For a time, General Motors devoted itself to using the driving data of its customers that it collected through the connected services of their cars to sell them to third parties and cash in on them.
Customers never gave permission for this, at least not consciously, and some only found out a few months ago. Now General Motors acknowledges having taken steps to address this problem.
He used his car on a racetrack and his insurer doubled the price of the policy
Information is power, which is why data has become a lucrative business, especially now that we live in the internet era. Now that everything is connected, many companies collect data and sell it to third parties. Since cars are also connected, the business has reached the automotive industry.
The problem is that we rarely know what data our car collects and, above all, what happens to that data afterwards. A few months ago we talked about the General Motors case and its OnStar Smart Driver service; supposedly, the driving data this system collects is used to provide driving tips to help the driver improve driving habits and gain efficiency.
However, a Seattle computer scientist discovered that the data about his driving habits collected by his Chevrolet Bolt also served GM to cash in. The American giant sold them to a data broker who, in turn, made money by selling this information to insurance companies.
The owner of the Chevrolet Bolt had no idea about any of this and found out when requesting quotes from several insurers; one explained that his policy rose, despite not having had accidents, because of the LexisNexis report, that is, the data broker that bought the information from General Motors.
The New York Times picked up this case and, following the publication of the article, many similar cases have since come to light. The most striking thing is that none of these drivers were OnStar subscribers and they had never even heard of the Smart Driver service.
According to Jalopnik, Jenn Archer bought a Chevrolet Trailblazer in Illinois in 2022 and last month discovered that LexisNexis had her driving data when her insurance premium rose by 50%.
Another case concerns a Florida-based owner of a 2019 Cadillac CTS-V who has taken his car to the track on several occasions. Without having any accidents, his premium rose by more than $5,000 per year. Surprise!
Anonymity on the Track
And so a car cannot distinguish whether it is saving a life with a maneuver or simply circling a track or a highway at full speed. It could do so by positioning, but in practice it does not. For accelerometers and other sensors in the vehicle, there is only risk-based behavior.
Over the past months, dozens of federal lawsuits have been filed against General Motors over this issue. In all of them, drivers across the United States claim they did not knowingly enroll in the Smart Driver program and that they recently learned General Motors had provided their driving data to LexisNexis.
The lawsuits also emphasize that General Motors did not explicitly inform these drivers about the matter at any time, not even in the fine print, as the drivers themselves note.
In one of the latest reports, it was revealed that there is a reason for this: apparently, customers could only see this information briefly through a screen designed to mislead that should have been shown by the seller at the time of purchase.
Obviously, when all this came to light, it was a public-relations nightmare for General Motors, so the company took steps, despite the damage already done. In addition to stopping data sharing with LexisNexis and Verisk (another data broker), GM appointed Alisa Bergman as the new Chief Trust and Privacy Officer from April 29, 2024.
In statements to Jalopnik, General Motors confirmed the discontinuation of the OnStar Smart Driver program, the cessation of data sharing with LexisNexis and Verisk as of March 20, 2024, the tightening of privacy controls, and the appointment of Alisa Bergman as the new Chief Trust and Privacy Officer of General Motors from April 29, 2024. This is what GM’s spokesman told Jalopnik:
“At GM, we believe that vehicles are not just means of transportation: they are also technology platforms that can enrich the lives of our customers.”
“As our technology advances, we are committed to being transparent about our privacy practices and to giving customers control over their data. Over the past weeks, we have heard feedback from many customers about the OnStar Smart Driver product. Customer trust is a priority for us, which is why we have taken several decisive actions and continue to review our processes.”
Meanwhile, at the end of 2024 the Federal Trade Commission took action and sanctioned GM and OnStar for collecting and selling data on positioning and driving habits, in addition to triggering other class-action lawsuits.
The issue is that, even as General Motors makes these changes, it has already generated distrust among its customers (and among all those who know the case) and repairing that damage will be very difficult.
In any case, if you own one of these GM cars in Europe you should check the fine print of your connected car services. Just in case.
