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Sales decline at Sonic Automotive after CDK cyberattack with significant impact

Sales decline at Sonic Automotive after CDK cyberattack with significant impact
Sales decline at Sonic Automotive after CDK cyberattack with significant impact

Diving certificate:

  • Sonic Automotive said car sales were down during a weeks-long outage following a Cyberattack on its software service providerCDK Global, and the incident is “more likely than not to have a significant impact” on financial performance, the company said in a statement on Friday. Filing with the Securities and Exchange Commission.
  • The dealership, a Fortune 500 company, expects a negative impact on its earnings in the second fiscal quarter due to a “slower rate of vehicle sales” after June 19, when CDK said it detected a cyberattack on its network. More than 15,000 dealerships across North America use CDK’s cloud-based services.
  • Sonic Automotive said basic functionality of CDK’s dealer management system has been restored, but other CDK systems and certain features remain offline. CDK has previously declined questions about the nature of the attack and was not immediately available for comment.

Diving insight:

CDK said last week that every customer would regain access to your dealer management system by July 4, although the private company has not provided a timeline for when it expects to bring other key services online.

Sonic Automotive said CDK’s customer relationship management platform and certain features of its dealer management system remained offline.

“In addition, some third-party applications that are normally accessible through the affected systems also remain offline. The timing of when full access to all affected systems will be restored remains unclear,” Sonic said in the filing.

CDK had previously stated that the recovery would be gradual, but warned that some integrations with original equipment manufacturers and third-party vendors could face delays.

Within days of the attack, Sonic joined four other major auto dealers, including Penske Automotive Group, AutoNation, Group 1 Automobile And Lithia Motorsby filing similarly worded disclosures with the SEC. Sonic is the only company in the group to have filed an update as of Monday.

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