Where are the vulnerabilities in the supply chain? When and where are goods the most at risk in during shipping? FreightWatch, a logistics security services company, analyzed five years of cargo theft statistics as a way to answer these questions. They produced a report that provides security and loss prevention personnel with information about trends in cargo theft, allowing companies to better predict and prepare for theft in order to mitigate losses. The ever-changing tactics of thieves requires constant vigilance.
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US Cargo Theft: A Five‐Year Review
FreightWatch has been collecting cargo theft data for the United States since January 2006. Theft incidents are recorded by date, city, county and state of occurrence, specific location (such as truck stop, roadside, warehouse), theft event type, product type, and value of the stolen load.
Until now FreightWatch has analyzed data and reported results by month, quarter and year.
Although this periodical information is vital for professionals in the supply chain industry to react immediately to trends, the shifting patterns of cargo crime are not always apparent in shorter-term studies.
With statistics now available for a full five‐year time span (January 2006 through December 2010), FreightWatch was able to assess trends and anomalies that transcend the boundaries of short‐term reports and thus provide our readers a much broader picture of this ever‐changing criminal enterprise.
Highlighted in this unprecedented report are the following findings:
- Overall cargo theft rates have increased every year since FreightWatch began tracking incident data in 2006. Up 4.1% in 2010 over the previous year, the growth of cargo theft has begun to level off somewhat as shippers and their transportation providers harden the supply chain on high‐value cargo. As a result of the heightened security efforts, the average loss value per stolen load decreased in 2010 by 17% over 2009.
- After ranking No. 1 as the product type most coveted by thieves for four years running, Electronics — cell phones, televisions, DVD players, etc. — slipped to second in 2010 for the first time. Taking its place at No. 1 was the Food/Drinks product type.
- Multi‐trailer thefts are emerging as a modus operandi (M.O.) of concern to the supply chain industry. This is not a new M.O., but the sharp rise in the number of cases should serve as a warning to logistics providers.
- While cargo theft is cyclical, incidents do not consistently drop during the same months each year. However, the peaks consistently occur during the summer months and early Q4, ahead of the Christmas rush. October is the No. 1 month for cargo theft in the United States.
- Violence in US cargo theft remains low year after year. Annually, less than 2% of theft incidents involve violence. Over the five‐year period, only 55 of the 3,589 thefts recorded, or 1.53%, involved violence. However, two hijackings in Los Angeles and a facility robbery in Memphis in late 2010 serve as reminders of the potential threat.
- Weekends, especially long holiday weekends, undoubtedly pose the greatest risk of theft to cargo at rest. Of the major holidays assessed, Thanksgiving ranked No. 1 for theft incidents three of the five years. Although the five‐year study served to confirm the general industry understanding that cargo is more prone to theft over weekend periods, the Electronics product type is one exception to the rule.
- Although the average loss value per theft of cell phones (a subset of the Electronics product type) plummeted in 2007 and rose slightly in 2008, the average loss skyrocketed in 2009 and 2010, reaching a peak of $3.65 million per incident.
- Thefts of Pharmaceutical products soared from 2006 to 2008, increasing by 283%. Since 2008, the rate of growth has been almost flat, likely due to intense efforts by the Pharmaceutical industry to harden the supply chain.
- This study confirmed California, Florida and Texas as the nation’s “Big Three” for cargo theft. A stunning 147% growth in theft incidents in New Jersey from 2009 to 2010 placed the state in the top five for cargo theft — and made it a state to watch.
- Los Angeles, Dallas/Fort Worth, San Bernardino County (California), Miami and Memphis have proven to be the areas at greatest risk of cargo theft.
- While Tennessee ranked sixth in total cargo theft incidents for the past five years, the state recorded the highest number of thefts in the Pharmaceutical product type over the same time period. With multiple large pharmaceutical distribution centers in the Memphis area have made Tennessee a hotbed for pharma theft activity. This is also seen, albeit to a slightly lesser degree, in Pennsylvania as well.
- The vast majority of thefts occur at unsecured parking areas in the United States, although thefts from secured parking locations grew steadily over the five‐year period. Transportation providers who rely on secured parking areas should be aware of this trend.
- Thefts targeting the Consumer Care market skyrocketed by 575% over the five years, from eight recorded cases in 2006 to 54 in 2010. This shift in targeting could be the result of the hardening of the Pharmaceutical supply chain as well as the desirability of Consumer Care products on the black market.
- There is a direct correlation between the price of metals and the rate at which these metals are targeted. This study clearly demonstrates the rise and fall of copper thefts in relation to copper’s market price over the five‐year period. Wise shippers will apply this knowledge to protect other product types whose value suddenly soars.
As is apparent by these findings and others in this report, the five‐year study served to underscore some established industry wisdom as it pertains to cargo thieves and their actions. The FreightWatch maxim that “Freight at Rest is Freight at Risk,” for example, is a now a proven fact for cargo in general.
More importantly, however, the study has brought to light trends that will allow a prudent shipper or transportation provider to take appropriate and timely steps to prevent or mitigate cargo theft in the future.
Above all, the study makes clear that efforts to improve security and harden the supply chain for certain product types have had success, but that the supply chain industry in general remains in dire risk from cargo thieves who have proven adept at shifting to softer targets.
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