CDK Global, the company that handles sales for thousands of car dealers in the US, says it has restored systems for a small group of dealers after it was hacked last week in what became described as a 'ransom campaign'. But many dealers still remain offline as the end of the month approaches, with no promises about when their systems will be up and running again.
“We have successfully brought a small initial test group of dealers live on the Dealer Management System (DMS), and once validation is complete, we will begin phasing in additional dealers,” the company said in a statement to CBS late Wednesday MoneyWatch. A CDK spokesperson did not indicate how many dealers were part of the first test group whose systems were restored.
“We are also actively working to bring additional applications live – including our Customer Relationship Management (CRM) and service solutions – and our customer service channels,” the company said, adding that it appreciates the urgency of the situation for its customers.
According to Bloomberg reportCDK plans to pay a ransom to the group behind the hack, believed to be called BlackSuit, to end the outage. CDK has not indicated whether or not it has made a payment to the group.
Geoffrey Pohanka, president of Capitol Heights, Maryland-based Pohanka Automotive Group, told CBS MoneyWatch that his company is not among the small number of dealerships with CDK systems that were back up and running on Thursday.
Instead, the tools his dealers use to make sales, track inventory and manage customer relationships have been out of action for more than a week. That throws a spanner in the works for his company that sells and repairs cars and car parts.
“We're still working through the workarounds, using a paper-based system. The problem is we can't load that data back into the system,” Pohanka said. “We can justify the work we've done in our general ledger from a financial statement standpoint, but it's very difficult to get all that data back into the system so you can access it later.”
CDK had previously told dealers do not expect all their systems to be operational by the end of June.
“We feel it is important to state that we do not believe we can get all dealers live before June 30,” CDK Global said in a recorded message on a helpline and in a memo sent to dealers on Tuesday.
Pohanka hopes to have its dealer management system up and running by the first week of July.
“We have to close with manufacturers every month and it will be difficult if it is not operational within the first week of the month,” he said. “But we will figure it out, we will have to do it, we have no choice.”
On Wednesday, data analytics firm JD Power published said it forecast that new vehicle sales would fall 8.2% in June compared to the same month a year earlier. The expected decline is not a reflection of consumer demand, but rather the impact of the CDK outage on customers. According to J.D. Power, sales that would normally take place this month are expected to take place in July.
“Due to the disruption to dealer software systems, June sales will not reflect actual consumer demand for new vehicles,” Thomas King, president of data and analytics at JD Power, said in a statement. “Instead, a significant number of sales that would have occurred in June are now likely to occur in July.”
