US new-vehicle sales growth slows after CDK cyberattack

(Reuters) – Top U.S. automakers posted slower sales growth for the second quarter as a cyberattack at software systems provider CDK hit operations at several dealerships during the crucial selling period of late June.

General Motors reported a 0.6% rise in new-vehicle sales, compared with a jump of 19% last year, and said some sales would shift to the current quarter due to the hack.

Toyota Motor North America’s sales rose roughly 9%, much lower than last year’s jump of about 20%.

Market research firm Cox Automotive estimates overall U.S. new-vehicle sales volume in the second quarter likely grew 1% to nearly 4.2 million units. That compares with a year-on-year surge of about 16% in 2023.

CDK said on Tuesday that it was “ahead of the anticipated schedule,” and substantially all dealer connections were live again on the dealer management system.

“The CDK cyber attack has thrown a monkey wrench into sales during the second half of June, affecting what is arguably one of the most lucrative and busiest times of the month and quarter for dealerships,” said Jessica Caldwell, head of insights at Edmunds.

The CDK outage was the latest hiccup for automakers in the United States, as more than 15,000 retail locations were relying on the retail technology provider for their dealer management system.

Analysts, however, expect vehicle retailers and automakers to recoup most of the lost sales in July.

Hyundai, which flagged an impact to dealers from the CDK outage, posted a nearly 2% rise in second-quarter U.S. sales, compared with a 14% jump last year. Honda reported an about 2% jump in overall sales.

Overall, U.S. new vehicle sales in June stood at around 1.32 million units, which represent a seasonally adjusted annual rate of 15.29 million units, according to data released by Wards Intelligence on Tuesday.

Reuters Graphics
Reuters Graphics
Reuters Graphics
Reuters Graphics
“New vehicle affordability concerns remain prevalent and inventories are not expected to advance as strongly as they have done over the past 12 months,” said Chris Hopson, S&P Global Mobility analyst.
Electric-vehicle leader Tesla reported a smaller-than-expected 5% drop in deliveries in the second quarter, after price cuts and incentives helped stimulate demand.
Reporting by Nathan Gomes in Bengaluru, additional reporting by Pratyush Thakur; Editing by Shilpi Majumdar, Devika Syamnath and Maju Samuel