are actively investigating a cyber 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.”

Later that day the company announced that most of the critical computer systems were back online. But Thursday morning, the company sent dealerships another message indicating things had a taken a turn for the worse.

“Late in the evening of June 19, we experienced an additional cyber incident and proactively shut down most of our systems. In partnership with third party experts, we are assessing the impact and providing regular updates to our customers,” CDK said in a statement shared Thursday morning. “We remain vigilant in our efforts to reinstate our services and get our dealers back to business as usual as quickly as possible.”

The company later told dealers the systems could be down for several days, according to two sources briefed on the situation.

CDK operates numerous different products that car dealers use to handle things like keeping records of negotiated deals to scheduling and communicating about service. Not every dealer uses CDK’s products, and even those that do may not use them for everything, but the system shutdown has been a problem for many.

“We have customers coming in today who had deals saved in the system,” said Jeff Ramsey, an executive with Ourisman Auto Group, which is headquartered in Maryland.

To protect customer privacy, customers’ details aren’t written out on a piece of paper that’s just sitting on a desk anymore. Instead, information about deals and customer appointments is kept in a server that’s now impossible for his salespeople to access.

How this affects buying a car now

Ramsey said he understands, though, that CDK is doing what it feels it must to secure this sensitive data. But it’s a major hassle in the meantime and could cost his dealerships some business. Customers who are delayed in closing a sale at one of his dealerships could just find a dealer nearby that’s not having these issues and buy a new vehicle there, instead.

It’s car buying season, so it’s a real concern.

“We’re in the summer months,” he said. “This is where we need systems functioning.”

Ramsey and Brian Benstock, general manager of Paragon Honda and Paragon Acura in Long Island City, New York, both said they were continuing to do business and were selling cars in spite of the problems.

“My selling team can hand-write a buyer’s order,” said Benstock.

But salespeople could lack access to customer agreements that had been previously negotiated, making it harder to close those sales, dealers CNN spoke with said. There’s more than just the negotiated price of the car involved, since these agreements can involve rebates and incentives, some of which customers must show they’re qualified for.

Ramsey, whose company operates a number of dealerships, said automakers including Kia, Toyota and Stellantis, which makes Jeep and Dodge vehicles, have been very helpful with finding ways serve customers even with all technology issues.

Ford also said its dealerships involved in the CDK outage have alternate ways to take care of customers.

“Although there is an industry-wide system outage for some dealers who use CDK, Ford and Lincoln customers are able to receive sales and service support due to alternative processes available to our dealers. While a customer’s local dealer remains the best place for information about their sales and service needs, they can always contact the Ford Customer Relationship Center at 1-800-392-3673,” Ford said in a statement shared with CNN.

Not just car sales, but parts and service can also be disrupted.

The bigger hassles will be for the dealership’s accountants and businesspeople, Benstock said. Plenty of his employees have been in this business since before it became networked and computer dependent, he said, but it’s still a problem and he’s still worried about customer data.

Massive computer outage at car dealerships could last for days, company says | CNN Business (2024)

FAQs

Massive computer outage at car dealerships could last for days, company says | CNN Business? ›

US and Canadian auto dealerships remained at a near-standstill on Thursday because of a second cyber incident at data provider CDK Global

CDK Global
CDK Global Inc. is an American multinational corporation based in Austin, Texas, providing data and technology to the automotive, heavy truck, recreation, and heavy equipment industries. CDK Global, Inc. Austin, Texas, U.S.
https://en.wikipedia.org › wiki › CDK_Global
, whose software is used at 15,000 auto dealers – an outage that could last for days, perhaps eating into sales over the first official weekend of summer.

What does CDK do for car dealerships? ›

CDK operates different software products car dealers use to handle workflow such as keeping records of negotiated deals, to scheduling and communicating about service. Not every dealer uses CDK's products, and those that do may not use CDK for every dealership task, but the system shutdown has been a problem for many.

How many dealerships use CDK? ›

Trusted by nearly 15,000 dealer locations, CDK Global connects you to world-class dealership software solutions that work together to help you reach your potential.

Why is CDK down? ›

CDK Global was hit with a ransomware attack affecting thousands of U.S. auto dealerships. Keep reading to learn more about this attack and how it affected the industry. Ransomware attacks are not a new phenomenon and are continuing to have a widespread impact across multiple industry sectors.

Who uses CDK? ›

Customers of CDK Global
CustomersEmployee RangeCountry
Martin Deerline500 - 999Canada
Mississippi Ag250 - 499United States
Delta Power Equipment250 - 499Canada
Jesco250 - 499United States
6 more rows

How does CDK work? ›

CDK allows you to extend existing components to create custom components that meet your organization's security, compliance, and governance requirements. These components can be easily shared around your organization, enabling you to bootstrap new projects with best practices by default rapidly.

Who owns CDK software? ›

On April 7, 2022, CDK Global agreed to be acquired by Brookfield Business Partners and institutional partners for a total enterprise value of $8.3 billion.

What company owns the most dealerships? ›

In comparison, Lithia Motors has continuously expanded its dealership network without falter since 2014, acquiring 32 locations in 2022 alone. With over 290 storefronts, it now claims to have surpassed AutoNation in size, making it the biggest dealer group in the U.S.

Who bought out CDK? ›

Last April it was announced that CDK Global, Inc., was being acquired by Brookfield Business Partners for $8.3 billion. Under merger agreement terms, CDK shareholders were said to receive $54.87 per share in cash upon completion of the transaction.

Who is the largest auto distributor? ›

Bosch continues to be the world's largest automotive supplier, and Denso remains the world's second largest. Next in line are ZF, Hyundai Mobis, and Magna. On the other hand, CATL moved up to sixth place in FY2022 due to increased battery demand.

Does ADP own CDK? ›

As part of the spinoff, ADP stockholders received one share of CDK Global for every three shares of ADP common stock they held on the record date of September 24, 2014. CDK Global is now an independent, publicly-traded company in which ADP retains no ownership interest.

What company spun off CDK Global? ›

Effective October 1st, Automatic Data (ADP) completed a spinoff of CDK Global (CDK).

How many people work for CDK? ›

The number of employees of the company Cdk Global headquartered in the United States decreased to 6.5 thousand persons since the previous year.

How many dealers use CDK? ›

CDK says its software, which specializes in a dealer management system that manages the entire car dealership for those who use CDK software, is used by approximately 15,000 dealers.

What is a CDK computer system? ›

CDK Global is an auto dealer management software designed to help businesses in the automotive industry manage dealership, sales, inventory, leasing, and compliance-related operations.

What are the pros of CDK? ›

Advantages of AWS CDK:
  • Familiar Programming Languages: ...
  • Abstraction of Cloud Resources: ...
  • Code Reusability: ...
  • Integration with IDEs: ...
  • Automatic Generation of CloudFormation Templates: ...
  • Community Contributions:
Dec 29, 2023

What is CDK experience in automotive? ›

Simply put, the CDK Dealership Xperience is a new category of software that unifies workflows across the dealership so that you're running your operations better while also delivering optimal customer experiences. Learn about the Dealership Xperience, its benefits and how you can use it for your auto dealership.

What is the CDK system? ›

CDK Global is dealer management system (DMS) that provides insights and tools to manage dealership businesses. The system offers a unified interface for quickly accessing relevant information, such as current inventory levels, estimates and actual results.

What does a dealership management system do? ›

A DMS is a software platform that dealerships and service shops use to manage their day-to-day operations. These systems provide tools for different areas of your dealership. More commonly this includes tools for finance, sales, vehicle inventory, customer information management and credit reports.

What does CKD vehicles stand for? ›

CKD stands for Completely Knocked Down cars. These are vehicles that are shipped in parts and assembled at the dealership or factory. Conversely, CBU stands for Completely Built Units which are vehicles that are shipped in one piece and do not need to be assembled.

References

Top Articles
Latest Posts
Recommended Articles
Article information

Author: Sen. Ignacio Ratke

Last Updated:

Views: 5631

Rating: 4.6 / 5 (76 voted)

Reviews: 91% of readers found this page helpful

Author information

Name: Sen. Ignacio Ratke

Birthday: 1999-05-27

Address: Apt. 171 8116 Bailey Via, Roberthaven, GA 58289

Phone: +2585395768220

Job: Lead Liaison

Hobby: Lockpicking, LARPing, Lego building, Lapidary, Macrame, Book restoration, Bodybuilding

Introduction: My name is Sen. Ignacio Ratke, I am a adventurous, zealous, outstanding, agreeable, precious, excited, gifted person who loves writing and wants to share my knowledge and understanding with you.