CDK Cybersecurity Incidents Cause Massive Chaos in the Car Industry

A popular automotive dealership software platform has recently become the target of a cyberattack, resulting in the solution going down for several days. Any business that has a solution it relies on can sympathize with the situation. After all, if you lose access to your critical business apps for several days, would your operations be able to recover?

Let’s dive into the situation.

CDK Global Outage Takes Down 15,000 Car Dealerships

Most businesses have specific solutions that they rely on to keep operations efficient, and car dealerships are no exception. While various platforms are available, moving from one to another can be costly and time-consuming, making a last-minute pivot next to impossible without a serious financial burden. It involves data migration, system implementation, inventory configuration, and user training.

These platforms are essential for operations, and each industry will utilize them differently. Some might use them for payroll, customer relationship management, inventory management, financial management, marketing, and so on. CDK Global is one of these solutions but for the automotive industry. 1 in 5 car dealerships in the US rely on it.

This outage started on Wednesday, June 19th, bringing down CDK’s systems for hours. On Thursday, yet another cybersecurity incident occurred. As of this writing, most of 15,000 dealerships had their systems restored, in line with a memo issued by CDK that the systems were unlikely to be restored before the end of June. 

Before the restoration, however, it was recommended that dealerships plan to adopt other software for their month-end financial closing processes in the short term.

As you can imagine, this was not an easy task for the car dealerships who rely on this software.

Dealerships Couldn’t Operate, and People Can't Register Cars

If you were a customer ready to pull the trigger on a new vehicle purchase, you’d be disappointed when only one of the five dealerships you visit can help. It’s also problematic if you cannot legally drive it. CDK Global’s software can help car dealerships register cars with the state. Still, depending on state laws, new customers must make an appointment with their local motor vehicle department to legally drive their car home.

Let’s be realistic: no one likes going to the Department of Motor Vehicles, regardless of how quickly or slowly the line moves. The fact that this outage forces customers to engage in this way is not good for CDK users.

Whose Fault is This, Really?

It’s easy to think that CDK Global is at fault, but it’s not necessarily the case (at least as of this writing). While it’s been severe enough to force most car dealerships to work on pen and paper, it’s important to note that cybersecurity issues are an inevitability.

There are ways to prepare for such attacks, but there is always a risk, however miniscule it might be. Even organizations that are well-prepared to handle cybersecurity threats can fall victim to them. What you can do, however, is judge how they respond to such attacks.

Here are some lessons that businesses can learn from this incident.

1. Cyberattacks can have a massive impact on your business and the lives of those you work with.
2. Cyberattacks can happen to literally any organization, large or small.
3. Proper preparation and proactive prevention can minimize the risk of a cyberattack and reduce the impact.
4. Communication during a cybersecurity incident is critical!

If your business relies on specific applications, then it’s time to consider what would happen if those applications were suddenly unavailable. It’s better to be prepared for the worst and never experience it than to be unprepared.

If cybersecurity concerns you, we’ve got your back. Virtual Business Solutions offers security solutions for your business. Call us at (504) 840-9800 ext. 105 to learn more.