General Motors has been told that it will not be allowed to sell drivers' data to third parties for a period of five years. The ban affects several car brands.
General Motors has been banned from selling drivers' data for a period of five years.
The US consumer protection agency, the Federal Trade Commission (FTC), has found that the car company and its so-called OnStar service are breaking the law.
The FTC has determined that General Motors collected and sold sensitive data about drivers' locations and driving styles without asking for permission first. The data is now prohibited from being sold to consumer reporting agencies for five years.
– GM monitored and sold drivers' precise location data and driving style information. Sometimes as often as every three seconds.
"With this ban, the FTC is protecting Americans' privacy and protecting people from unfettered surveillance," said FTC Chair Lina M. Khan in a press release about the ban.
General Motors has already made changes to its data policies, according to a press release issued by the car company.
The group has discontinued its Smart Driver program and deregistered all customers in April 2024 after The New York Times reported that GM shared highly personal information with insurance companies.
General Motors also ended its partnership with analytics firms LexisNexis and Verisk last year. In September, it consolidated many of its privacy policies into a single, more manageable document.
But according to the FTC, GM never informed drivers about the types of data it was collecting about them. For example, General Motors didn't tell them that it was logging everything from hard braking to speeding violations.
All of this data could be sold on to, for example, analysis agencies, whose work insurance companies then used to raise prices.
The ban means that GM must now "obtain affirmative consent from all of its customers if the car company wants to collect, use or disclose certain types of data from vehicles, where such is possible."
General Motors must also give customers the option to disable data collection so that the car brand can see where individual cars are exactly at all times.
In addition, customers must be able to tell General Motors to delete data that has been collected at any time. Just as customers must always have access to the data about them. GM is now subject to the rule in all 50 states.
Automakers are under increased scrutiny from state and federal authorities when it comes to collecting data on drivers, which has already sparked at least one lawsuit.
Texas Attorney General Ken Paxton sued GM last August, alleging that the automaker tricked drivers into voluntarily handing over their data. Paxton has also sued Allstate Insurance for doing something similar.
Data collection and use is a central issue in the modern automotive industry, and the General Motors case shows that there is a need for increased focus on consumer protection and transparency in the handling of data.
