CDK Buys Digital Auto Retailing Company Roadster

In what’s billed as a potential game changer, automotive information technology provider CDK has acquired Roadster, a digital auto retailing company.

The $360 million acquisition is described by participants as significant for a couple of reasons.

First, they say, it will equip CDK dealer clients to compete with and possibly exceed the capabilities of digital-first used-vehicle chains, such as Carvana, that have expanded rapidly in recent years.

Second, the Roadster-CDK parties say the acquisition will provide an Amazon-like experience that allows CDK dealer clients to sell vehicles virtually end-to-end online. Most consumers today don’t opt for that, but digital auto retailing gives them the option to begin and end the buying process anywhere they choose, whether it is online, in-store or at home where they can take delivery of a vehicle and sign the paperwork at their kitchen tables.

With Roadster, “we will deliver that seamless, frictionless customer experience,” CDK Chief Operating Officer Joe Tauteges tells WardsAuto. “The market will see substantial changes.” 

Roadster’s functionality is embedded in dealer clients’ websites. The platform allows car shoppers to select inventory, arrange financing and otherwise transact a car deal as if they were at the dealership itself.

Roadster has about 2,000 clients worldwide, most in the U.S. and Canada, Andy Moss, the 8-year-old company’s founder and CEO, tells WardsAuto.

Tauteges says CDK plans to draw on its large client base to increase the number of dealers with Roadster on their websites. It plans to migrate the 1,000 dealers using CDK’s current digital auto-retailing platform, Connected Store, to the Roadster platform. 

CDK President and CEO Brian Krzanich says in a statement: “Consumers have shown they are increasingly more willing to purchase big-ticket items online, and this trend has quickly accelerated during the pandemic.

“To meet their expectations, the automotive industry requires integrations of the right technology, data and infrastructure to better connect its online and in-store experiences.”

He says Roadster’s consumer-focused approach and technology creates “a seamless omnichannel vehicle-buying process that puts dealers at the heart of the relationship.”

In recent years, CDK has developed or acquired digital auto-retailing technology with products such as Connected Store, Elead CRM, Digital Contracting and eSign. The acquisitions are part of a strategy to “remake CDK,” Tauteges says.

Moss adds: “Automotive retailing is extremely complex, and the best way to create a truly frictionless, end-to-end buying experience is to fully integrate our technology with the back-end systems that power dealership sales, finance and operations, regardless of provider.”

In the early days of digital auto retailing, some skeptical dealers worried it would hurt their profitability if customers were relying heavily on the internet to buy vehicles.

In retrospect, those fears were unfounded, Moss says. “Our dealers have seen better profitability in the front and back ends. The metrics are there to support it.”

He says he is proud that Roadster has “modernized the car-buying experience and reduced the time it takes to purchase a vehicle.”

Steve Finlay is a retired WardsAuto senior editor. He can be reached at [email protected].