California Privacy Agency Fines American Honda Over Consumer Data Violations

If you think of your car as a smartphone on wheels, it’s easy to grasp how the auto industry can sell and profit from personal data. Many newer vehicles constantly communicate with car makers, thanks to features like location sharing, smartphone integration, and cameras.

Californians are legally entitled to opt out of the sale and sharing of their personal data, but Honda was making that too difficult, according to the California Privacy Protection Agency, which was established in 2020 when voters approved the California Privacy Rights Act. It’s the nation’s first and, so far, only state agency charged with protecting consumer data.

This week, the agency issued a $632,500 fine against American Honda Motor Company as part of the agency’s first investigation since it gained enforcement powers in 2023.

“Whether that information comes from the car, whether it comes from the website, whether it comes from elsewhere, it is protectable, but only if people assert their rights,” said Michael Macko, the CPPA’s head of enforcement.

The agency alleges that Honda violated Californians’ privacy rights, in part, by requiring Californians to provide “excessive” personal information in order to opt out of the sale or sharing of data; and by sharing consumers’ personal information with ad tech companies without producing contracts that contain the necessary terms to protect privacy.

In a statement, American Honda Motor Co., Inc. acknowledged it has agreed to pay the fine and simplify its opt-out process. “We have cooperated fully with the CPPA throughout their investigation and have already begun implementing the changes to our processes required by the order,” spokesman Chris Martin wrote.

Despite the size of the fine, Macko says the company’s promise to change its behavior is more important. “Businesses are usually more reluctant to change their practices than they are to write a check.”

Privacy advocates welcomed the CPPA ruling. “My hope is that enforcement actions like this generally incentivize companies to take consumer privacy more seriously across their products and services,” wrote Meghan Land, Executive Director of the Privacy Rights Clearinghouse.

The Federal Trade Commission and other states like Texas have also investigated the sharing and sale of personal data from vehicles, including driving habits.