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HomeHome > Anti-monopoly

Automotive tech company CDK sued by rival Tekion over dealer systems

Post time：12-11 2024 Source：Reuters Author：Mike Scarcella
tags： CDK Tekion Antitrust
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Dec 10 (Reuters) - California-based automotive technology company Tekion has sued its larger competitor CDK Global, accusing it of monopolizing the market for dealership management systems.
 
Tekion's lawsuit, filed on Monday in federal court in San Francisco, said CDK was illegally trying to maintain its dominance by impeding dealers’ efforts to move to alternative management platforms, which led to dealers paying higher prices.
 
The lawsuit, opens new tab said CDK violated antitrust law by withholding or delaying dealers’ access to their operations data, making it harder for them to switch providers.
 
CDK did not immediately respond to a request for comment.
 
Tekion founder and chief executive Jay Vijayan in a statement on Tuesday said, “we have decided to stand up to CDK’s illegal practices to preserve fairness and competition in the automotive retail ecosystem.”
 
Dealers rely on management systems to run daily operations, keeping tabs on inventory, sales, service and parts, customer relationships and other areas.
 
Tekion provides a cloud-based system that allows dealers to use data analytics and artificial intelligence.
 
Tekion’s lawsuit marked an escalation of a feud over a major franchise dealership’s move in January to partner with Tekion for a pilot program.
 
In that case, a judge in Georgia in August ordered CDK to provide Tekion with data needed to conduct a four-dealer pilot for Asbury, which has 158 dealerships in 15 states.
 
“Tekion has suffered economic harm, including loss of revenue, loss of market share, and increased costs and expenses,” the lawsuit said.
 
Tekion is seeking unspecified monetary damages and an injunction that would require CDK to turn over dealer data within a set period.
 
CDK faces other antitrust claims. A U.S. judge in July said software vendors that create apps for dealer management systems can sue the company as a class for allegedly restricting access to data and causing them to pay hundreds of millions of dollars in overcharges.
 
In August, CDK said it would pay $100 million to settle a nationwide class action by retail auto dealerships claiming they overpaid for the company’s dealer management systems. CDK has denied the claims and did not admit wrongdoing.
 
The case is Tekion Corp v CDK Global LLC, U.S. District Court, Northern District of California, No. 3:24-cv-08879.
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