Car dealerships in North America continue to wrestle with major disruptions that started last week with cyberattacks on a software company used widely in the auto retail sales sector.
CDK Global, a company that provides software for thousands of auto dealers in the U.S. and Canada, was hit by back-to-back cyberattacks Wednesday. That led to an outage that has continued to impact operations.
For prospective car buyers, that's meant delays at dealerships or vehicle orders written up by hand. There's no immediate end in sight, with CDK saying it expects the restoration process to take 鈥渟everal days鈥 to complete.
On Monday, Group 1 Automotive Inc., a US$4 billion automotive retailer, said that it continued to use 鈥渁lternative processes鈥 to sell cars to its customers. Lithia Motors and AutoNation, two other dealership chains, also disclosed that they implemented workarounds to keep their operations going.
Here is what you need to know.
CDK Global is a major player in the auto sales industry. The company, based just outside of Chicago in Hoffman Estates, Illinois, provides software technology to dealers that helps with day-to-day operations 鈥 like facilitating vehicle sales, financing, insurance and repairs.
CDK serves more than 15,000 retail locations across North America, according to the company.
CDK experienced back-to-back cyberattacks on Wednesday. The company shut down all of its systems out of an abundance of caution, spokesperson Lisa Finney said last week.
鈥淲e have begun the restoration process," Finney said in an update over the weekend 鈥 noting that the company had launched an investigation into the 鈥渃yber incident鈥 with third-party experts and notified law enforcement.
鈥淏ased on the information we have at this time, we anticipate that the process will take several days to complete, and in the interim we are continuing to actively engage with our customers and provide them with alternate ways to conduct business,鈥 she added.
In messages to its customers, the company has also warned of 鈥渂ad actors鈥 posing as members or affiliates of CDK to try to obtain system access by contacting customers. It urged them to be cautious of any attempted phishing.
The incident bore all the hallmarks of a ransomware attack, in which targets are asked to pay a ransom to access encrypted files. But CDK declined to comment directly 鈥 neither confirming or denying if it had received a ransom demand.
Several major auto companies 鈥 including Stellantis, Ford and BMW 鈥 confirmed to The Associated Press last week that the CDK outage had impacted some of their dealers, but that sales operations continue.
In light of the ongoing situation, a spokesperson for Stellantis said Friday that many dealerships had switched to manual processes to serve customers. That includes writing up orders by hand.
A Ford spokesperson added that the outage may cause 鈥渟ome delays and inconveniences at some dealers and for some customers.鈥 However, many Ford and Lincoln customers are still getting sales and service support through alternative routes being used at dealerships.
Group 1 Automotive Inc., which owns 202 automotive dealerships, 264 franchises, and 42 collision centers in the U.S. and the United Kingdom, said Monday that the incident has disrupted its business applications and processes in its U.S. operations that rely on CDK鈥檚 dealers鈥 systems. The company said that it took measures to protect and isolate its systems from CDK鈥檚 platform.
All Group 1 U.S. dealerships will continue to conduct business using alternative processes until CDK鈥檚 dealers鈥 systems are available, the company said Monday. Group 1鈥檚 dealerships in the U.K. don't use CDK鈥檚 dealers鈥 systems and are not impacted by the incident.
In regulatory filings, Lithia Motors and AutoNation disclosed that last week's incident at CDK had disrupted their operations as well.
Lithia said it activated cyber incident response procedures, which included 鈥渟evering business service connections between the company鈥檚 systems and CDK鈥檚." AutoNation said it also took steps to protect its systems and data 鈥 adding that all of its locations remain open 鈥渁lbeit with lower productivity," as many are served manually or through alternative processes.
With many details of the cyberattacks still unclear, customer privacy is also at top of mind 鈥 especially with little known about what information may have been compromised this week.
In a statement last week, Mike Stanton, president and CEO of the National Automobile Dealers Association, said 鈥渄ealers are very committed to protecting their customer information鈥 and were seeking updates from CDK to determine the scope of impact 鈥渟o they can respond appropriately.鈥
Cybersecurity experts have stressed that consumers connected to CDK (or a CDK-affilated dealership) should assume that their data may have been breached. Those impacted should monitor their credit 鈥 or even consider freezing their credit as an added layer of defense 鈥 and be wary of any suspicious phishing messages.
HOW CAN I PROTECT MYSELF?
With many details of the cyberattacks still unclear, customer privacy is also at top of mind 鈥 especially with little known about what information may have been compromised this week.
If you've bought a car from a dealership that's used CDK software, cybersecurity security experts stress that it's important to assume your data may have been breached. That could potentially include 鈥減retty sensitive information,鈥 Steinhauer noted, like your social security number, employment history, income and current or former addresses.
Those impacted should monitor their credit 鈥 or even freeze their credit as an added layer of defense 鈥 and consider signing up for identify theft monitor insurance. You'll also want to be wary of any phishing attempts. It's best to make sure you have reliable contact information for a company by visiting their official website, for example, as scammers sometimes try to take advantage of news about data breaches to gain your trust through look-alike emails or phone calls.
Those are some best practices to keep in mind whether you're a victim of CDK's data breach or not, Steinhauer said. "Unfortunately, in this day and age, our data is a valuable target 鈥 and you have to make sure that you鈥檙e taking steps to protect it,鈥 he said.
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