CDK Global Takes Action to Repair Dealer Software Post-Hack, Yet Auto Sales Consequences Remain

Money | June 28, 2024, 12:33 a.m.

The cyberattack that paralyzed CDK Global dealerships in North America seems to be nearing resolution, but the damage is already significant. Lost sales and service revenue are a major concern for dealerships relying on CDK's systems. Despite efforts to restore services, a ransom demand from the attackers caused further setbacks. The staged rollout of CDK's Dealer Management System is a positive step, but public dealership groups like AutoNation and Group 1 Automotive anticipate negative impacts on second-quarter financial results. Automotive research firms project a decrease in June sales, with the potential for lost sales to be recovered in July. The cyberattack has disrupted one of the most lucrative periods for dealerships, affecting both dealers and automakers. Investors await Q2 earnings reports to assess the full impact on dealership sales and overall quarterly deliveries for major automakers.