5th April, 2023 ยท CEO Message

CEO Message No. 85

2 minutes to read

The risks of cyber security have moved to the forefront of Australian consciousness over the past year with large companies such as Optus, Medibank Private and Latitude Finance being successfully targeted by hackers.

Cyber security is now a global threat and businesses which fall victim face significant reputational risk as well as financial risk with the Federal Government’s decision to increase the penalties for businesses which allow hackers to get hold of customer data.

No businesses are spared from hackers, including franchised new car dealerships ranging from large multi-franchise groups to single franchise dealerships. All are at significant risk due to the large amount of data they collect and store, including customer particulars and financial information such as bank account details.

In the US, the DMS provider CDK Global has started undertaking an Annual Global State of Cybersecurity Report. In a survey, the most recent report found that 15% of all dealerships sustained a cyberattack in 2022 with some 85% of the incidents occurring due to phishing masked as legitimate emails resulting in data breaches, business interruptions and loss of income.

These reports underscore the importance of treating cyber security as a risk in your dealership and taking the important steps to mitigate the risk. Dealers have obligations to keep their customers information secure. They also have an expectation from franchisors to ensure the processes they have in place are best practice.

The AADA has elevated the wider issue of Data as one of our policy priorities. Data is an all-encompassing term which includes the work we are doing on repair and service information sharing, to what the future looks like in terms of Dealer access to vehicle-generated data. Ensuring Dealers are equipped to deal with the threats posed by cyber security is the most pressing current issue.

In the coming months AADA will be trying to tackle this issue of cyber security from a franchised new car Dealers perspective through commissioning some research and developing some guidance for the industry.