CDK Global shuts down car dealership software following cyberattack

A top software company that provides software to U.S. car dealerships has closed down a majority of its system “out of an abundance of caution” following an attack by hackers.

Bailey Schulz

A cyber attack on software provider CDK Global upended operations at car dealerships across the U.S. on Wednesday.

CDK spokesperson Lisa Finney said the company closed down a majority of its software “out of an abundance of caution” for customers. On midday on Wednesday, it returned to its document management system and its digital retailing solutions.

“We are continuing to conduct extensive tests on all other applications, and we will provide updates as we bring those applications back online,” Finney declared in an email statement.

Finney did not reply to questions about the number of dealerships were affected. However, CDK’s website claims that it works with over 15,000 retail outlets all across North America.

What exactly is CDK Global do?

One of the most prominent suppliers of cloud-based software to dealers across the country CDK’s software assists dealerships in managing the acquisition of vehicles including sales, financing as well as repairs and maintenance. The website of the company states that it provides the ” three-tiered cybersecurity strategy to prevent, protect and respond to cyberattacks.”

Why are dealerships of cars targeted by cyberattacks?

The incident is a result of an attack on the cyber security of Findlay Automotive Group last week. The automotive company that operates across five states – claimed the attack limited its capacity to sell and provide service, as per reports from the Las Vegas Review-Journal.

An report for 2023 from CDK reports that cybercriminals pose increasing their threat to dealers in the automotive industry and car dealerships, having 17% out of the 175 dealers having suffered a cyberattack or incident in the last year, compared to 15% the year before. Of these dealers who were surveyed, 46% reported that the cyberattack caused an adverse operational or financial impact.

Dealerships have become a tempting target due to the huge quantities of sensitive customer data they store. From credit applications to customer financial information, dealerships hold a “treasure of information” to hackers, according to a 2023 article by insurance firm Zurich North America.

“In addition, dealership systems are often interconnected to external interfaces and portals, such as external service providers,” the report says. Furthermore, many dealers “lack basic cyber security protections.”