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When shopping for a new or used car, many buyers are surprised to learn that their dealership may have already installed a tracking device as soon as the car hits the lot. Some dealerships then attempt to sell these devices as “must-have” features, often at an inflated price.
A recent Reddit r/Justrolledintotheshop forum discussion sparks some interesting dealership insider information when the OP showed what he presumably believes is a tracking device monitoring him because it appears to have an OBD2 port plug.
However, some thread comments identify it as a LoJack anti-theft tracker, with one comment complaining that even these tracking-type devices are a problem for car shoppers:
“My wife and I just bought a used Odyssey and the dealer claimed it cost $2,500 for the LoJack, but they would ‘give’ it to me for $1,500. I told them to just remove it. He said it would cost $900 to remove.”
This story highlights a growing concern among car shoppers: What exactly are these devices? How do they work? Do you really need them?
Tracking Devices Are Both a Solution and a Problem
Car dealerships installing tracking devices on new cars is legitimate when the dealership uses it for inventory and theft protection. However, for car shoppers, this can be a double-edged sword:
- There is no guarantee that such devices are not recording your driving habits for questionable―if not nefarious―purposes by loan institutions and insurance companies.
- There is a high likelihood that data recorded or transmitted by the tracking device is being sold without your permission.
- Dealerships are earning questionable profits with inexpensive electronic trackers placed on every new vehicle hitting the lots today.
In short, tracking devices for legitimate uses are sometimes abused by car dealerships.
However, there is also some confusion regarding the differences between tracking device types.
To help clarify these distinctions before returning to the OP’s thread discussion, here are the fundamental differences you need to know about.
What Is a LoJack?
A LoJack system is an anti-theft device designed to help police recover stolen vehicles. Unlike GPS trackers, LoJack uses a hidden radio transceiver that law enforcement can activate if your car is reported stolen.
- Installation: Professionally hidden inside the car (not plugged into the OBD2 port).
- Activation: Only triggered after you file a police report.
- Tracking: Uses radio frequency, which works even in garages or shipping containers.
- Impact on Driver: Dormant until activated, meaning no battery drain and no monitoring of your driving habits.
While LoJack can be useful, many dealerships mark up the cost—sometimes thousands of dollars—when the actual unit is far less expensive. Moreover, rather than clearly explaining whether you need this add-on, the sales department pressures sales personnel to gloss over the details.
Idk about your experience, but my dealer pays $126 for them. Still charge $500 out the door and only pay me $6 to put one in. Our salespeople do rip them if they’re not sold. ‒Dogteeth56
What Is an OBD2 Insurance Tracker?
An OBD2 tracker—such as Progressive Snapshot, Allstate Drivewise, or State Farm’s Drive Safe & Save—is a small dongle that plugs directly into your vehicle’s OBD2 diagnostic port. Unlike LoJack, it doesn’t fight theft. Instead, it monitors your driving behavior to adjust your insurance rates.
A similar OBD2 tracker might be installed to benefit loan agencies in case of a late payment. In some types, the tracker can prevent your vehicle from starting until payment is made. In worst-case scenarios, the tracker is used to repossess the vehicle under the pretext of a loan default claim by the lending institution or the seller, who can then resell your vehicle.
These devices track:
- Speed, acceleration, and braking
- Time of day you drive
- Trip length and frequency
- Current location
And the data is then transmitted to your insurance company or lender via a cellular connection.
Potential Problems:
- Battery drain: Because they are always active, they can cause parasitic drain if left plugged in.
- Privacy concerns: Insurers can sell or share your driving data with third parties.
- Premium risk: While advertised as a way to save, many drivers report that “normal” driving behavior triggers penalties, and opting out later can even raise your rates.
LoJack vs. OBD2 Tracker: The Key Differences
- LoJack = Anti-theft recovery tool. Only active when police or a subscribed security service turns it on. Does not affect privacy or insurance.
- OBD2 Tracker = Insurance and lending institution monitoring tool. Active 24/7. Impacts privacy, battery health, and potentially your insurance premium and/or ownership of the vehicle.
Why Dealership Tracking Devices Are a Problem
Car dealerships love installing these devices because:
- They cost very little but are sold at a huge markup (sometimes over $1,000).
- Many shoppers don’t realize the device is already installed until paperwork time.
- Even if you decline the service, the device often remains in your car.
As one insider explained:
Advertising
This is a Lo-Jack device, which costs about $5-10, and dealers put them in cars (some in all of them). They then try to sell it to you for $1K (plus subscription). When you don’t buy it, they just leave it in, because it’s so cheap, and they have a deal with the “dealer services” companies who install them (even though they are just a Y-cable plugged into the OBD port). So basically, it’s cheaper to “leave them in” than to remove them. Seriously, they’re a few bucks to make (really basic cellular modem and GPS)…they love to sell these because it’s damn near pure profit. ‒PinkertonFld
Yep. I bought Civics in 2019 and 2022 for my two kids. My Honda dealership pre-installs trackers in every car as part of their new car prep.
The sales guy touts the “benefits”, like free monthly service for 5 years, and being able to locate your car in a parking lot and get some basic telemetric data. My dealer charges $1,000 for those devices; it’s a separate line on the settlement statement.
They also had some sort of disclosure/acknowledgement document in the purchase paperwork stack.
I’m guessing the lender sends a kickback to the dealer when they put those devices in new cars, so they can repossess them if/when loans go delinquent.
I said, “No way”. They waived the cost but wouldn’t remove the device. I planned to remove those devices myself, but never did. Oh well. ‒KitchenPaleotologist
Confusing car owners even more is that tracking-type devices like the one shown in the forum might not be an actual LoJack product, but a similar-looking one with features that may or may not be used to track a car after it is sold.
As one insider commented:
“That looks identical to the ones I have to install for my dealership. We’ve had issues in the past with people trying to steal our vehicles, so we began putting these things into our cars. They monitor the vehicle’s location (obviously), battery voltage, fuel level, and odometer. I will say that once the vehicle is sold, the dealership no longer has access to the vehicle tracker, and only the new owner of the vehicle does. I see these ones as “non-invasive” as no wires get cut or spliced into. They’re a lot cleaner to remove, and they don’t damage anything. I can’t say the same about the other units I’ve seen, and it probably varies by brand, too. Different brands use that same setup. I’m not saying that I support the use of these trackers by dealerships, but the discount I get from my insurance from having one is nice.” ‒Silver0923
And another that is a little scary if it happens to you:
“Bought a used car, 14 months old, from a dealer (either Hyundai or Subaru, I forget who they were). Paid cash for it. Found out after I did the paperwork that the dealer put a LoJack in it. I had negotiated an out-the-door price, so they weren’t trying to pull a fast one on me. I was mildly annoyed that I had left money on the table with the deal though. It was $750 for the LoJack and a year’s subscription.
So a few weeks later, I got around to tearing it out of the car. I pulled that out and, in the process, found ANOTHER alarm and tracker. This one was tapped into the car’s wiring harness in about 3 or 4 places under the hood. Pretty sure it wasn’t part of the LoJack system as the FCC ID on the box pointed to it coming from an alarm company called KAAR. I suspect the original owner (or selling dealer) installed it. Got that one out after an hour of tracing wiring and cutting one wire at a time with the engine running in case it was an immobilizer of some kind.” ‒dyslexic_of_borg
How to Protect Yourself
The best way to avoid surprise fees or unwanted devices is to make your wishes clear before the car even arrives on the lot.
Former dealership employees revealed that new cars are often prepped with trackers “off the truck.” But if a buyer specifically requests no add-ons, the dealership can sometimes leave them out.
As a technician who worked at a dealership, I can confirm this. Installed in every single new car we received unless specifically requested not to install it right off the truck, which was rare (employee buying a car, etc.). If the customer didn’t want to buy the service, we just left the GPS. Some people complain and we removed them, but most people won’t ever know it’s there. It’s as far as I know disabled and not sending information once deactivated, but I could be wrong idk, I just installed them. ‒F7skillz
Action Steps for Shoppers:
- Ask in writing: If preordering, request that no LoJack or third-party tracking devices be installed.
- Check the OBD2 port: Look for a dongle plugged in during your test drive.
- Review the paperwork: Watch for hidden line items like “theft protection,” “tracking service,” or “vehicle recovery system.”
- Negotiate removal: If you find one installed, demand removal at no cost before purchase.
For More About The Problems With Tracking Devices and What To Look For, here is an informative video from an insider who installs these devices:
The SHOCKING Truth About Hidden GPS Trackers in Cars Installed By Toyota
Final Thoughts
Dealership-installed trackers—whether true LoJack systems or OBD2 insurance/lender institution monitors—are marketed as helpful add-ons, but they often benefit the dealership, lending institution, or insurer more than the driver.
By educating yourself on the differences between these devices and requesting that no tracking systems be installed upfront, you can save money, protect your privacy, and avoid unnecessary headaches.
What do you think? Will your dealership accommodate your request to not install a LoJack or other similar tracking devices or unnecessary add-ons? Share your experience in the comments section below.
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Timothy Boyer is an automotive reporter based in Cincinnati who currently researches and restores older vehicles, often incorporating engine modifications for improved performance. He also covers modern cars—including EVs—with a focus on DIY mechanics, tool use and selection, and other topics related to automotive repair. Follow Tim on Twitter (@TimBoyerWrites) and Facebook for daily updates and insights on new and used cars and trucks.
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