Mileage verification is crucial for numerous modern businesses, especially those in the mobility sector. From providing accurate auto insurance quotes to scheduling timely auto repairs and implementing fair road usage charge programs, knowing the precise mileage of a vehicle is essential. While On-Board Diagnostics 2nd Generation (OBD2) dongles might seem like a convenient solution for mileage tracking, particularly for those looking to Read Odometer From Obd2, they fall short when it comes to reliable and scalable mileage verification, especially for businesses.
Originally designed for vehicle diagnostics, OBD2 dongles have been repurposed by some as mileage trackers. However, these devices were not built with the everyday consumer or large-scale business applications in mind. For individual car enthusiasts, the ability to read odometer from OBD2 might be appealing for performance tracking. However, as one Reddit user, Etrigone, aptly noted, such detailed tracking is often “nice, but hardly critical” for the average driver who lacks the interest or technical know-how to manage dongles for simple mileage tracking.
For businesses, relying on OBD2 dongles translates to significant costs—at least $30 per driver, encompassing shipping, installation, and ongoing troubleshooting. While individual drivers might find value in OBD2 devices, businesses requiring robust mileage verification need to explore more effective and reliable alternatives.
The Drawbacks of OBD2 Dongles for Mileage Tracking
Although OBD2 dongles offer a range of functionalities for vehicle monitoring, they present several significant challenges when used for mileage verification, especially when scaled across a large user base.
Inaccuracy and Incomplete Mileage Data
A common misconception is that OBD2 dongles directly read odometer from OBD2 port to provide the vehicle’s exact mileage. In reality, OBD2 dongles do not access the actual odometer reading. Instead, they estimate mileage by calculating the distance between trip start and end points, often relying on GPS location data. This method of inferring mileage is inherently prone to inaccuracies. Minor discrepancies in location or trip detection can accumulate into substantial errors over time, skewing risk assessments for auto insurance or leading to inaccurate service recommendations.
Furthermore, the data comprehensiveness of OBD2 dongles is questionable. Can businesses truly achieve reliable and effective services based on potentially incomplete mileage data collected through these devices across their entire customer base? While OBD2 dongles are known for real-time data delivery, they are limited by the data accessible through a vehicle’s OBD port. Notably, this port does not provide direct access to location and odometer data. This reliance on the OBD port also presents compatibility issues with newer vehicles, particularly electric vehicles (EVs), which may not feature a standard OBD port. In such cases, drivers often need to purchase separate adapters to use dongles, adding complexity and cost. For example, Emovis, a road usage charge solution provider, opted for Smartcar to integrate Tesla Model 3 vehicles into their programs precisely because of these OBD2 compatibility issues.
Unintentional Malfunctions and User Inconvenience
Even when an OBD2 dongle is physically compatible with a vehicle, seamless operation is not guaranteed. Some vehicles exhibit adverse reactions to OBD-II devices, including triggering false alarms or even draining the car battery. These unpredictable issues create operational headaches for both businesses and their customers.
The user experience with OBD2 dongles is also far from ideal. Drivers are burdened with waiting for device delivery, figuring out the installation process, and ensuring the dongle remains securely connected. A loose connection, even from a minor accidental bump, can render the device unreliable.
Consider this scenario: a policyholder’s computer bag inadvertently dislodges the OBD2 dongle. The device stops tracking mileage, unbeknownst to the insurer. Lacking mileage data, the insurer might either overestimate the policyholder’s monthly usage, leading to a more expensive plan, or suspend the policy until manual odometer verification is performed. These disruptions highlight the operational fragility of OBD2 dongles for consistent mileage tracking.
Software Incompatibility
A frequently overlooked aspect of OBD2 dongles is their software ecosystem. These dongles often operate on separate platforms that are not easily integrated with existing business systems. This lack of seamless integration necessitates extra effort for businesses aiming to synchronize mileage data with their current tools and workflows.
Auto insurers face difficulties in aligning dongle data with policy management systems, repair shops struggle to integrate mileage data for service reminders, and road usage charge programs encounter challenges incorporating OBD2 data into their billing infrastructure. Instead of simplifying operations, OBD2 devices can introduce additional layers of complexity and administrative burden.
Intentional Tampering and Mileage Fraud
Beyond unintentional failures, OBD2 dongles are susceptible to intentional tampering. A driver wanting to underreport mileage, for instance before a long road trip, could simply unplug the dongle. There is no mechanism to detect such tampering. Meanwhile, insurers continue to calculate premiums based on incomplete data, leading to revenue loss.
Mileage fraud is a significant problem, costing auto insurers billions of dollars annually. It’s estimated that over half of drivers misreport their mileage, resulting in up to $29 billion in losses. This fraudulence impacts not only insurers but also other service providers who rely on accurate mileage data, such as repair shops for maintenance scheduling and road usage charge programs for accurate billing.
Privacy Concerns and Data Transparency
In today’s privacy-conscious environment, consumers are increasingly wary of data collection practices. OBD2 dongles, with their opaque data handling, can raise significant privacy concerns. Recent negative press surrounding data-driven car insurance has amplified consumer sensitivity to data privacy in the automotive sector.
Many drivers are uncomfortable with the idea of a device plugged into their car constantly tracking their data without clear transparency. Questions arise: What specific information is being collected? Who has access to this data? How is it being utilized? This underscores the critical importance of explicit data consent and transparent data practices, areas where OBD2 dongles often fall short.
High Implementation and Maintenance Costs
OBD2 dongles are not a cost-effective solution, especially at scale. Insurers and other businesses must bear the upfront costs of purchasing hardware, shipping devices to customers, and managing replacements for lost or damaged units. If a customer discontinues service before the initial device cost is recouped, it represents a direct financial loss.
A single new OBD2 dongle can cost between $50 and $60, while even refurbished units still average around $17. Adding to these hardware expenses are ongoing subscription fees per vehicle and the logistical overhead of distribution, fulfillment, and returns. Instead of enhancing profitability, OBD2 dongles can quickly become a substantial financial burden, particularly when compared to software-based alternatives that eliminate hardware costs entirely.
Connected Car APIs: A Superior Alternative for Reading Odometer Data
Leveraging a connected car platform like Smartcar presents a compelling alternative that significantly reduces overhead costs and overcomes the limitations of OBD2 dongles. Connected car APIs offer a more robust and efficient approach to read odometer from OBD2 and other vehicle data points.
The advantages of using a connected car API are clear:
Accuracy: APIs directly access a vehicle’s actual odometer reading, eliminating estimations and inaccuracies inherent in OBD2 dongle-based calculations. This ensures precise, real-time data, leading to fairer pricing and more reliable services without customer disputes over reported mileage.
Ease of Use: Smartcar’s onboarding process is remarkably simple, requiring just a few clicks. Customers avoid the hassle of waiting for hardware, complex installations, and potential compatibility issues. They simply log into their existing car account, grant necessary permissions, and the connection is established. No dongles, no loose connections, and no risk of battery drain.
Reliability: Unlike temperamental OBD2 devices, car APIs provide consistent and automatic odometer data retrieval. Customers cannot manipulate mileage records by disconnecting a device, guaranteeing data integrity and reducing the risk of fraudulent claims.
Privacy: Transparency and consent are central to API-based solutions. Smartcar’s permission-based onboarding clearly outlines the data being accessed, whether it’s odometer readings, location, or other vehicle information. Customers maintain full control over their data, fostering trust and enhancing brand reputation for mobility businesses.
Cost-Efficiency: Smartcar offers predictable SaaS pricing that scales flexibly with business needs. Eliminating hardware, shipping, replacement, and repair costs translates to significant savings. Businesses can reallocate resources from logistical complexities to core product development and customer-centric innovation.
Software-driven solutions have revolutionized mileage verification, making methods like OBD2 mileage trackers seem outdated and inefficient. Interested in exploring how the Smartcar platform can transform your mileage verification process? Request a demo today to learn more. We are ready to assist you!
