The Federal Trade Commission (FTC) has taken measures against General Motors and OnStar for allegedly selling location and driving data from millions of GM vehicle owners without proper consent. The data was recorded as frequently as every three seconds.
As a result, both companies face a five-year prohibition from selling location and driving behavior data. They are also required to transparently disclose any future data-sharing intentions and obtain appropriate consent.
General Motors sold location and driving data
It is established that General Motors and OnStar collected location and driving data from customers who opted for the OnStar connected vehicle service and the OnStar Smart Driver feature.
Data related to hard braking, speeding, and even late-night driving was sold to consumer reporting agencies, which utilized it to create profiles that allowed insurance companies to raise premiums or deny coverage altogether.
The contention lies in whether car buyers were fully aware that these practices were part of the agreement. GM and OnStar claim they were, while the FTC disputes this.
The Federal Trade Commission is taking action against General Motors (GM) and OnStar for allegations of collecting, using, and selling precise geolocation data and driving behavior information from millions of vehicles—data that can be used to determine insurance rates—without adequately informing consumers and acquiring their affirmative consent.
The FTC contends that GM, based in Michigan, employed a misleading enrollment strategy to convince consumers to register for its OnStar connected vehicle service and the OnStar Smart Driver feature, failing to make clear that they collected and sold precise geolocation data to third parties.
Five-year ban imposed
To resolve the issue, the FTC has proposed a five-year prohibition on the sale of this data, with subsequent measures to ensure that any future data sales are clearly disclosed to consumers and made with their explicit consent.
Under a proposed agreement settling the FTC’s allegations, General Motors LLC, General Motors Holdings LLC, and OnStar LLC, subsidiaries of General Motors Company, will be prohibited for five years from sharing consumers’ sensitive geolocation and driver behavior data with consumer reporting agencies. They will also be required to implement additional steps to provide consumers more transparency and choices regarding the collection, use, and sharing of their connected vehicle data.
By accepting this proposal, GM and OnStar can resolve the matter without incurring further penalties.
Strengthens the case for CarPlay 2
CarPlay 2 aims to enable Apple to oversee many car data systems, encompassing everything from infotainment to driving instruments like speedometers. However, the initiative has yet to see any automaker launch it despite two deadlines passing.
Industry speculation suggests that automakers are hesitant to relinquish such control, as doing so would limit their ability to collect data from their systems. With CarPlay 2, they would lose access to substantial data, which would instead be safeguarded by Apple’s stringent privacy policies.
Such actions further reinforce the argument for consumers to choose vehicles from manufacturers that support the new CarPlay standard.
Photo: General Motors
FTC: We use income-earning auto affiliate links. More.
