The CDK Global Outage: What It Means for Your Business and How to Protect Yourself

Imagine waking up to find your business operations at a standstill—phones silent, systems offline, and employees uncertain about their next steps. This nightmare became a reality for thousands of U.S. auto dealerships during the recent CDK Global ransomware attack. As cyber threats continue to evolve, even the most trusted vendors can fall victim, causing widespread disruption across entire industries. But how did this happen, and more importantly, how can you protect your business from a similar fate? Keep reading to uncover the details of this attack and learn how Lockwell can shield your business from cyber disasters.

How Did the CDK Attack Happen?

Ransomware attacks aren’t new and continue to have a widespread impact across multiple industries. A ransomware attack can target a specific individual victim, though threat actors are increasingly using techniques where a single vendor is attacked but thousands of its users are impacted.

That's the case with the CDK Global cyberattack, first reported on June 18, 2024. In this incident, CDK Global was infected with ransomware, taking many of its core systems offline. As CDK Global is a trusted provider of software services to many organizations in the automotive industry, the ransomware impact was widespread.

Ransomware can be deployed into a victim's environment in many different ways. One of the most common is some form of phishing attack where administrative credentials are obtained. Social engineering is also an extremely common ransomware attack method, which can also be part of the phishing attack. Another potential cause could be a vulnerability in the software stack used by CDK Global.

Who Was Affected?

The CDK Global cyberattack impacted a wide range of entities in the automotive retail industry. Among them are the following groups:

• Car Dealerships: Approximately 15,000 auto dealer locations across North America were affected, including both the U.S. and Canada. 

• Automakers: Various automakers acknowledged the impact on their dealers' operations, including BMW, Nissan, and Honda.

• Customers: Car buyers faced delays and potential issues with transactions due to dealerships having to resort to manual processes. Some dealers and customers also reported attempted phishing scams from hackers aiming to capitalize on the ransomware outage.

• CDK Global: The company had to shut down most of its systems and initiate a lengthy restoration process.

What is the Impact of This Attack?

The impact of the CDK Global ransomware attack is extensive as it caused widespread disruption across the automotive sector in North America.

• CDK Global System Shutdown: CDK Global shut down most of its programs, including IT systems, phones, and applications.

• Widespread Dealership Disruption: Approximately 15,000 auto dealer locations across North America were affected. Operational impacts included an inability to access dealer management systems, disruptions in tracking and ordering car parts, difficulties in conducting new sales and offering financing, challenges in scheduling service appointments, and managing inventory. Some dealerships resorted to manual processes, using paper, while others sent employees home.

• Financial Impact: The attack led to disruptions in payroll processing for dealership employees and additional costs for implementing temporary manual processes. Some dealerships likely lost sales as they were unable to complete transactions.

• Customer Experience Impact: Automotive customers were impacted with delays when trying to purchase vehicles and when scheduling and managing service appointments.

• Data Security Concerns: The ransomware group’s access to sensitive customer and business data is a major concern.

• Industry-Wide Impact: Automakers were unable to track sales and inventory through their dealer networks.

Lessons Learned 

There are several critical lessons that organizations can learn from the CDK Global attack:

Develop Contingency Plans: Dealers struggled for days with little to no active guidance on what to do. It is crucial for organizations to have robust business continuity plans in place to maintain operations during system outages. This includes having operational playbooks that incorporate manual processes as backups when digital systems are unavailable.

Plan for Incident Response: The inability to respond quickly and effectively to the ransomware attack amplified the impact. Organizations must develop and regularly update an incident response plan, including conducting regular "fire drills" and tabletop exercises to prepare staff and management for potential cyber incidents.

Prioritize Data Protection: Attackers often seek out personally identifiable information and payment information. Organizations need to implement strong data protection measures and regularly assess and update their data security protocols.

Double Down on Ransomware Protection: Organizations need to emphasize and reexamine their ransomware protection strategies. There are multiple steps that organizations can and should consider to prevent ransomware exploitation.

Improve Communication Strategies: CDK Global did not initially have a singular location where it kept its users updated on the status of the attack and recovery effort. It is a good best practice to maintain clear and consistent communication with staff and customers during a crisis. It is also critical to unify messaging about what is going on after a cybersecurity incident to reassure customers about data security and service continuity.

Lockwell Solutions

At Lockwell, we understand the immense pressure small businesses face in securing their operations against cyber threats. Here’s how our solutions can help businesses safeguard themselves:

Incident Response Preparedness: Lockwell’s Automated Security Operations Center (A-SOC) provides real-time threat detection and response without the need for dedicated in-house security teams. This ensures that businesses can respond quickly and effectively to cyber incidents, minimizing impact.

Data Protection Measures: Lockwell’s multi-layered approach integrates account security, device security, network security, and threat intelligence to protect sensitive data. Our platform regularly assesses and updates data security protocols to keep your business safe.

Ransomware Protection Strategies: Lockwell leverages real-time threat intelligence to stay ahead of potential threats. Our system continuously updates with the latest threat data, enabling it to recognize and block new ransomware strains as they emerge.

Since phishing is a common vector for ransomware attacks, Lockwell’s platform includes robust anti-phishing tools. These tools analyze incoming emails for suspicious content and links, preventing employees from inadvertently downloading ransomware.

Effective Communication Tools: Lockwell’s platform includes features for centralized management and reporting, helping businesses maintain clear and consistent communication with staff and customers during a crisis. This helps reassure customers about data security and service continuity.

Conclusion

The CDK Global ransomware attack underscores the importance of robust cybersecurity measures for businesses of all sizes. Lockwell is committed to making advanced cybersecurity accessible and affordable, providing small businesses with the tools they need to protect against cyber threats and ensure business continuity. By leveraging Lockwell’s innovative solutions, small businesses can not only safeguard their operations but also contribute to a more secure digital ecosystem.

Lock up. Lockwell.