GM to Pay $220 Million — Settles Claims of Illegally Selling Driver Data

General Motors will pay $220 million to resolve claims that it illegally collected and sold driving habits data to third-party brokers without adequate consent. The agreement, which settles a complaint from a coalition of 36 U.S. attorneys general, forces GM to fundamentally change how it handles the information generated by its connected vehicles.

The settlement addresses GM's 'Smart Driver' program, an opt-in feature that was supposed to provide feedback on driving habits. However, the states' complaint alleged that the collected data, including driver behavior and location information, was sold to data brokers. This practice often went unnoticed by vehicle owners.

The Price of Implied Consent

The core of the issue was not just the collection of data, but its subsequent sale. Both The Verge and Engadget report on the $220 million settlement figure, which resolves the multi-state action. The Verge, citing an earlier report from Reuters, notes the complaint stemmed from GM's sale of this sensitive information to data brokers. The coalition of attorneys general, which Engadget numbers at 35 and The Verge at 36, argued this practice was illegal.

This financial penalty, while substantial, is secondary to the operational changes mandated by the settlement. The pattern indicates a growing regulatory focus on the connected car as a massive data-collection device, an area automakers have been quietly monetizing for years. The cost of data storage is negligible; the cost of ignoring privacy regulations is now $220 million and climbing.

'Express Consent' Changes the Rules

The most significant outcome is the new requirement for GM to obtain 'express consent' from drivers before enrolling them in data-sharing programs. According to The Verge, the agreement explicitly requires GM to limit the driving data it collects and to be transparent about what is being shared and with whom. This moves the industry away from the murky 'consent-on-by-default' model buried in lengthy terms of service agreements.

This settlement is a clear signal to the entire automotive industry. For years, the promise of connected services has been a cover for building a secondary business model based on data sales. By forcing an 'opt-in' model, regulators are challenging that premise. It suggests that automakers must now justify data collection with clear value to the consumer, not just to their own bottom line or to third-party data firms.