Tuesday, November 08, 2005

Most Stolen Cars

Beyond the graphs and equations, economics is essentially a study of incentives. The CNN article lists the top ten vehicles stolen during 2004. The most striking fact about the top ten list is that only one moderately new vehicle, the 2003 Dodge Ram pick-up, made the list. Nine out of ten of the cars are models older than 1997.

The economist in you should ask, "If a thief is going to risk going to jail for stealing a car, why is he more likely to steal a 1995 Honda Civic rather than a 2005 BMW 3 Series?"

The article lists two primary reasons that raise the chances of a vehicle getting stolen: popularity and longevity. The popularity argument says that if a lot of people drive Honda Civics, then there are more of them to steal. The longevity argument says that if people who drive Honda Civics tend to drive them for a long time, then there is a demand for replacement parts.

So it appears that stealing a 1995 Honda Civic is more profitable than a 2005 BMW 3 Series because there is greater demand for replacement parts for an old Civic than a new BMW. Can you think of another reason why old cars are stolen more often than new cars?

An owner of a 1995 Honda Civic is less likely to buy expensive anti-theft equipment for the car because he can't afford it or he doesn't believe it's worth it given the price of an old Civic. An owner of a 2005 BMW 3 Series is more likely to buy expensive anti-theft equipment for the car because he can afford it or he believes it's worth protecting his "valuable" investment.

So from a thief's perspective, stealing a 1995 Honda Civic is more convenient (lots of them around), profitable (high demand for parts), and easy (old and low priced cars do not usually have sophisticated anti-theft systems).

Here is some food for thought:

1. Assume a buyer has perfect information about how likely old Honda Civics get stolen. Does this increase or decrease the demand for NEW models like the 2006 Honda Civic?

2. If you believe that the probability of your new car getting stolen increases as it gets older, do you have more or less of an incentive to sell it after a few years of owning the car?

3. The list of most-stolen vehicles lists 4 pick-up trucks. Are the incentives for stealing a pick-up truck the same as the incentives for stealing a sedan or coupe? For example, what explains the fact that the 1994 Dodge Caravan (low MSRP) gets stolen more often than a 1990 Acura Integra (high MSRP)?

Keywords: Risk and reward, Incentives


  • At 11:23 PM, March 28, 2006, Blogger Dave Moglen said…

    I could be biased having just bought an '06 Civic and having found your article on a google search for most stolen vehicles, but I'm also an Aplia instructor. The 1st question seems like you could use two conflicting logic sets, both dependent on the buyers' perception of security improvements. If they think few have been made, they don't buy. If they think the '06 is much more secure than the '95, they buy. If the security is basically the same and ease of theft unchanged, why wouldn't new models top the list rather than the '95? Can we really think the gap between where the '95 Civic falls on the list and where the '05 or '06 falls is fully attributable to security upgrades more affluent buyers made? And if not, there must be some combination of perception and reailty that the '06 is harder to steal.

  • At 10:09 AM, March 29, 2006, Blogger Chris Makler said…

    Dave makes a good point, but the main issue here isn't the ease of theft--it's the probability of theft as a function of the demand for parts. The fact that there are so many Civics means that as they age, there's a greater demand for parts; this raises the price of used Civic parts and provides incentives for thieves.

    Using this logic, it's easy to answer Dave's question:

    "If the security is basically the same and ease of theft unchanged, why wouldn't new models top the list rather than the '95?"

    The reason is that the demand for used '06 parts is very small, since new cars don't need many replacement parts and are generally under warranty in any case, whereas the demand for '95 parts is large.

  • At 3:34 PM, August 11, 2006, Blogger William Chiu said…

    The NICB top ten list—the number in parentheses is the model year most stolen:

    1. Honda Civic (1995)
    2. Toyota Camry (1989)
    3. Honda Accord (1991)
    4. Dodge Caravan (1994)
    5. Chevrolet C/K 1500 (1994)
    6. Ford F-150 (1997)
    7. Dodge Ram Pickup (2003)
    8. Acura Integra (1990)
    9. Toyota Pickup (1988)
    10. Nissan Sentra (1991)

    Source: http://autos.msn.com/advice/article.aspx?contentid=2891

  • At 9:39 PM, January 23, 2007, Blogger Erik said…

    I know this is a ridiculously old post and therefore my comment is nearly useless, but I feel it is necessary to point out that many new cars come with an electronic immobilizer that shuts down one or more engine components when someone breaks into the car. For instance, I own an '06 civic si, and if you break into it, the fuelpump disengages and the car will not start. In order to re-engage the fuel pump you must have a master key which tells the car that everything is okay and re-engages the fuel pump.
    Systems like this are hard to get to, they are located in the engine bay and could look like nothing more than a couple of regular auto wires. If someone was to simply mess with them, the chances that the car would start without someone repairing some part of the system is very low.
    I'm not saying that these cars are unstealable- but they are certainly much harder to steal than a 95 civic EX, which tops the US list.
    Research in Canada (link below)

    suggests that cars with electronic immobilization systems are rarely stolen- the first car on their list of stolen vehicles with an electronic immobilizer is #28, an Audi Quattro.
    Although Chris probably has the right of it when he says that parts are the main reason people steal cars, I don't believe that it is because people are concerned with stealing and reselling regular-old used parts. the odds of someone's "riced up" civic being stolen are much higher than my next-door neighbor's POS LX, the reason being that modified cars are going to have highly resellable aftermarket parts on them. If you were to look at ebay, I would bet that you would find many more listings for used Greddy, AEM, DC Sports, and the like than you would stock parts.
    The above statement is exactly why Honda Civics are, and have been the most stolen car for a long time.
    Then- another reason that cars are stolen is that they are incredibly common. If you look at the US list of stolen cars, you'll probably realize that many of these cars you see on a daily basis. I know that when I am driving around, I see lots and lots of the cars on this list. When there are three hundred cars just like yours (maybe with a different color) driving around every single day in the same areas, the same neighborhoods, it makes it very unlikely that your car will be found.
    The only thing that I wonder is why the Ford Mustang isn't in the top ten list.

  • At 9:42 PM, January 23, 2007, Blogger Erik said…

    sorry. apparently the whole text was not included the first time. If anyone is actually interested in reading it, I've re-pasted it below.



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