Texas is suing GM for tracking drivers’ data—but these other car companies do the same thing

The next frontier in the battle over data privacy doesn’t revolve around a keyboard or smartphone. It involves what happens inside your car. 

Last week, Texas Attorney General Ken Paxton filed a lawsuit against General Motors (GM), alleging the auto giant violated Texans’ privacy rights by collecting and selling driver data to insurance companies without their consent. The suit alleges that, since 2015, GM has encouraged 1.8 million drivers in Texas to sign up to products including OnStar Smart Driver, promising such tools would help their driving by giving feedback on where to improve and ensure all vehicle safety features were activated. But that data has in fact been sold at a profit to third-party brokers, the suit claims, who “use the ill-gotten data to make adverse decisions when dealing with those same consumers,” such as increasing insurance premiums or dropping or refusing coverage.

A GM spokesperson says the company is reviewing the complaint and “share[s] the desire to protect consumers privacy” with the attorney general.

Paxton claims in the suit—which stems from a June 2024 investigation into automakers’ handling of personal data—that insurance companies are using the data they’ve bought from GM through third parties to give drivers risk scores that altered their insurance rates, depending on their driving abilities. In all, data from 14 million vehicles has been collected, alleges the lawsuit, which is the first state-level action taken against an automaker for selling private data.

But while Paxton’s suit singled out GM, the carmaker is far from alone in its data-sharing practices. A September 2023 report by Mozilla found that the auto industry was “the worst product category we have ever reviewed for privacy”, with habitual overcollection and sharing of personal data, and 84% of brands surveyed sharing or selling data to third parties. “They’re all bad,” Mozilla concluded. A New York Times investigation published in March 2024 found similar practices at a number of car companies, some of whom collated dossiers running to hundreds of pages that ended up being handed to insurance companies via data brokers.

“[Paxton’s suit] could just be the tip of the iceberg,” says Matthias Schmidt, an independent automotive expert based in Germany. “With more and more data points being collected by OEMs [original equipment manufacturers—in this case car companies] as they move into a more digital future, the temptation to monetize that will always be tempting where data is the new gold.”

The uptick of data sharing practices also signals a broader shift in how consumers are perceived of and treated by the companies that provide them with the most basic services—like getting from A to B. “The data economy is changing,” says Carissa Veliz, a technology ethicist at the University of Oxford. “We’re not owners anymore—at least not of anything that collects data about us and then can sell it.”

Alongside Texas’ attorney general, other lawmakers are looking askance at how car companies are gathering and reselling driver data. Democrat senators Ron Wyden and Ed Markey unveiled the results of an investigation of their own into the auto data industry in July 2024. (They also penned a letter asking the Federal Trade Commission to investigate the auto industry’s data practices.)

Wyden and Markey’s probe found that automakers, including Honda and Hyundai alongside GM, disclose driving data including acceleration and braking patterns to a company called Verisk, which Wyden and Markey call “a credit agency for drivers.” Honda told the senators that it shared 97,000 cars’ data with Verisk, getting 26 cents per vehicle in exchange, while Hyundai shared data from 1.7 million vehicles at a price of 61 cents each. Both companies told the senators that sharing the data allowed drivers to get rewards for better driving habits.

“Our investigation proved that automakers are willing to violate their customers’ privacy and sell their location history and other driving data for mere pennies,” Wyden tells Fast Company. “On top of that, the evidence shows these companies illegally sold location data without getting drivers’ consent. That’s why Sen. Markey and I asked the FTC to step in and hold automakers accountable.”

https://www.fastcompany.com/91175277/general-motors-texas-driver-data-ron-wyden-ed-markey?partner=rss&utm_source=rss&utm_medium=feed&utm_campaign=rss+fastcompany&utm_content=rss