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A $250M vision to transform the auto retail landscape
Featuring Brian MacDonald, CEO of CDK Global
Welcome to another episode of the Car Dealership Guy Podcast.
In this episode, Brian MacDonald, CEO of CDK Global, sits down to share a bird’s eye view of the car market and offer his insights into everything from last year’s cyberattack to the F&I pain points dealers and customers face daily.
1. Reflecting on a challenging year.
Brian reflects on the impact of the cyberattack on CDK Global in 2024. He praises employees' resilience and their heroic efforts in restoring operations for dealers. Despite the stress on dealers and OEMs, he believes the crisis strengthened CDK’s company culture. Nevertheless, Brian is relieved to put the incident behind them.
2. Lessons from crisis leadership.
Brian says that his ability to navigate the fog of uncertainty during the cyberattack was helped significantly by his experience on the board of a Canadian oil company dealing with a similar event.
“It's sort of the fog of war experience and you've got to be comfortable just making decisions, communicating what you can.”
He urges other business leaders experiencing challenges to focus on transparent communication with their clients or customers.
3. 2025 outlook.
Brian forecasts changes in electrification strategies, noting a likely shift toward hybrid vehicles as manufacturers adjust to prioritize profitability.
“I think, to me, the fundamental help for the industry and the manufacturers is going to be a different path towards electrification. I don't know enough what that's going to look like. But there'll be…relief, if you will, for the manufacturers to get to a hybrid fleet or electrified fleet, however it may be.”
He is optimistic about 2025 and anticipates easing credit conditions, modest interest rate reductions, and continued industry resilience. Consolidation among dealers is also likely to increase, driven by the change in administration.
4. Strengthening dealer relationships.
CDK’s deep ties with dealers have been key to its success. Brian emphasizes the company’s focus on technology, noting it has set aside over $250 million in planned tech investments for 2025. These aim to enhance its product offerings and infrastructure while reinforcing dealer confidence and fostering long-term partnerships.
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5. AI-driven Innovation.
Brian is looking forward to the future of dealer tech in the era of artificial intelligence. He believes AI will be able to deliver more actionable insights, such as repair predictions and inventory optimization. Brian adds that AI shouldn’t treated as a standalone product but as an enhancement embedded across all solutions.
“We'll see as we go forward, that having the uniformity of the data in a single platform will really help drive the AI and machine learning innovation that we all expect to see.”
6. The role of data and platform evolution.
Brian says that unified data systems are critical for maximizing AI’s potential. Dealers need solutions that streamline data across platforms, supporting a more seamless integration of AI and machine learning. While bolt-on solutions remain relevant, Brian expects to see a gradual shift away from add-on software, making it easier for dealers to manage their toolkits.
“I do think that over time…dealers want to have less bolt-ons, less swivel chairs, less add-ons. And so there's certainly a trend towards that, which I think will continue.”
7. Enhancing customer and dealer experience.
Innovations like certification programs and advanced customer contact systems will help dealers stay ahead of the curve and develop their employees. These innovations will improve operational efficiency while empowering dealership staff with new skills and tools to navigate an increasingly complex automotive landscape.
8. Modernizing retail processes.
Dealers need to meet customers where they are—both online and offline. Offering tools for online credit applications, document submission and deal customization gives car buyers more freedom to pursue the car buying process in whatever way is most convenient for them. Most importantly, this omnichannel approach will reduce time spent in dealerships, a key driver of lower customer satisfaction scores.
9. The future of F&I.
Brian explains that consumers are becoming increasingly dissatisfied with F&I, a trend driven partly by vehicle affordability challenges.
“A little bit of the dissatisfaction comes back to affordability. If consumers are already struggling with the price of the vehicle, the increase in their payment from the last vehicle they had, then they have to go into the F&I office.”
He says that dealers are exploring innovations like centralized F&I models and leveraging Zoom to alleviate buyer frustrations. However, F&I’s role as a profit driver makes dealers cautious about disrupting established processes, which could slow progress in this area in the years ahead.
10. Industry innovation and trends.
Mobile service is gaining traction as some dealers successfully implement it with optimized routing and pricing strategies. However, not everyone is seeing a return on investment. Brian believes that data-driven approaches will be key to refining these services. He also highlights the growing role of online transactions in automotive retail and predicts steady growth in e-commerce adoption as the industry continues to evolve.
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