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Trending Up: Smart Cars, Smarter Lawsuits
The connected car has hit some speed bumps. In the wake of FTC enforcement actions that began in late 2024, the agency has continued targeting automakers for alleged misuse of telematics and geolocation data. This spring, at least one high-profile case involved claims that manufacturers had shared driver data with insurers without proper consent, sparking follow-on investigations by multiple state attorneys general.
These developments have also fueled a wave of class actions. Plaintiffs are challenging how companies collect, store, and monetize driving behavior data, citing state privacy laws and longstanding statutes like the Driver's Privacy Protection Act.
Trending Down: Retrofitting Privacy Practices
A growing number of automakers are adopting a "privacy by design" mindset in new product development, shifting away from the longtime practice of developing privacy policies and practices to fit already-completed products. This shift reflects a practical response to increasing regulatory scrutiny and litigation risk: retroactive approaches can be inconsistent, harder to audit, and more vulnerable to regulator attack.
Recent class actions and regulatory investigations have underscored the importance of explicit user consent, deliberate planning and assessment of data processing, and end-to-end auditing—all of which are significantly easier to implement at the design stage. As a result, automakers are embedding privacy engineering into the development lifecycle, from early prototyping to vehicle software updates.
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