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Welcome to Wednesday as we talk about  Volkswagen's significant investment in Rivian, the latest on the DMS Outage as well as how Target plans to empower its retail associates with a new GenAI-powered chatbot tool.

• As thousands of Dealers on the CDK platform are about to enter their second week of ongoing disruptions, the company has said there is no resolution expected before June 30. CEO Brian MacDonald defends the company's crisis response amid rising tensions and legal challenges.
  • CEO Brian MacDonald has begun speaking publicly by asserting the company's proactive engagement with dealers and commitment to support, 
  • In a June 25 note, CDK wrote, “We do feel it is important to share that we do not believe that we will be able to get all dealers live prior to June 30 but are making making significant progress.” The company emphasized transparency and urged dealers to use their available resource center while encouraging alternate planning for financial statement preparation
  • CDK currently faces two lawsuits seeking class-action status over compromised personal information.
    • One Filed by vehicle lessee Yuriy Loginov on June 22, alleging negligence, breach of contract, unjust enrichment, and breach of fiduciary duty, seeking class-action status for anyone in the U.S. whose private information was compromised.
    • The Second Lawsuit, filed by former dealership employee Eugene Buraga on June 24, alleges negligence, breach of confidence, breach of contract, and violations of the California Consumer Privacy Act, seeking class-action status for those whose information was exposed to unauthorized third parties.
      
      
• Volkswagen is set to invest up to $5 billion in Rivian, aiming to strengthen its software unit and support the EV startup's next generation of vehicles. 
  • VW will invest $2 billion in a joint software company using Rivian’s technology and purchase a $3 billion stake in Rivian over several years.
  • The investment provides Rivian with necessary capital to launch more affordable vehicles and improve its balance sheet.
  • Rivian shares rose about 30% in aftermarket trading following the announcement.
  • RJ Scaringe, Rivian's CEO, emphasized that the partnership lowers parts costs and spreads software development costs over a larger fleet.
  • VW aims to use Rivian's technology to address issues in its software unit, Cariad, which has faced quality problems.
  • Scaringe also emphasis that this is enough cash to get the company to the point where it is able to generate its own positive cash flow from sales
    
    
• Target plans to introduce a GenAI-powered chatbot tool, Store Companion, to all its nearly 2,000 U.S. stores by August, aiming to streamline daily tasks, coaching, and customer assistance for associates.
  • Store Companion will be available as an app on store team

Join Paul J Daly and Kyle Mountsier every morning for the Automotive State of the Union podcast as they connect the dots across car dealerships, retail trends, emerging tech like AI, and cultural shifts—bringing clarity, speed, and people-first insight to automotive leaders navigating a rapidly changing industry.

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