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CDK Global Says It’s on Track to Get System Restored, Dealers Lose Nearly $1 Billion

by | July 2, 2024

The ongoing CDK Cyberattack crippled 15,000 dealerships across the country but there appears to be light at the end of the tunnel with CDK confirming that it will fully restore its services on July 4th.

Temecula Valley Toyota dealership

The June Cyberattack on CDK Globa’s software put nearly 15,000 dealerships in the dark.

The massive cyberattack that crippled CDK’s dealership software in June is proving to be a costly ordeal for 15,000 car dealerships across the country with many of them being forced to resort to other methods of accounting to keep operations moving. The attack crippled many aspects of CDK and its effects on the automotive industry have rapidly become a massive problem that can no longer be ignored.

However, there appears to finally be a light at the end of the tunnel with CDK confirming that it will have all 15,000 dealerships back online by July 4th as it slowly restores its online services after the massive hack attack.

CDK attack created a sinister domino effect

Dealer Service Department

The attack crippled multiple aspects of dealership operations which paralyzed their operations.

When CDK’s systems were attacked by an Eastern European hacking group in June, the software was taken down and it left 15,000 dealerships stuck in neutral. A core consequence of the cyberattack was that sales at the affected dealerships were effectively paralyzed with many of the impacted dealerships forced to use hand-and-paper accounting and other less efficient means of record keeping to try and maintain normal operations.

“We have customers coming in today who had deals saved in the system,” Jeff Ramsey, an executive with Ourisman Auto Group, which is headquartered in Maryland, told CNN. But because their information has been stored online the dealership may now have to start negotiating from scratch

In addition to impacting new and used vehicle sales, the CDK attack also exposed the all-encompassing nature of the firm’s software with the attack also impacting the operation of service departments and even payroll for employees with workers forced to keep written records of their work hours for their managers instead of having CDK log the times for them. As a result, the affected dealerships stand to potentially lose a combined $940 million with smaller firms potentially feeling the most pain since they often lack the resources a bigger mega-franchise might have to weather the storm.

“We can’t do much because we can’t access inventory or other records,” one service manager told Headlight.News, asking that his name and store not be mentioned because he was not authorized to speak on the record.

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A light at the end of the tunnel

CDK Logo

CDK says that it intends to fully restore its services for all affected dealerships by July 3-4.

CDK Global has been working on restoring operations and it appears that the firm has made enough progress to potentially get dealerships back online, with the company releasing a statement to Motor1 that said

“We are continuing our phased approach to the restoration process and are rapidly bringing dealers live on the Dealer Management System (DMS.) We anticipate all dealers connections will be live by late Wednesday, July 3 or early morning Thursday, July 4. Our Customer Care channels have also been restored and customers can call, chat, or submit eCases if they need assistance. We are also actively working on bringing other applications live, including our Customer Relationship Management (CRM), ONE_EIGHTY and Service solutions.”

While this is good news for the affected dealerships, there are still many questions that remain unanswered. The hacking group allegedly demanded $10 million in ransom to get the network restored and it’s not known if CDK Global paid any of that purported ransom to get its cloud-based systems back online. The original reactivation of its systems began on June 27th but only covered a small pool of dealerships and limited the software’s operation with the company using the limited rollout as a test bed to make sure its repairs were ready for the remainder of the dealerships affected.

Dealerships still dealing with the aftermath

Stan McNabb Chevy dealer

Dealerships will still have a big mess to clean up once CDK’s software becomes fully operational.

While the full restoration of CDK’s software this week will be a big step forward for the affected dealerships, they will still have a big mess on their hands to clean up even when the software is back up and running. Sales departments for example will have to re-negotiate many car deals from scratch since the attack likely wiped the stored deals out of the system’s internal memory with service departments also having to enter many repair jobs that were written by hand and paper into the system too which will take a considerable amount of time and effort to formally get things back on track.

Meanwhile, dealership payroll departments will also have plenty on their plate with these individuals having to enter hand-and-paper accounting of hours by dealership employees including hourly employees such as service and sales porters back into the software to help generate accurate pay for the time that these employees worked during the CDK outage.



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