The Decibel - Behind the rise of car thefts in Canada

Episode Date: July 18, 2023

Car thefts have surged in Canada, with some provinces seeing increases of 50 per cent in a year. And Canada has become particularly popular for this type of crime.Today, The Globe’s wealth management and insurance reporter Clare O’Hara tells us what’s behind the rise of car thefts, and how you can best protect your own car from being stolen.Questions? Comments? Ideas? Email us at [e-mail]

Certainly something I thought of when I started to dig into the story is I thought of a really close friend of mine who had his car stolen right before his eyes. It was late at night, I believe it was around one or two in the morning, and he heard a bit of a commotion outside. And he went to his window and saw an individual walking around his car. His first instinct was maybe to run outside and stop the theft from happening. But very luckily, he quickly rethought that because he does have young children in the house. His first instinct was maybe to run outside and stop the theft from happening. But very luckily, he quickly rethought that because he does have young children in the house. And so he started to bang on the window and got the police, calling the police on the phone. But the individual just, you know, smiled up at him, gave him a wave, had already reprogrammed the car, opened the door, got in and drove away.

All within probably 30 seconds to a minute of him trying to get through to the police. Car thefts are a huge problem in Canada right now. And it's getting a lot worse. Claire O'Hara has been reporting on this for The Globe. She's our wealth management and insurance reporter. Today, Claire tells us why Canada is such a hotspot for car thefts and how you can protect your own car

from being stolen. I'm Mainika Raman-Wilms and this is The Decibel from The Globe and Mail. Claire, thank you so much for joining me on the podcast. Great. Thank you for having me. Let's talk about the numbers here. How much of an increase are we actually seeing in car thefts in Canada? This is what really was interesting to see, that for the first time, all of the provinces across Canada has seen a pretty big jump in the number of car thefts that were happening in 2022. And the biggest ones are in Ontario and Quebec. So they both saw about a 50% increase in the number of vehicles that were being stolen. And even interestingly enough, provinces like Alberta,

which when you look at the numbers only saw an 18% increase, that's a province that had had years of declines in car thefts. And then Atlantic Canada also overall saw a big jump around 35 percent. And when you look at the individual provinces, such as Newfoundland and PEI, they're around 55 or 56 percent. Wow. Okay. So I guess the big question is, why is this happening? Why are we seeing such a big rise? And so it comes down to two things. One is, I think in the past, there was a lot of vehicles being stolen for localized resale. Like, you know, auto theft would happen and they'd recalculate the VIN numbers and they'd sell them on the local markets. Well, now we're almost becoming a source country for organized crime rings who are coming in and stealing vehicles and exporting them out of the country.

In Canada, when we think about it, we actually have really good waterways to do this. in and get really densely populated cities that have a lot of vehicles and get them into shipping containers and export them off our rivers. Wow. I wouldn't have really thought of that. But the proximity to the waterway, like the St. Lawrence or even like the Atlantic ports is actually a big factor here then. Absolutely. And that's where organizations like Equite Association, who's working with the insurance

industry, they're working with local police, they have started to track these numbers. They've been hired to completely look at what's happening and how can they combat this vehicle fraud. Wow. And we're going to get into that too. But I also want to ask, we hear too about how technology is actually making it easier to steal cars. Is that a factor here as well? Absolutely. So this is actually another big key factor because majority of the vehicles that's in Ontario and Quebec,

I think Quebec is more than 75% of these vehicles that are being stolen are vehicles that are 2017 or newer. And that means these are vehicles that are built with this new technology, which is great for consumers to be able to get into their cars with keyless fobs and automatic car starters. And that is one of the big factors. They can reprogram your key fobs. They can go open up your gas tank. They can actually identify what car you have just by looking at information that's on that flap.

They put it into a system that looks very much like a Nintendo Game Boy and pull up what your car is and they'll reprogram your car starter within a minute. Great for consumers, also great for thieves as well then it sounds like. Absolutely, yeah. So what is, we know that there's an increase here, but what are the most common vehicles, like the types of vehicles that are actually being stolen? So if we're thinking about the cities and provinces that are being targeted, these are densely populated cities that have a lot of the same cars. And typically in Ontario and Quebec, these are going to be SUVs. When we look

Canada wide, it's interesting that everyone's always curious about what the top vehicles are. But the Honda CRV built between 2016 and 2021, that's the most common vehicle in Canada to be stolen with the Lexus RX series between similar years, 2016 to 2021. And do we have any idea why those vehicles? I think it's the resale value of some of these vehicles. Obviously, any type of luxury vehicle is going to cash in for organized crime rings. They're going to be able to get a lot of top dollar for that. But it's also when

you break it out provincially, Ontario, the highest car is the Lexus. So they obviously, this is a province that might have more of these. They're commonly found more in cities than in rural areas. And then when we look at other provinces like Alberta, and you think of the Western, their big popular car would be trucks. And interestingly enough, it's the older models of trucks, like a Ford F-350 from 1997 to 2007. That's the most common truck to be found. And it's probably because there's more of them. So it's not that they're specifically looking for that, but there might be more of them in those farming communities, and they can get a lot of them at one time. It's also got lots of parts that people would be

looking for to replace, and auto parts also play a big factor into what these thieves are looking for. Yeah. Okay. So it's interesting. So it actually, it changes a little bit across the country based on what kind of vehicle is popular. So what happens once they're stolen? Where are they ending up? You're right. There's a couple things that are happening when they get stolen. And interestingly enough, what investigators are finding with Alberta is these vehicles, even in Alberta, are being found in the Port of Montreal. Even from Alberta? Even from Alberta. So when these vehicles are stolen, it's very quick the way these organized crime rings work. It'll be the middle of the night. They'll get them all to sort of one area

and start loading them into shipping containers, and then they're moved pretty quickly. In other situations, they may leave the vehicles for a few days, and they may be doing this to see if there's trackers on the cars or maybe compiling more in one area. So one individual I spoke to is John Dersey. So he's a Barrie resident who had his car stolen from the Toronto International Airport. Perhaps maybe they thought that he had taken off for a trip and it was a great time to steal his vehicle. He was only there for a one day conference. And he did have a tracker on his car. And so it was found in

an empty parking lot with 15 other vehicles with empty shipping containers around the car. His car was able to be found. But if they had made it into the shipping containers, they do make their way to the Port of Montreal. And then unfortunately, they are getting out of the country. So the police, the local police are working with Interpol and Equite Association. They're trying to really combat what's happening to keep these vehicles from leaving the country. Okay, so where do they end up? They're going to various places. They end up in Europe, obviously, is where they can go. But they're also ending up as far as Africa and the Caribbean. Even when we're looking at Interpol, which has set up this fascinating database of, I think there's 135 countries who report into this Interpol database, and they're all reporting the

vehicles that are reportedly stolen. So there's about 7 million vehicles that are in that database. And Interpol is even saying that once vehicles show up in, say, Europe, they're actually tracking cars that show up as far as South America and Australia. Wow. So it's really, it's like they could end up anywhere essentially. Yeah. And if they're stripping them for parts, then that's even probably even more widespread. Do we have a sense of what happens to the cars once they get to these countries? Sometimes they're stripped for parts, but if they're not, like what are they used for? So Equite Association absolutely tracks where these vehicles go and what ends up with them. And what they're finding is that a lot of these cars are being stolen by domestic and

international criminal organizations that are then using the proceeds of either selling the cars or actual individual car parts. And then they're being used to finance domestic drug trafficking, arms dealing, human trafficking, and international terrorism. So these are really ending up kind of supporting nefarious purposes here then. Absolutely. And right up into terrorism. You know, that's the big one that Interpol is looking at, that it's going as far out as big terrorist groups that are using these vehicles in their funding initiatives. So we talked about how this is a big issue in Canada as a source country for these vehicles. Is that the situation in other countries too? Or how does Canada compare? So Canada is, as we can just see over the last year,

we're definitely becoming a source country for this, but we're not alone. The United States of America has been battling the same type of car theft. They see very similar situations in their ports of New Jersey, and they also have a lot of issues with the border on Mexico. So they see quite a few cars being stolen and driven right into Mexico and being sold off with the Mexican cartel will be using them. But in the previous years, we've never seen numbers so high. So I don't think we would have identified ourselves as a source country, and that's changing. Okay, so once your car is stolen, Claire, how likely are you to ever actually see it again? Yeah, so I mean, most people would think that they'll never see their car again.

But the police are now saying they are looking at increasing the recovery rate for stolen vehicles. And that's happening at the Port of Montreal, as well as probably in Halifax. But they have been able to, in the last three years, been able to recover about $40 million worth of vehicles. And that's a big jump from what we had ever seen before. And there are some situations that Equite Association has seen where even if they do get overseas, that they are being returned by even foreign police jurisdictions. That if they find that VIN number or that vehicle in that database, they are exporting it back to our country. We'll be back in a minute. Let's talk about insurance here. So if your car is stolen, your insurance company would either pay to replace it or to fix it if authorities do manage to track it down and it needs to be fixed.

That's probably pretty expensive, though, especially if it is happening a lot and we're saying the rate is really increasing right now. So how much is this actually costing insurance companies? So this is a very baffling number. Last year, the insurance industry lost more than a billion dollars due to auto theft. And when we look at previous years, that's up from 700 million in 2021 and 160 million in 2018. Whoa. So that's like five years ago. It went up from 160 million to a billion.

To a billion dollars. And this is why the insurance industry is taking this seriously. I wonder, so if the insurance industry is having to pay so much more now because cars are being stolen so much more frequently, how is this cost making its way down to the consumer, right? If you own a car and you are paying your insurance every year, is it changing the premium that you're paying? Absolutely. I mean, you have to think that's the way insurance works. You know, the masses pay premiums to pay for minimal payouts. And when you have something significant like a billion dollars in losses, it's certainly something the insurance industry can handle in paying out those claims.

But it's definitely going to trickle down to the consumer. So, for example, in Ontario, the average consumer pays about $1,700 a year for their car insurance. And $125 of that is due to auto theft. And so while we might think $125 isn't that much of $1,700, every little bit counts on that monthly payment. So if it's a billion dollars today, and next year, and the years, it continues to get worse, or even maintaining at a billion dollars, that could go up to $300, $350, $400. And that gets into a situation where consumers now want to shop around, because that's going to impact, especially in today's economy, their bottom line. And is this across the board?

Like are all insurance companies adding to their premiums now or changing the makeup of their premiums because we are seeing this increase in thefts? Right. So that figure comes from the Insurance Bureau of Canada. And so they are representing the majority of the property and casualty insurers in Canada. So while there may be one or two insurers

that have not yet increased any premiums due to that $1 billion number, it certainly is going to trickle across the sector. And for that reason, consumers can certainly shop around and they might be able to find one that could maintain their monthly payment or their annual premium. But over time, if we continue to see these numbers build, I would think it's very likely that majority of insurers will have to pass that on to consumers. So even if you don't have your car stolen, you are still paying for this. If you have a car and you're paying for insurance, you're still going to be paying for this in some way through your premium. Right. It gets sort of across the masses. Yeah. All right. So insurance companies obviously then would have a vested interest in wanting to decrease car thefts because they're paying a lot of money out for this as that would decrease their own costs if they could reduce car thefts. So what are insurance companies actually doing to mitigate this?

Right. So the insurance costs also include things like rental cars. So in the case of Mr. Dersey, he had to get a rental car because while he got his car back, his car was actually damaged. I think there was wires cut. He couldn't get it back. It sat with the police for a couple of days and then it was shipped off to the dealer. The dealer didn't have the parts on hand, so he had to get a rental and that's covered by the insurance company. So the insurance industry are becoming large advocates to helping solve or at least help consumers try to prevent auto theft from happening from their vehicles. And so what kind of measures are we seeing insurance companies try to advocate for here to decrease thefts?

Right. So the insurance sector as a whole, and they're all in agreement of this, has sort of come together with what they're calling the layered approach. And it sounds very common sense when you look at it. But what they're saying is, if you put several of these ideas together, it can really impact whether someone will get your vehicle or not. So the very simple first layer to all this would be like keeping your car door locked, parking in a garage if you have one, parking in a lit area, as well as making sure your windows are completely closed. And then there's second layers, things like car alarms. We always hear the really annoying car alarm in the parking lot and think, do these actually do anything? But in the middle of the night, if a car alarm goes off, majority of the time, they'll

leave your vehicle, probably your street completely, and go on to another neighborhood. So it's just enough to kind of deter a thief from taking it. Yeah. And the other things are like the classic club car club that you would attach to your steering wheel and while they can certainly get through that device it slows them down things like even having stickers or decals on your car that would make it stand out they don't really like that either anything that differs yeah so if you have like a Thule roof rack and you have all the stickers and everyone knows, oh, that's Bob's car with all the stickers, it kind of makes them go to the next vehicle. So those decals are actually like theft to turn devices as well. Absolutely. Yeah. The family stickers that we all saw years ago

could potentially make someone go to the next car. And then there's a layer that's a little bit maybe more expensive to do. One of the things that thieves do is they have, as I mentioned, automatic devices that can reprogram your key fobs. You can keep those keys. Most people keep them inside, you know, their front hallway. You can get boxes that will prevent the radio signal from coming out, and it locks it basically for them. You can also get an onboard diagnostic port lock. They're called OBDs. That's the thing that they're reprogramming. If you have a lock on your car for that, they're not able to do that. And lastly, this is where the industry as a whole is really

coming together, our tracking systems. And the insurers are actually coming out and saying to individuals, we're going to cover the cost of these tracking devices because it's helping them cut down on costs. And just lastly here, Claire, I mean, after you've done all this reporting on it, I just wonder, does this information make you rethink, I don't know, the safety of your own vehicle or what you do to kind of the steps you take to make sure it's safe? So it's interesting that it does. You know, I have an SUV. It's black.

I live in downtown Toronto. So it certainly piqued my interest to think of what I could be doing. I don't have an automatic car starter in my car. So part of me was like, phew, I don't have that. I know that there's many other ways they could get into the vehicle. And I've thought about things like the Apple AirTags. I was talking to the investigator, oh, maybe I could just slip one of those in my car. But they are actually easily identified.

They go around and they monitor where the AirTags are and they just throw them out the window. And as I was talking to John Dursey in the story, one of the things I never thought about if my vehicle was stolen, he got his car back. But there's also an emotional level to it. You get this car back. You know that someone else was in it. You're not entirely sure where it's been. It's been tampered with.

And so while you may get your exact vehicle back, maybe you don't want that vehicle back. And maybe you don't want that model anymore because you know that it's at high risk of being stolen again. And I've certainly heard from individuals after the story reaching out saying that it's not just one time it's happened. I've had individuals who told me three or four times they've had their luxury vehicles or SUVs stolen directly from their driveway. Claire, thank you so much for taking the time to speak with me today. Thanks for having me. That's it for today. I'm Mainika Raman-Wells.

Our summer producer is Nagin Nia. Our producers are Madeline White, Cheryl Sutherland, and Rachel Levy-McLaughlin. David Crosby edits the show. Adrienne Chung is our senior producer, and Angela Pachenza is our executive editor. Thanks so much for listening and I'll talk to you tomorrow.