Commerce Department Pushes for Car Data Privacy Transparency

The U.S. Department of Commerce has proposed requiring car dealerships to place data privacy stickers on vehicle windshields. These stickers would inform buyers whether the vehicle’s data is collected and sold, as well as provide guidance on how to opt out of tracking.

The sticker is intended to be clear and concise, similar to existing Monroney labels that display fuel efficiency and safety information. It may also feature a QR code linking to more detailed privacy information.

This initiative follows growing concerns over how automakers utilize data from connected vehicles. A 2023 Mozilla Foundation study revealed that many car companies poorly protect customer data and rarely explain how it is used. The report also recommended that IoT devices, such as smart thermostats and cameras, allow users to fully opt out of data collection.

However, the Alliance for Automotive Innovation, representing automakers, has not endorsed the proposal, arguing that automotive companies already inform consumers about data collection.

The Department of Commerce also suggested mandatory regulation of data collection and use in IoT devices. Industry experts believe that a new privacy information sticker could help people understand that their vehicles may transmit data to manufacturers and third parties, a fact many are unaware of.

Creating a universal opt-out system for IoT tracking would be a complex and costly endeavor, and device manufacturers may resist due to high expenses. Nonetheless, experts assert that such measures are essential to protect users, as these devices can collect vast amounts of personal information, including video and audio from within the home. The report’s recommendations will be forwarded to a federal task force, which will decide whether legislative changes are necessary to implement the proposed measures.