Tekion, an innovative cloud-native platform for the retail automotive industry, has filed a federal antitrust lawsuit against CDK Global. The lawsuit accuses CDK of using unfair and anticompetitive tactics to maintain its dominant position in the dealer management system (DMS) market.
Tekion’s platform, launched in 2016, has revolutionized the DMS sector by connecting dealers, manufacturers, and consumers via cloud technology. The platform leverages big data, AI, and machine learning to streamline dealer operations.
Tekion argues that CDK‘s technology is outdated and accuses them of employing unfair business tactics to hold their customers hostage. The lawsuit aims to end CDK’s monopolistic control over dealership data, claiming it stifles competition and innovation. It also seeks an injunction for immediate data transfer and damages caused by CDK’s actions.
CDK has been accused of holding clients’ data hostage, blocking data transfer to other platforms, and even suing their customers. Furthermore, they’ve actively fought state-level regulation that would grant dealerships more control over their data, indicating a pattern of behavior that Tekion’s lawsuit seeks to address.
In October 2024, the company was ordered to hand over Asbury Automotive Group’s dealerships’ data to Tekion after refusing to transfer the data as requested. This order was granted after CDK initially attempted to sue Asbury.
In August 2024, the company was ordered to pay $100 million in a class action settlement. The settlement was reached after CDK was found guilty of conspiring to inflate DMS prices.
In July 2019, CDK fought to block Arizona’s DMS law, which would mandate that third parties have unrestricted access to dealership data.
The outcome of this lawsuit could have significant implications for the future of the automotive DMS market. If Tekion’s claims are substantiated, it could topple CDK’s monopoly, opening the door to more competition and innovation.
