Experts in the industry are warning Canadian companies to assess their electronic vulnerabilities following an attack on car dealerships across North America to trade their paper-and-pencil digital systems.

CDK, an American company that provides software for sales and service management, was hit by consecutive cyberattacks last week. A company spokesperson said they shut down the service as a precautionary measure. Thousands of dealers were forced to find solutions, and experts are calling it a cautionary tale.

The company described the attack as a "ransomware incident," although it would not say whether any money was paid to regain control. The company stated that work was underway to obtain and activate backup services, but estimated that the process would take several days.

Tim Ross, CEO of the Canadian Automobile Dealers Association, told CTV News: "The system essentially logs all transactions at the dealership." "Selling a vehicle, trade-ins, service appointments, partial sales, quotes. We haven’t seen anything on this scale before in our industry.”

GP Kovac, a dealer principal at Gyro Mazda and Gyro Hyundai in Toronto, said, "It’s been really tough," noting that both of his dealerships use CDK software and had to revert to manually logging every transaction and booking.

He added, "It's just patience with the people on the front lines; they are really doing their best in a very tough time."

Steve Chipman, CEO of Birchwood Automotive Group in Manitoba, stated that 16 of his dealerships were affected.

Chipman said, "It’s frustrating." He mentioned, "It slows us down, and we’re going to have to re-enter everything,” referring to inputting every transaction into the system once it is restored.

But Chipman also hopes this event will make his business stronger and says it underscores the need to stay on top of cybersecurity.

He said, "Everyone complains, ‘Why do I need a long password, why does it take so long?’ It’s further proof that there are highly sophisticated criminals holding people for ransom.”

The number of cyberattacks has risen in recent years, with companies, hospitals, and municipalities all targeted by criminals typically aiming to steal data and hold it hostage until a ransom is paid.

Ritesh Kotak, an internet expert, said, "Cybersecurity is not a checkbox exercise." "It's not something you invest in once and that's it. These threats are constantly evolving, which is why it’s important for organizations to really think through where to invest to stay informed.”

Kotak stated that it’s not enough to just have cybersecurity measures in place. He recommends that companies have actionable plans in case they fall victim to an attack.

He asked, "Do you have the proper business continuity in place and how can you recover quickly?" "Otherwise, the consequences are you're going to be completely shut down and unable to do anything."

According to its website, CDK works with over 15,000 retail locations "and provides" a three-tier cybersecurity strategy to prevent, protect against, and respond to cyber attacks.