Lojack for Motorcycles Addresses Growing Risk

With summer right around the bend, motorcycle enthusiasts across the nation are gearing up to hit the road. In recent years, the popularity of motorcycle riding has risen to a zenith rivaling that of the Easy Rider days of the 1970s. Unfortunately, thieves have taken advantage of the fad, driving theft rates up 55 percent from 2002-2003, according to the National Insurance Crime Bureau.

“Bikes are easy to steal,” said Paul McMahon, director of corporate communications for Lojack Corp. “You don’t even need a key. Just roll it into the back of a van and drive off … The latest theft trend that we have found is that these thieves are stealing mom’s minivan, if you will, ripping the seats out, rolling bikes into the back and stealing them as well”–a two-for-one deal.

Motorcycle thieves are apparently becoming very resourceful in using every part for resale or reconstruction. Plus, the parts can be altered or reused more easily than truck or car parts, resulting in a lower recovery rate for stolen cycles than vehicles, approximately 25 to 30 percent versus 60 to 75 percent. Additionally, motorcycles are highly sought-after luxury items in foreign countries, fostering a lucrative export market here in the United States.

To address this growing risk, Massachusetts-based Lojack Corp. is offering a tracking device for stolen motorcycles, a translation of its current technology used for tracking and recovering valuable mobile assets such as cars, trucks and construction equipment.

“We believe this is the right product at the right time,” said Joseph Abely, chief executive officer, Lojack Corp. “Bike theft is climbing at an alarming rate and there is a lack of effective protection solutions available to consumers.”

Directly integrated with law enforcement agencies, the system is mainly used in high population areas across the United States. The system works through installation of a small radio transceiver in a hidden location on the motorcycle. If the bike is stolen, authorities can link to the Lojack database, match the vehicle identification number and activate silent radio signals from the transceiver. Tracking computers installed in police vehicles, helicopters and fixed-wing aircraft can then locate where the signals are coming from.

“Lojack is good old-fashioned [radio frequency] technology that has been around since World War II,” McMahon said. “It’s particularly appropriate technology for stolen vehicle recovery, unlike satellite technology for example which needs a clear line of sight. It’s also a covert technology because there are no visible antennas required.”

Claiming a 90 percent success rate in recovering stolen cars, Lojack calculates that it has aided in the recovery of more than $2 billion in global assets. “We jumped in the commercial market in 1998 and have had quite a bit of success helping recover stolen equipment. Motorcycles are just another step,” McMahon said.

Massachusetts, Rhode Island, New York and New Jersey have mandated discounts on auto insurance policies for owners of after market anti-theft devices. In Massachusetts, it’s up to 35 percent off comprehensive coverage for owners of a Lojack system. Although the motorcycle system is in its infancy stage, there is already a state mandate in Massachusetts for a 20 percent discount off comprehensive coverage. Some insurance companies have begun offering to offer such discounts. Liberty Mutual, for one, offers discounts nationwide.

A spokesperson for Seattle-based Safeco Insurance explained that in states where stolen vehicle recovery systems are recognized, his company takes one of two approaches. “Most commonly we offer a discount on a customers’ comprehensive coverage, or we waive the deductible if the car is stolen.” The usage and loss data regarding these types of systems is too thin to determine whether they control claims costs, he added, but “because most law enforcement organizations believe the systems make a difference, [they] recognize them in their underwriting.”

Lojack uses a very specific channel on the radio frequency bandwidth and operates with law enforcement in areas of the country with the most population density and, consequently the most vehicles and theft. “If you live in upstate Maine and you don’t lock your front door, car theft is probably not a major problem,” McMahon said. In this respect, it’s likely to be inefficient to have Lojack’s tracking equipment sitting on the dashboard of small-town police cruisers.

Lojack’s motorcycle product is being rolled out on a market-to-market basis where theft rates are highest. It is currently available at certified franchise dealers in Massachusetts and the greater Miami/Fort Lauderdale area. Texas and California markets are said to be joining later in 2005. The manufacturer’s suggested retail price is $595 as a one-time installation fee. The system comes with a limited two-year warranty including a money-back guarantee if a stolen motorcycle is not recovered within a 24-hour period.