Telematics in Brazil: Security for cars and cargo, part II
Unlike in Europe or the United States, where in recent years the main focus has been on safety, fleet management and infotainment, telematics in Brazil is still more or less about theft prevention. And for good reason. With some 400,000 vehicles stolen annually, one every 78 seconds, Brazil is one of the worst places on Earth to own a car.
The value of the vehicle or its cargo typically determines the tracking solution.
While it makes no sense to put satellite tracking on a container full of broom sticks with a total cost of approximately $5,000, it is money well spent on a container of Louis Vuitton bags, says Nishant Pillai, practice director for cargo and port security, Unisys Corporation, which has been advising Brazilian companies in areas of maritime and logistics management since 2003. “We always start with what is the total cost of ownership of the product someone is trying to track and trace,” he says.
There are plenty of different technologies to choose from. In fact, with its intense focus on theft prevention, Brazil has become something akin to a Petri dish for vehicle security, according to Roger Lanctot, associate director in the global automotive practice of Strategy Analytics.
Passive radio frequency identification (RFID) tags are used for low-cost cargo, active RFID for medium-cost cargo, and GPS/GPRS, satellite and radio frequency vehicle tracking technologies for high-value cargo and vehicles, both passenger and commercial. (For more on RFID and other tracking systems, see How telematics keeps cargo management on track and Telematics in Brazil: Ensuring security for cars and cargo.)
But a single solution is often not enough, and various technologies need to be combined to provide adequate protection.
RFID versus GSM/GPRS
Individual preferences vary. Ituran, for example, believes its proprietary radio frequency tracking technology is much better for vehicle tracking than GSM/GPRS, as it resists jamming and works, unlike GPS, in closed-in spaces, including underground garages.
Others install multiple units of the same design in the hopes that at least one of them will remain undetected by thieves. Satellite solutions are required to cover the enormous distances in Brazil.
Another factor in choosing the right tracking technology is how visible the client wants his assets/cargo to be, Pillai says. Is it check-in/check-out only? Is it checkpoint by checkpoint? Or is real-time or near-time visibility required?
It is also important to consider tracking both the tractor-trailer and the container, including the chassis it rides on, according to Pillai: “It’s a mistake to assume that you secure cargo by tracking the truck. Sometimes, people steal the truck and leave the cargo by the roadside, or they take the cargo and leave the truck.” (For more on cargo, see Special report: Fleet telematics.)
Last year, Unisys worked on securing exports of bauxite. Because the Volvo tractor-trailers used were expensive, it used a GPS tracking solution by Autotrac, a local leader in vehicle tracking. It used a combination of RFID tags, tamper-evident tape and e-seals on the containers. And because the end client demanded high visibility to make sure deliveries were moving through the pipeline as planned, a satellite-tracking module was added to monitor the shipments along their delivery route.
Staying ahead of the thieves
As any one of Brazil’s 300 to 400 vehicle-tracking companies will tell you, staying ahead of the thieves is a constant struggle. Three years ago, Ituran scored a coup by launching a battery-powered radio frequency tracking module that lasted five years on a single charge.
Having a source of power independent of the car’s electric circuit meant that the unit could be placed anywhere in the car and was thus better concealed from thieves looking to disable it. The problem turned out to be the module’s plastic casing, which still made it easy to remove once located.
And so last year, Ituran found a way to replace the plastic with solid metal and to weld it to the body of the car, making it much harder to remove. A second generation of the unit with an automatic notification system is now being tested. “This unit is much more active,” says Yaron Littan, CEO at Ituran Brazil, a leading vehicle tracking and theft prevention company. “Even if the client is not informing us, we are getting some signals that we can interpret as a breach of security and act.”
As many cars end up in chop shops, where they can be stripped of valuable parts in less than an hour, timing is of essence. (For more on tracking, see New telematics tech for fleet and asset management and Telematics and cargo: Cracking down on theft.)
Passive and active RFID
Other technologies have also been evolving. RFID tags are now available as a roll of tape that takes its unique signature from the way it is cut, according to Pillai. Passive RFID tape also comes with fluorescent ink that oozes out when the tape is torn.
In the active RFID space, frequency hopping and meshing is becoming more widely used, though interference remains a problem in busy places like ports. And high-penetration RFID readers are now capable of collecting data within a radius of up to 500 meters.
But technological advances can only go so far.
Seamless chain of custody is just as important as other preventive measures, such as background checks on everyone involved in the chain to prevent collusion with thieves, careful plotting of shipping routes, the use of geo-fencing to make sure the cargo stays within them, and the development of fast-response plans for times when something goes wrong.
In Brazil, this part of the job is often handled by one of more than a hundred risk management companies that operate with air traffic controller-like precision when it comes to monitoring assets and cargo along their routes.
Secure shipping documents
Secure transfer of shipping documents is also vital. At the moment, drivers in Brazil are required to carry a hard copy of cargo manifest when transporting goods, according to Pillai. This makes them easy prey.
With so much focus on theft prevention, other types of telematics services remain somewhat stunted in Brazil. “You don’t have an RDS-TMC network for traffic reporting, but then at the same time you have a license plate reading system and electronic tolling,” Lanctot says.
But things are starting to change. Remote vehicle diagnostics and driver and vehicle safety are becoming important to commercial fleet operators as they seek to control fuel costs and minimize accidents. And smartphones, though still underrepresented in Brazil, are getting Brazilians hooked on all kinds of mobile content that will eventually end up in cars. (For more on infotainment in Latin America, see Telematics in Latin America: Getting ready for infotainment.)
Cellular networks
But before that happens, the quality of cellular networks needs to significantly improve. “They don’t have enough wireless above ground, and below ground they don’t have enough fiber,” Lanctot says. In July, the Brazilian phone regulator Anatel went so far as to ban three major operators—Oi, TIM and Claro—from selling new cellphone plans until they committed to improve service.
Insurance companies will no doubt play an important role in the implementation of Contran 245 as they use lower insurance rates to attract new clients with cars featuring the new tracking and immobilization modules. As long as the drivers agree to be tracked, that is. While installation of the tracking module is mandatory, activation of tracking is up to the driver. (For more on Contran 245, see Telematics in Brazil and LATAM: Going beyond GPS and Telematics in Brazil: The law of the market.)
With only 1.5 million of Brazil’s more than 60 million vehicles tracked, there is plenty of room for growth. But there is also plenty of room for error. Lanctot expects a shakeout period when Contran 245 is finally implemented, “where they will learn in real time and very quickly what the shortcomings of the system are.” (For more on Brazil and LATAM, see Telematics opportunties in Brazil and LATAM, part I and Telematics opportuntiies in Brazil and LATAM, part II.)
Jan Stojaspal is a regular contributor to TU.
Read Telematics in Brazil: Security for cars and cargo, part I.
For more on the LATAM telematics market, see Special report: Telematics and emerging markets.
For more all the latest telematics trends in LATAM, check out Telematics Brazil & LATAM 2012 on Sept. 12-13 in Sao Paulo.
For all the latest telematics trends, check out Insurance Telematics USA 2012 in September in Chicago, Telematics Japan 2012 in October in Tokyo, Telematics Munich 2012 on October 29-30, and Content and Apps for Automotive USA 2012 on Dec. 4-5 in San Diego.
For exclusive telematics business analysis and insight, check out TU’s reports: In-Vehicle Smartphone Integration Report, Human Machine Interface Technologies and Smart Vehicle Technology: The Future of Insurance Telematics.
