GM settles with FTC over claims of selling driver data without consent

General Motors is settling with the Federal Trade Commission (FTC) to resolve claims that it shared detailed telematics data to third-parties without consumers’ permission.

Flashback: Since last summer, General Motors has been entangled in controversy after two U.S. senators—Ron Wyden of Oregon, and Edward Markey of Massachusetts—claimed the automaker used deceptive tactics to manipulate customers into signing up for disclosure of the data to brokers. At the time—GM denied doing anything wrong.

But it did prompt the FTC to conduct its own investigation which resulted in some alarming allegations focused largely on GM’s OnStar “Smart Driver” feature. 

• In the complaint—the FTC alleges GM misled customers into enrolling in Smart Driver, claiming it would help assess driving habits.

• Instead, GM collected detailed data on location and behavior—like speeding or late-night driving—and sold it to consumer reporting agencies. 

• Those agencies passed the information to insurers, who used it to pump up premiums.

Worth noting: In a statement, GM says it ended its data-sharing partnerships in March 2024 and discontinued its Smart Driver program the following June.

Zooming in: Tracking geolocation data can dangerously encroach on consumer privacy by exposing intimate details of their daily routines, medical visits and shopping habits. 

• A recent survey by Mozilla of 1,300 people, found that 96% percent of consumers believe they should own and control any data their cars generate. And 78% feel uneasy about automakers collecting driver data at all.

• The reality? 92% of automakers give drivers little to no control over their personal data.

Bottom line: Automakers can rake in billions by monetizing data, but it comes at a cost: eroding customer trust, losing brand loyalty—and growing regulatory scrutiny. As data privacy concerns grow, companies across the auto industry will face tougher questions about how they handle sensitive customer information.

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