GM Has Incurred an Additional $12.75 Million Due to Questionable Driver Data Sales

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      General Motors is still reeling from the 2024 New York Times exposé that criticized the company for secretly selling driver data. In January, an FTC ruling prohibited the automaker from selling location data for the next five years. The latest development: California’s Attorney General has secured a $12.75 million settlement regarding GM’s “illegal sale of hundreds of thousands of Californians’ location and driving information.”

      This ongoing GM data controversy has persisted for two, or approximately 11 years, depending on your perspective. GM began collecting driving data, including speed, braking, and locations, through OnStar in 2015, but reports of these practices have only emerged in the past 24 months. A statement from Consumer Rights Wiki provides clear context:

      “GM has shared driving data from over 14 million vehicles (including 1.8 million in Texas alone) with commercial data brokers like LexisNexis and Verisk, which analyze this information to create ‘driving scores’ sold to insurance companies. These scores have allegedly resulted in higher insurance premiums and coverage denials for consumers unaware that their data was being collected and sold.”

      The wiki also points out a concerning detail: GM reportedly provided customer location data to law enforcement using simple subpoenas instead of requiring warrants, contradicting the company’s public privacy commitments.

      General Motors released the following statement regarding the issue:

      “This agreement pertains to Smart Driver, a product we discontinued in 2024, and reinforces the measures we’ve implemented to enhance our privacy practices. Vehicle connectivity is essential for a modern and safe driving experience, which is why we’re dedicated to being transparent with our customers about our practices and the choices and control they have over their information.”

      Following the aforementioned Times article, which revealed how a Chevy Bolt driver’s telematics were secretly affecting their insurance rates, GM terminated its Smart Driver data-sharing initiative. Since then, GM has reached settlements with the FTC and now the California Attorney General, and it may soon face action from the Texas Attorney General as well (which has a remaining case on this issue).

      GM is reported to have made around $20 million by selling data obtained through OnStar and could potentially incur much higher penalties. This month's settlement in California marks a new record for the state, representing the largest settlement under the California Consumer Privacy Act (CCPA) to date.

      The way this particular controversy is unfolding feels like a glimmer of hope for consumer rights, as customer surveillance and data selling have rapidly become commonplace in society (which is unfortunate). Automakers, insurance companies, and other related businesses will likely continue seeking recurring revenue opportunities, so it's essential to carefully review the terms and conditions of your new vehicle's convenience features.

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