Your car is selling your data

Car insurance rates may increase due to undisclosed driver behavior data collection and sale by automakers.

General Motors was penalized by the FTC with a five-year ban on selling customer driving data to third parties after it was revealed that the automaker collected extensive data on drivers, such as speeding habits and driving times, and sold it to data brokers like LexisNexis and Verisk. This data was used to create risk profiles for insurance companies, leading some drivers to report increased insurance rates. Many consumers were unaware their data was being collected, often consenting through connected services plans like OnStar, which activated features such as Smart Driver. In response to the FTC settlement, GM must simplify the process for drivers to disable location tracking and access or delete their collected data. A Mozilla Foundation study found that nearly all major automakers "have horrible privacy and security," collecting vast amounts of data across multiple overlapping policies without sufficient transparency. Consumer Reports corroborated this, noting that almost every automaker shares driver behavior data.

The automotive industry faces increasing scrutiny over its extensive data collection practices, as evidenced by the FTC's penalty against GM and studies by Mozilla and Consumer Reports highlighting widespread privacy concerns across automakers. While legislative efforts like the DRIVER Act aim to grant consumers more control, they are criticized for not fundamentally addressing the issue of excessive data collection. This suggests a potential market push for more transparent and privacy-respecting data handling in vehicles.

Automakers have strong financial incentives to continue collecting and monetizing driver data, creating a challenging landscape for privacy advocates and consumers seeking greater control. The demand for simpler, less data-intensive vehicles is growing, yet the industry's profitability is tied to data monetization, indicating a potential conflict between consumer desires and corporate business models that will likely shape future vehicle development and regulation.