GM Agrees To $220 Million Settlement After Illegally Selling Your Driving Data

As more and more people say they want data privacy in a new car, GM settles massive driving data case

📌 The Core Development

More than two and a half years after The New York Times published a bombshell story about car manufacturers selling sensitive driving data to insurance brokers , General Motors has agreed to pay $220 million to settle allegations and lawsuits about its allegedly dodgy practices.

Millions of U.S. drivers of GM vehicles enrolled in the controversial OnStar Smart Driver feature between 2016 and 2024 and were told the system would help them improve their driving and that it would not sell their data. Unbeknownst to many, the Smart Driver system silently collected precise geolocation and driving-behavior data, which was sold to major data brokers, including LexisNexis and Verisk. The data sold included details about hard braking events, speeding, and late-night driving.

🔍 Background & Sector Context

Once collected and sold, the data would be used to compile credit reports on drivers. Some insurance companies would use this data to set rates and, in some cases, even deny insurance. Just two weeks after the original story was published, General Motors was forced to terminate its deals with LexisNexis and Verisk. However, this didn't end GM's issues. In January 2025, the Federal Trade Commission banned the carmaker from sharing geolocation and driver behavior data with consumer reporting agencies for five years. The FTC also stipulated that GM must obtain express consent from consumers before collecting connected vehicle data, and provide owners with the ability to disable the collection of precise geolocation and driving behavior data.

Now, GM will pay $220 million to settle allegations led by the attorneys general of 36 states across the U.S., led by Washington State. In a statement issued to Reuters , a GM spokesperson said the automaker has strengthened privacy with the system. "Safer, more helpful and personalized experiences are enabled by connected vehicle data, and GM is committed to ​being clear about what ​information is used, how ⁠it's protected, and the choices customers have about what they share," the spokesperson said.

📊 Industry & Real-World Impact

Washington State Attorney General Nick Brown says many drivers were automatically signed up for the Smart Driver program when they subscribed to GM's OnStar services. The AG also alleges that dealership employees sometimes accepted the terms and conditions on customers' behalf without their consent. As if that wasn't enough, GM heavily incentivized dealerships for OnStar sign-ups, and dealership employees received bonuses based on how many customers they could get to

🔮 Strategic Outlook & What Lies Ahead

It's also claimed that GM's OnStar app told 370,000 drivers they weren't enrolled in the Smart Driver program even though they were, and that their data was being sold. When GM unenrolled them without notice, brokers and insurance companies retained the sensitive driving data.