CDK eyes service restoration for all car dealers by Fourth of July

Dive Brief:

• The end of a disruptive period for car dealers across North America is in sight, and just in time for the busy Fourth of July holiday weekend. Every dealership that relies on CDK Global’s cloud-based system for critical services will regain access by late July 3 or early July 4, the company said Monday.
• CDK’s phased recovery process, which brought a small test group of dealers back online last week, has encountered delays. The company previously said it would restore critical services for all of its customers by June 30. 
• “We are continuing our phased approach to the restoration process and are rapidly bringing dealers live on the Dealer Management System,” Lisa Finney, senior manager of external communications at CDK, said Monday in an emailed statement. 

Dive Insight:

CDK discovered a cyberattack on June 19 and immediately shut down some of its systems, which has hampered its customers for almost two weeks. The outage began at the end of a quarter and could impact dealers anticipating elevated sales activity during a summer holiday weekend.

More than 15,000 dealerships rely on CDK’s cloud-based software for sales, customer relationship management, parts, inventory and accounting functions. CDK is critical in the automotive retail supply chain, transacting 2.6% of U.S. gross domestic product, according to the company.

While the restoration of CDK’s Dealer Management System is nearly complete, efforts to restore other services including the company’s customer relationship management platform are ongoing. The company has not provided a timeline for when it expects to bring other services online.

CDK restored its customer care channels and the company’s dealer resource portal will notify dealers when they can regain access to the Dealer Management System.

CDK is a private company but some of its customers, which are among the largest car dealers in North America, are publicly traded. In the wake of the attack, five major car dealers filed cyber incident disclosures with the Securities and Exchange Commission, warning investors of negative impacts on business operations.

Sonic Automotive and Penske Automotive Group filed with the SEC on June 21, and AutoNation, Group 1 Automotive and Lithia Motors filed June 24.

CDK has repeatedly declined to answer questions about its recovery timeline and the nature of the attack.