Car Dealers Use GPS to Track Risky Buyers
There was a story on ABC's Good Morning America last week about some car dealers in Oregon installing hidden GPS tracking devices in vehicles sold to individuals with poor or downright bad credit. The rationale apparently is that the devices would help the dealers quickly track down and repossess their vehicles in the event that a customer defaulted on payments. According to the report, the devices are often installed in an undisclosed location in the vehicle because the dealers don't want customers disabling or tampering with them.
On the surface, it sounds like a reasonable thing for the car dealers to do given the risk they appear to be willing to take, especially in this lousy economy. After all, they are at least extending credit to people that most others won't even give the time of day to, and it is only natural that they want to protect their assets.
The issue, though, is about disclosure. It's one thing to install the devices and then inform customers about it, but an entirely different thing if that is done without any notice. One of the car dealers who appeared on the show said that he always informed buyers about the tracking devices and that they didn't appear to mind when he told them the reason why the devices were there. But what about the others, who aren't informing their customers about the tracking devices?
Those dealers might have a very good business rationale for doing that, and as far as I can tell, there are no laws out there that specifically require them to provide notice. (If I am wrong, someone please correct me.) But it still would be a gross violation of the buyer's privacy.
Current GPS tracking systems allow for a remarkable degree of surveillance. Many are Internet-enabled and allow anybody to log onto the Web and in an instant see a vehicle's current location or where it might have been in the past and when.
Sure, parents may install such trackers in their teens' cars, or companies might use the devices to track and manage their vehicle fleets, and GM might use them as a basis for its OnStar service. Some insurance companies might even offer customers lower rates in exchange for being able to monitor the amount of miles being driven annually by the driver and his or her driving habits-such as how often they brake and accelerate, for instance. Not all of these insurance programs involve GPS tracking yet, though at least one of them does. However, the context in which GPS tracking is being used in each of these cases is very different from a dealer trying to make sure that an individual who purchased a car doesn't disappear with it.
Granted, most car dealers who install such devices in vehicles are likely concerned only about getting the cars back in the event of a default and ordinarily couldn't care less about tracking the driving histories or whereabouts of their customers. Still, the fact that they can do that if they want to needs to be disclosed to the customer at all times. It's then up to the customer to decide if they want in.
This article originally appeared as a blog posting on our sister site, Computerworld.com.