new york
CNN
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The CDK Global system outage affected nearly every aspect of the Mazda dealership where Ryan Callahan is general sales manager in Seekonk, Mass., and Mr. Callahan said it’s not something that can be easily fixed.
“The direct economic impact that that will have on us is going to take months, if not years, to correct,” Callahan said.
Car buyers and dealers are struggling with the shutdown of a retail software provider that has left roughly 15,000 auto dealerships across North America struggling to serve customers and having to scramble to find temporary analog solutions to operate.
CDK is working to restore its systems and says it expects to be back online within the next few days, but in the meantime, customers and dealership employees are experiencing long wait times and delays, missing out on opportunities to make profits and save money.
Tom McParland, owner of national car-buying services firm Automatic Consulting, said the outages were affecting his customers as they had fewer dealerships to choose from.
“This reduces their ability to close deals. It limits their clients’ leverage,” he said.
And some dealerships won’t apply factory discounts without CDK’s software, meaning customers could miss out on deals that could save them money.For customers looking to buy a car, McParland suggested casting a wide net and shopping outside of their local market to find the best price.
Midway Automotive uses CDK products to register vehicles with the Massachusetts Registry of Motor Vehicles.
Owner Michael Deveney said after Wednesday’s shutdown, the dealership sent customers to their local RMV office to have their cars registered in person after they made a purchase.
“That continued until Thursday, when (the RMV) started telling customers they weren’t accepting walk-ins,” he said. “Maybe they got inundated and started turning people away.”
One customer was growing increasingly upset because he couldn’t register his car, according to Devenney. “It can take three or four days to get an appointment, during which time you can’t drive your car,” he added.
Caitlin Salvato, who lives in Lynn, about 30 miles north, said she hasn’t been able to register her car since last Tuesday. Salvato works as a registrar for Pride Motor Group, registering vehicles for three dealerships.
“Today… I sent 21 registrations to be manually registered at the Massachusetts RMV,” she said, adding that the RMV will not accept transactions made by dealership employees: “Transactions must be submitted within designated hours (10 a.m. to 3 p.m.) and delivery people cannot wait for that.”
Callahan echoed those concerns: Normally, the CDK software allows dealers to register vehicles almost instantly, but now there are significant delays in the process.
“Our remote registration system is useless if it’s not communicating with CDK. We have to send registered runners to the DMV to compete in packs, and what used to take hours is now taking days,” Callahan said in an interview with CNN.
If a vehicle isn’t registered within seven days of purchase, the state will fine both the dealer and the customer.
The Massachusetts Department of Transportation, which oversees the state’s RMV, did not respond to CNN’s request for comment.
Service and sales go analog
Salespeople and service employees who spoke to CNN said it’s taking longer for people to buy a car because they’re now using pen and paper for the process, said Scott Campbell, a salesman at Capital City Buick GMC in Berlin, Vt. Campbell estimates that wait times have doubled to tripled.
Nicholas, a clerk in the parts department at a Porsche dealership in Los Angeles who declined to give his full name because he is unsure of his employer’s stance on speaking to the media, said that since the shutdowns, “I’ve been meticulously going through each invoice with a combination of pen, paper and Excel sheets.”
With many dealers using CDK products for inventory management, Nicholas said his department is forced to manually record stock parts, causing significant delays. “We don’t have a clear view of our inventory and we need to regularly check stock on our most commonly used parts,” he added.
But sometimes analog workarounds just aren’t enough.
Several buyers and repair customers told CNN they experienced lengthy delays.
Don Aycock told CNN that on Thursday, the day after CDK closed, he drove 90 miles round trip from his home to a car dealership in Clay County, Florida, to buy a new Buick. He was able to buy the car but was unable to sign the certificate of title, he told CNN.
“They called me today and said I can come in next Thursday to sign the ownership papers and get my permanent license plates,” he said, noting that it will be another long round trip drive.
Even though temperatures have been nearing 90 degrees in San Diego in recent days, Robbie Jacob and his wife tried to make an appointment at a Kia service center to fix their broken car’s air conditioning. Jacob said the center told them they couldn’t get an appointment and that walk-in visits had been suspended until next week because of the CDK cyberattack, so they couldn’t get their car fixed.
CDK Global is not the only management system used by dealers, and the string of cyber incidents plaguing the company have put competitors on edge.
Cox Automotive, which runs the DealerTrack and VinSolutions software systems for document management and customer service, told CNN that it temporarily suspended its systems integration with CDK after the outage “as a precautionary measure to prioritize the safety and security of our customers.”
“We are actively supporting our customers to ensure business continuity and have established a secure microsite that we are currently actively using to access support, guidance, workarounds and actions customers can take while the CDK system is unavailable,” the company said.
Tekion, another software company used by dealers, said it has “seen an increase in inquiries from dealers following the recent CDK incident.”
Other industry experts told CNN that switching from one system to another isn’t something dealers can do on a whim: Companies often sign multi-year contracts with software providers, and switching software also requires employee training, making it a lengthy process.
Meanwhile, Asbury Automotive Group Inc., one of the largest auto parts retailers and service providers in the U.S., warned investors on Monday that the CDK outage is hurting its business and it’s unclear when it will end. Rival Group 1 Automotive Inc. said CDK is confident the outage will be resolved within days, not weeks, but it’s unclear how much financial damage the company has suffered as a result.
