SEMA News—May 2015

INTERNATIONAL
By Linda Spencer

Dynamic Off-Road Market in China

Media Giant FB Life Provides Insight

Off-roading is a popular pastime. Pictured here is a recent gathering hosted by FB Life which highlights the impressive size of this event and the mix between large-size pickups and SUVs as the vehicle of choice for these expeditions. The media/event organizers recently conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. The survey covers everything from average age, marital status, education, income and the number of vehicles owned.
SEMA members are invited to explore the Chinese market in the asso­ciation’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is avail­able at www.sema.org/china. Pictured here is Scotie Selman of Derive Systems at the 2014 event.

The specialty-equipment market in China is booming, with perhaps no sector growing more rapidly than the off-road market. SEMA News recently talked about the off-road scene with Baokun LV, co-founder of FBLife.com and executive general manager of FB Life, a Chinese media giant and a platform for off-road enthusiasts and service suppliers.

	The majority of vehicle owners are men, though nearly a one-fifth are women.
	About 60% have college educations, and 33% have post-college educations.
	About 79% earn at least $40,000 USD a year, and 30% of those surveyed brought home at least $80,000 a year.
	The majority of off-roading enthusiasts participating in FB Life events (71%) are between the ages of 26 and 45.
	The FB Life survey reported that 61% of respondents own two or three vehicles, with 22% owning more than three vehicles.

FB Life is known for its Chinese-language automotive online website. The company also sponsors driving tours, outdoor photography and scientific expeditions, and it hosts large-scale off-road events and races.

Most Popular Off-road Vehicles

The Jeep Wrangler and Grand Cherokee and the Japanese Toyota Land Cruiser series, including the LC 200 and LC 100, are the SUVs of choice for truck enthusiasts in China, but a growing number of Chinese have been purchasing fullsize pickups as the off-roading scene there evolves. LV estimated that these mostly large, U.S.-built pickups now make up 20% of the vehicles taking part in off-road events.

Ford F-Series trucks, Toyota Tundras and Dodge Rams have been spotted on FB Life tours. More recently, the more niche Nissan Patrol pickups and Escalade pickups have also made appearances. As for other trends, LV noted that bigger is better for a portion of the off-roading population. He said that his company is now also seeing some Super Duty pickups, including F-350s, F-450s and F-650s. As for small pickups, they are seen on off-road racing tracks, since the smaller and lighter trucks are good fits for racing.

Among the most popular vehicles for Chinese enthusiasts are the Ford F-Series and Toyota LC 71. The Raptor and Tundra are also extremely popular, but vehicle sales data provide only partial information, as virtually all of the large pickups used by consumers are brought in informally through the gray market and are not sold officially by the car manufacturers. These sales are not recorded in many of the available data, because the vehicles are purchased through dealers or third parties and then shipped to China.

Most Common Upgrades

FB Life hosts its largest annual event in the Gobi Desert in Inner Mongolia. The most common upgrades among those participating in the trips are functional items to enable enthusiasts to more fully master the terrain. The top two items LV mentioned were performance suspensions and bigger tires. Next on the list were gasoline tanks, luggage racks, bumpers, winches, headlights and auxiliary lights.

LV said that the perception among Chinese consumers regarding U.S. specialty-equipment products is very upscale and high quality.

“Chinese consumers have a special liking for U.S. specialty products,” he said. “I hope that American brands seize the opportunity now. I understand that American companies base their decisions on statistics, but this market is still in a gray area. That is why it is hard to get a hold of very accurate statistics now.”

He added that there is a strong need for additional U.S. products in China.

“I believe that the Chinese market is still in its baby stage,” he said. “We are witnessing more American companies coming to grow this market now. If American companies do not meet the needs, other companies will. Get your foothold when the market is still at its baby stage and come build your brands now. If you do not focus on this market now and perform excellent service to your customers, it will spoil your brands. Come wholeheartedly and build your brands slowly by performing good service to your customers.”

LV said that a new development is the growing competition from Chinese companies, which are also investing heavily in this market. For instance, Starworks and Topfire are growing very quickly.

LV conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. What follows are the results of his survey regarding, among other questions, their age, income, education, number of vehicles they own, etc.

Among the conclusions, the survey indicated that off-road enthusiasts typically own two or more vehicles, are well educated (60% have a college education and 33% a post-college education) and are well off.

Vehicle ownership is high among those responding to the FB Life survey. For instance, 61% reported owning two or three vehicles, and 22% said that they owned more than three vehicles. In contrast, and in a big change from previous surveys of consumers, only 6% reported that they didn’t own a vehicle.

SEMA members are invited to download the full survey, which is posted at www.sema.org/international.

SEMA members are also invited to explore the Chinese market in the association’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. With some distributors reporting 30% growth per year, now is an excellent time to exhibit in the SEMA section at the Shanghai-based China Auto Salon. Participants will meet with leading pre-vetted buyers from throughout China, visit local customizing shops and have access to vehicles popularly customized in the region but not sold in the United States. Limited slots and U.S. government subsidies to defray the costs are available for qualified companies. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is available at www.sema.org/china or by contacting Linda Spencer at lindas@sema.org.

SEMA News—May 2015

INTERNATIONAL
By Linda Spencer

Dynamic Off-Road Market in China

Media Giant FB Life Provides Insight

Off-roading is a popular pastime. Pictured here is a recent gathering hosted by FB Life which highlights the impressive size of this event and the mix between large-size pickups and SUVs as the vehicle of choice for these expeditions. The media/event organizers recently conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. The survey covers everything from average age, marital status, education, income and the number of vehicles owned.
SEMA members are invited to explore the Chinese market in the asso­ciation’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is avail­able at www.sema.org/china. Pictured here is Scotie Selman of Derive Systems at the 2014 event.

The specialty-equipment market in China is booming, with perhaps no sector growing more rapidly than the off-road market. SEMA News recently talked about the off-road scene with Baokun LV, co-founder of FBLife.com and executive general manager of FB Life, a Chinese media giant and a platform for off-road enthusiasts and service suppliers.

	The majority of vehicle owners are men, though nearly a one-fifth are women.
	About 60% have college educations, and 33% have post-college educations.
	About 79% earn at least $40,000 USD a year, and 30% of those surveyed brought home at least $80,000 a year.
	The majority of off-roading enthusiasts participating in FB Life events (71%) are between the ages of 26 and 45.
	The FB Life survey reported that 61% of respondents own two or three vehicles, with 22% owning more than three vehicles.

FB Life is known for its Chinese-language automotive online website. The company also sponsors driving tours, outdoor photography and scientific expeditions, and it hosts large-scale off-road events and races.

Most Popular Off-road Vehicles

The Jeep Wrangler and Grand Cherokee and the Japanese Toyota Land Cruiser series, including the LC 200 and LC 100, are the SUVs of choice for truck enthusiasts in China, but a growing number of Chinese have been purchasing fullsize pickups as the off-roading scene there evolves. LV estimated that these mostly large, U.S.-built pickups now make up 20% of the vehicles taking part in off-road events.

Ford F-Series trucks, Toyota Tundras and Dodge Rams have been spotted on FB Life tours. More recently, the more niche Nissan Patrol pickups and Escalade pickups have also made appearances. As for other trends, LV noted that bigger is better for a portion of the off-roading population. He said that his company is now also seeing some Super Duty pickups, including F-350s, F-450s and F-650s. As for small pickups, they are seen on off-road racing tracks, since the smaller and lighter trucks are good fits for racing.

Among the most popular vehicles for Chinese enthusiasts are the Ford F-Series and Toyota LC 71. The Raptor and Tundra are also extremely popular, but vehicle sales data provide only partial information, as virtually all of the large pickups used by consumers are brought in informally through the gray market and are not sold officially by the car manufacturers. These sales are not recorded in many of the available data, because the vehicles are purchased through dealers or third parties and then shipped to China.

Most Common Upgrades

FB Life hosts its largest annual event in the Gobi Desert in Inner Mongolia. The most common upgrades among those participating in the trips are functional items to enable enthusiasts to more fully master the terrain. The top two items LV mentioned were performance suspensions and bigger tires. Next on the list were gasoline tanks, luggage racks, bumpers, winches, headlights and auxiliary lights.

LV said that the perception among Chinese consumers regarding U.S. specialty-equipment products is very upscale and high quality.

“Chinese consumers have a special liking for U.S. specialty products,” he said. “I hope that American brands seize the opportunity now. I understand that American companies base their decisions on statistics, but this market is still in a gray area. That is why it is hard to get a hold of very accurate statistics now.”

He added that there is a strong need for additional U.S. products in China.

“I believe that the Chinese market is still in its baby stage,” he said. “We are witnessing more American companies coming to grow this market now. If American companies do not meet the needs, other companies will. Get your foothold when the market is still at its baby stage and come build your brands now. If you do not focus on this market now and perform excellent service to your customers, it will spoil your brands. Come wholeheartedly and build your brands slowly by performing good service to your customers.”

LV said that a new development is the growing competition from Chinese companies, which are also investing heavily in this market. For instance, Starworks and Topfire are growing very quickly.

LV conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. What follows are the results of his survey regarding, among other questions, their age, income, education, number of vehicles they own, etc.

Among the conclusions, the survey indicated that off-road enthusiasts typically own two or more vehicles, are well educated (60% have a college education and 33% a post-college education) and are well off.

Vehicle ownership is high among those responding to the FB Life survey. For instance, 61% reported owning two or three vehicles, and 22% said that they owned more than three vehicles. In contrast, and in a big change from previous surveys of consumers, only 6% reported that they didn’t own a vehicle.

SEMA members are invited to download the full survey, which is posted at www.sema.org/international.

SEMA members are also invited to explore the Chinese market in the association’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. With some distributors reporting 30% growth per year, now is an excellent time to exhibit in the SEMA section at the Shanghai-based China Auto Salon. Participants will meet with leading pre-vetted buyers from throughout China, visit local customizing shops and have access to vehicles popularly customized in the region but not sold in the United States. Limited slots and U.S. government subsidies to defray the costs are available for qualified companies. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is available at www.sema.org/china or by contacting Linda Spencer at lindas@sema.org.

SEMA News—May 2015

INTERNATIONAL
By Linda Spencer

Dynamic Off-Road Market in China

Media Giant FB Life Provides Insight

Off-roading is a popular pastime. Pictured here is a recent gathering hosted by FB Life which highlights the impressive size of this event and the mix between large-size pickups and SUVs as the vehicle of choice for these expeditions. The media/event organizers recently conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. The survey covers everything from average age, marital status, education, income and the number of vehicles owned.
SEMA members are invited to explore the Chinese market in the asso­ciation’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is avail­able at www.sema.org/china. Pictured here is Scotie Selman of Derive Systems at the 2014 event.

The specialty-equipment market in China is booming, with perhaps no sector growing more rapidly than the off-road market. SEMA News recently talked about the off-road scene with Baokun LV, co-founder of FBLife.com and executive general manager of FB Life, a Chinese media giant and a platform for off-road enthusiasts and service suppliers.

	The majority of vehicle owners are men, though nearly a one-fifth are women.
	About 60% have college educations, and 33% have post-college educations.
	About 79% earn at least $40,000 USD a year, and 30% of those surveyed brought home at least $80,000 a year.
	The majority of off-roading enthusiasts participating in FB Life events (71%) are between the ages of 26 and 45.
	The FB Life survey reported that 61% of respondents own two or three vehicles, with 22% owning more than three vehicles.

FB Life is known for its Chinese-language automotive online website. The company also sponsors driving tours, outdoor photography and scientific expeditions, and it hosts large-scale off-road events and races.

Most Popular Off-road Vehicles

The Jeep Wrangler and Grand Cherokee and the Japanese Toyota Land Cruiser series, including the LC 200 and LC 100, are the SUVs of choice for truck enthusiasts in China, but a growing number of Chinese have been purchasing fullsize pickups as the off-roading scene there evolves. LV estimated that these mostly large, U.S.-built pickups now make up 20% of the vehicles taking part in off-road events.

Ford F-Series trucks, Toyota Tundras and Dodge Rams have been spotted on FB Life tours. More recently, the more niche Nissan Patrol pickups and Escalade pickups have also made appearances. As for other trends, LV noted that bigger is better for a portion of the off-roading population. He said that his company is now also seeing some Super Duty pickups, including F-350s, F-450s and F-650s. As for small pickups, they are seen on off-road racing tracks, since the smaller and lighter trucks are good fits for racing.

Among the most popular vehicles for Chinese enthusiasts are the Ford F-Series and Toyota LC 71. The Raptor and Tundra are also extremely popular, but vehicle sales data provide only partial information, as virtually all of the large pickups used by consumers are brought in informally through the gray market and are not sold officially by the car manufacturers. These sales are not recorded in many of the available data, because the vehicles are purchased through dealers or third parties and then shipped to China.

Most Common Upgrades

FB Life hosts its largest annual event in the Gobi Desert in Inner Mongolia. The most common upgrades among those participating in the trips are functional items to enable enthusiasts to more fully master the terrain. The top two items LV mentioned were performance suspensions and bigger tires. Next on the list were gasoline tanks, luggage racks, bumpers, winches, headlights and auxiliary lights.

LV said that the perception among Chinese consumers regarding U.S. specialty-equipment products is very upscale and high quality.

“Chinese consumers have a special liking for U.S. specialty products,” he said. “I hope that American brands seize the opportunity now. I understand that American companies base their decisions on statistics, but this market is still in a gray area. That is why it is hard to get a hold of very accurate statistics now.”

He added that there is a strong need for additional U.S. products in China.

“I believe that the Chinese market is still in its baby stage,” he said. “We are witnessing more American companies coming to grow this market now. If American companies do not meet the needs, other companies will. Get your foothold when the market is still at its baby stage and come build your brands now. If you do not focus on this market now and perform excellent service to your customers, it will spoil your brands. Come wholeheartedly and build your brands slowly by performing good service to your customers.”

LV said that a new development is the growing competition from Chinese companies, which are also investing heavily in this market. For instance, Starworks and Topfire are growing very quickly.

LV conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. What follows are the results of his survey regarding, among other questions, their age, income, education, number of vehicles they own, etc.

Among the conclusions, the survey indicated that off-road enthusiasts typically own two or more vehicles, are well educated (60% have a college education and 33% a post-college education) and are well off.

Vehicle ownership is high among those responding to the FB Life survey. For instance, 61% reported owning two or three vehicles, and 22% said that they owned more than three vehicles. In contrast, and in a big change from previous surveys of consumers, only 6% reported that they didn’t own a vehicle.

SEMA members are invited to download the full survey, which is posted at www.sema.org/international.

SEMA members are also invited to explore the Chinese market in the association’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. With some distributors reporting 30% growth per year, now is an excellent time to exhibit in the SEMA section at the Shanghai-based China Auto Salon. Participants will meet with leading pre-vetted buyers from throughout China, visit local customizing shops and have access to vehicles popularly customized in the region but not sold in the United States. Limited slots and U.S. government subsidies to defray the costs are available for qualified companies. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is available at www.sema.org/china or by contacting Linda Spencer at lindas@sema.org.

SEMA News—May 2015

INTERNATIONAL
By Linda Spencer

Dynamic Off-Road Market in China

Media Giant FB Life Provides Insight

Off-roading is a popular pastime. Pictured here is a recent gathering hosted by FB Life which highlights the impressive size of this event and the mix between large-size pickups and SUVs as the vehicle of choice for these expeditions. The media/event organizers recently conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. The survey covers everything from average age, marital status, education, income and the number of vehicles owned.
SEMA members are invited to explore the Chinese market in the asso­ciation’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is avail­able at www.sema.org/china. Pictured here is Scotie Selman of Derive Systems at the 2014 event.

The specialty-equipment market in China is booming, with perhaps no sector growing more rapidly than the off-road market. SEMA News recently talked about the off-road scene with Baokun LV, co-founder of FBLife.com and executive general manager of FB Life, a Chinese media giant and a platform for off-road enthusiasts and service suppliers.

	The majority of vehicle owners are men, though nearly a one-fifth are women.
	About 60% have college educations, and 33% have post-college educations.
	About 79% earn at least $40,000 USD a year, and 30% of those surveyed brought home at least $80,000 a year.
	The majority of off-roading enthusiasts participating in FB Life events (71%) are between the ages of 26 and 45.
	The FB Life survey reported that 61% of respondents own two or three vehicles, with 22% owning more than three vehicles.

FB Life is known for its Chinese-language automotive online website. The company also sponsors driving tours, outdoor photography and scientific expeditions, and it hosts large-scale off-road events and races.

Most Popular Off-road Vehicles

The Jeep Wrangler and Grand Cherokee and the Japanese Toyota Land Cruiser series, including the LC 200 and LC 100, are the SUVs of choice for truck enthusiasts in China, but a growing number of Chinese have been purchasing fullsize pickups as the off-roading scene there evolves. LV estimated that these mostly large, U.S.-built pickups now make up 20% of the vehicles taking part in off-road events.

Ford F-Series trucks, Toyota Tundras and Dodge Rams have been spotted on FB Life tours. More recently, the more niche Nissan Patrol pickups and Escalade pickups have also made appearances. As for other trends, LV noted that bigger is better for a portion of the off-roading population. He said that his company is now also seeing some Super Duty pickups, including F-350s, F-450s and F-650s. As for small pickups, they are seen on off-road racing tracks, since the smaller and lighter trucks are good fits for racing.

Among the most popular vehicles for Chinese enthusiasts are the Ford F-Series and Toyota LC 71. The Raptor and Tundra are also extremely popular, but vehicle sales data provide only partial information, as virtually all of the large pickups used by consumers are brought in informally through the gray market and are not sold officially by the car manufacturers. These sales are not recorded in many of the available data, because the vehicles are purchased through dealers or third parties and then shipped to China.

Most Common Upgrades

FB Life hosts its largest annual event in the Gobi Desert in Inner Mongolia. The most common upgrades among those participating in the trips are functional items to enable enthusiasts to more fully master the terrain. The top two items LV mentioned were performance suspensions and bigger tires. Next on the list were gasoline tanks, luggage racks, bumpers, winches, headlights and auxiliary lights.

LV said that the perception among Chinese consumers regarding U.S. specialty-equipment products is very upscale and high quality.

“Chinese consumers have a special liking for U.S. specialty products,” he said. “I hope that American brands seize the opportunity now. I understand that American companies base their decisions on statistics, but this market is still in a gray area. That is why it is hard to get a hold of very accurate statistics now.”

He added that there is a strong need for additional U.S. products in China.

“I believe that the Chinese market is still in its baby stage,” he said. “We are witnessing more American companies coming to grow this market now. If American companies do not meet the needs, other companies will. Get your foothold when the market is still at its baby stage and come build your brands now. If you do not focus on this market now and perform excellent service to your customers, it will spoil your brands. Come wholeheartedly and build your brands slowly by performing good service to your customers.”

LV said that a new development is the growing competition from Chinese companies, which are also investing heavily in this market. For instance, Starworks and Topfire are growing very quickly.

LV conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. What follows are the results of his survey regarding, among other questions, their age, income, education, number of vehicles they own, etc.

Among the conclusions, the survey indicated that off-road enthusiasts typically own two or more vehicles, are well educated (60% have a college education and 33% a post-college education) and are well off.

Vehicle ownership is high among those responding to the FB Life survey. For instance, 61% reported owning two or three vehicles, and 22% said that they owned more than three vehicles. In contrast, and in a big change from previous surveys of consumers, only 6% reported that they didn’t own a vehicle.

SEMA members are invited to download the full survey, which is posted at www.sema.org/international.

SEMA members are also invited to explore the Chinese market in the association’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. With some distributors reporting 30% growth per year, now is an excellent time to exhibit in the SEMA section at the Shanghai-based China Auto Salon. Participants will meet with leading pre-vetted buyers from throughout China, visit local customizing shops and have access to vehicles popularly customized in the region but not sold in the United States. Limited slots and U.S. government subsidies to defray the costs are available for qualified companies. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is available at www.sema.org/china or by contacting Linda Spencer at lindas@sema.org.

SEMA News—May 2015

INTERNATIONAL
By Linda Spencer

Dynamic Off-Road Market in China

Media Giant FB Life Provides Insight

Off-roading is a popular pastime. Pictured here is a recent gathering hosted by FB Life which highlights the impressive size of this event and the mix between large-size pickups and SUVs as the vehicle of choice for these expeditions. The media/event organizers recently conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. The survey covers everything from average age, marital status, education, income and the number of vehicles owned.
SEMA members are invited to explore the Chinese market in the asso­ciation’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is avail­able at www.sema.org/china. Pictured here is Scotie Selman of Derive Systems at the 2014 event.

The specialty-equipment market in China is booming, with perhaps no sector growing more rapidly than the off-road market. SEMA News recently talked about the off-road scene with Baokun LV, co-founder of FBLife.com and executive general manager of FB Life, a Chinese media giant and a platform for off-road enthusiasts and service suppliers.

	The majority of vehicle owners are men, though nearly a one-fifth are women.
	About 60% have college educations, and 33% have post-college educations.
	About 79% earn at least $40,000 USD a year, and 30% of those surveyed brought home at least $80,000 a year.
	The majority of off-roading enthusiasts participating in FB Life events (71%) are between the ages of 26 and 45.
	The FB Life survey reported that 61% of respondents own two or three vehicles, with 22% owning more than three vehicles.

FB Life is known for its Chinese-language automotive online website. The company also sponsors driving tours, outdoor photography and scientific expeditions, and it hosts large-scale off-road events and races.

Most Popular Off-road Vehicles

The Jeep Wrangler and Grand Cherokee and the Japanese Toyota Land Cruiser series, including the LC 200 and LC 100, are the SUVs of choice for truck enthusiasts in China, but a growing number of Chinese have been purchasing fullsize pickups as the off-roading scene there evolves. LV estimated that these mostly large, U.S.-built pickups now make up 20% of the vehicles taking part in off-road events.

Ford F-Series trucks, Toyota Tundras and Dodge Rams have been spotted on FB Life tours. More recently, the more niche Nissan Patrol pickups and Escalade pickups have also made appearances. As for other trends, LV noted that bigger is better for a portion of the off-roading population. He said that his company is now also seeing some Super Duty pickups, including F-350s, F-450s and F-650s. As for small pickups, they are seen on off-road racing tracks, since the smaller and lighter trucks are good fits for racing.

Among the most popular vehicles for Chinese enthusiasts are the Ford F-Series and Toyota LC 71. The Raptor and Tundra are also extremely popular, but vehicle sales data provide only partial information, as virtually all of the large pickups used by consumers are brought in informally through the gray market and are not sold officially by the car manufacturers. These sales are not recorded in many of the available data, because the vehicles are purchased through dealers or third parties and then shipped to China.

Most Common Upgrades

FB Life hosts its largest annual event in the Gobi Desert in Inner Mongolia. The most common upgrades among those participating in the trips are functional items to enable enthusiasts to more fully master the terrain. The top two items LV mentioned were performance suspensions and bigger tires. Next on the list were gasoline tanks, luggage racks, bumpers, winches, headlights and auxiliary lights.

LV said that the perception among Chinese consumers regarding U.S. specialty-equipment products is very upscale and high quality.

“Chinese consumers have a special liking for U.S. specialty products,” he said. “I hope that American brands seize the opportunity now. I understand that American companies base their decisions on statistics, but this market is still in a gray area. That is why it is hard to get a hold of very accurate statistics now.”

He added that there is a strong need for additional U.S. products in China.

“I believe that the Chinese market is still in its baby stage,” he said. “We are witnessing more American companies coming to grow this market now. If American companies do not meet the needs, other companies will. Get your foothold when the market is still at its baby stage and come build your brands now. If you do not focus on this market now and perform excellent service to your customers, it will spoil your brands. Come wholeheartedly and build your brands slowly by performing good service to your customers.”

LV said that a new development is the growing competition from Chinese companies, which are also investing heavily in this market. For instance, Starworks and Topfire are growing very quickly.

LV conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. What follows are the results of his survey regarding, among other questions, their age, income, education, number of vehicles they own, etc.

Among the conclusions, the survey indicated that off-road enthusiasts typically own two or more vehicles, are well educated (60% have a college education and 33% a post-college education) and are well off.

Vehicle ownership is high among those responding to the FB Life survey. For instance, 61% reported owning two or three vehicles, and 22% said that they owned more than three vehicles. In contrast, and in a big change from previous surveys of consumers, only 6% reported that they didn’t own a vehicle.

SEMA members are invited to download the full survey, which is posted at www.sema.org/international.

SEMA members are also invited to explore the Chinese market in the association’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. With some distributors reporting 30% growth per year, now is an excellent time to exhibit in the SEMA section at the Shanghai-based China Auto Salon. Participants will meet with leading pre-vetted buyers from throughout China, visit local customizing shops and have access to vehicles popularly customized in the region but not sold in the United States. Limited slots and U.S. government subsidies to defray the costs are available for qualified companies. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is available at www.sema.org/china or by contacting Linda Spencer at lindas@sema.org.

SEMA News—May 2015

INTERNATIONAL
By Linda Spencer

Dynamic Off-Road Market in China

Media Giant FB Life Provides Insight

Off-roading is a popular pastime. Pictured here is a recent gathering hosted by FB Life which highlights the impressive size of this event and the mix between large-size pickups and SUVs as the vehicle of choice for these expeditions. The media/event organizers recently conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. The survey covers everything from average age, marital status, education, income and the number of vehicles owned.
SEMA members are invited to explore the Chinese market in the asso­ciation’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is avail­able at www.sema.org/china. Pictured here is Scotie Selman of Derive Systems at the 2014 event.

The specialty-equipment market in China is booming, with perhaps no sector growing more rapidly than the off-road market. SEMA News recently talked about the off-road scene with Baokun LV, co-founder of FBLife.com and executive general manager of FB Life, a Chinese media giant and a platform for off-road enthusiasts and service suppliers.

	The majority of vehicle owners are men, though nearly a one-fifth are women.
	About 60% have college educations, and 33% have post-college educations.
	About 79% earn at least $40,000 USD a year, and 30% of those surveyed brought home at least $80,000 a year.
	The majority of off-roading enthusiasts participating in FB Life events (71%) are between the ages of 26 and 45.
	The FB Life survey reported that 61% of respondents own two or three vehicles, with 22% owning more than three vehicles.

FB Life is known for its Chinese-language automotive online website. The company also sponsors driving tours, outdoor photography and scientific expeditions, and it hosts large-scale off-road events and races.

Most Popular Off-road Vehicles

The Jeep Wrangler and Grand Cherokee and the Japanese Toyota Land Cruiser series, including the LC 200 and LC 100, are the SUVs of choice for truck enthusiasts in China, but a growing number of Chinese have been purchasing fullsize pickups as the off-roading scene there evolves. LV estimated that these mostly large, U.S.-built pickups now make up 20% of the vehicles taking part in off-road events.

Ford F-Series trucks, Toyota Tundras and Dodge Rams have been spotted on FB Life tours. More recently, the more niche Nissan Patrol pickups and Escalade pickups have also made appearances. As for other trends, LV noted that bigger is better for a portion of the off-roading population. He said that his company is now also seeing some Super Duty pickups, including F-350s, F-450s and F-650s. As for small pickups, they are seen on off-road racing tracks, since the smaller and lighter trucks are good fits for racing.

Among the most popular vehicles for Chinese enthusiasts are the Ford F-Series and Toyota LC 71. The Raptor and Tundra are also extremely popular, but vehicle sales data provide only partial information, as virtually all of the large pickups used by consumers are brought in informally through the gray market and are not sold officially by the car manufacturers. These sales are not recorded in many of the available data, because the vehicles are purchased through dealers or third parties and then shipped to China.

Most Common Upgrades

FB Life hosts its largest annual event in the Gobi Desert in Inner Mongolia. The most common upgrades among those participating in the trips are functional items to enable enthusiasts to more fully master the terrain. The top two items LV mentioned were performance suspensions and bigger tires. Next on the list were gasoline tanks, luggage racks, bumpers, winches, headlights and auxiliary lights.

LV said that the perception among Chinese consumers regarding U.S. specialty-equipment products is very upscale and high quality.

“Chinese consumers have a special liking for U.S. specialty products,” he said. “I hope that American brands seize the opportunity now. I understand that American companies base their decisions on statistics, but this market is still in a gray area. That is why it is hard to get a hold of very accurate statistics now.”

He added that there is a strong need for additional U.S. products in China.

“I believe that the Chinese market is still in its baby stage,” he said. “We are witnessing more American companies coming to grow this market now. If American companies do not meet the needs, other companies will. Get your foothold when the market is still at its baby stage and come build your brands now. If you do not focus on this market now and perform excellent service to your customers, it will spoil your brands. Come wholeheartedly and build your brands slowly by performing good service to your customers.”

LV said that a new development is the growing competition from Chinese companies, which are also investing heavily in this market. For instance, Starworks and Topfire are growing very quickly.

LV conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. What follows are the results of his survey regarding, among other questions, their age, income, education, number of vehicles they own, etc.

Among the conclusions, the survey indicated that off-road enthusiasts typically own two or more vehicles, are well educated (60% have a college education and 33% a post-college education) and are well off.

Vehicle ownership is high among those responding to the FB Life survey. For instance, 61% reported owning two or three vehicles, and 22% said that they owned more than three vehicles. In contrast, and in a big change from previous surveys of consumers, only 6% reported that they didn’t own a vehicle.

SEMA members are invited to download the full survey, which is posted at www.sema.org/international.

SEMA members are also invited to explore the Chinese market in the association’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. With some distributors reporting 30% growth per year, now is an excellent time to exhibit in the SEMA section at the Shanghai-based China Auto Salon. Participants will meet with leading pre-vetted buyers from throughout China, visit local customizing shops and have access to vehicles popularly customized in the region but not sold in the United States. Limited slots and U.S. government subsidies to defray the costs are available for qualified companies. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is available at www.sema.org/china or by contacting Linda Spencer at lindas@sema.org.

SEMA News—May 2015

INTERNATIONAL
By Linda Spencer

Dynamic Off-Road Market in China

Media Giant FB Life Provides Insight

Off-roading is a popular pastime. Pictured here is a recent gathering hosted by FB Life which highlights the impressive size of this event and the mix between large-size pickups and SUVs as the vehicle of choice for these expeditions. The media/event organizers recently conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. The survey covers everything from average age, marital status, education, income and the number of vehicles owned.
SEMA members are invited to explore the Chinese market in the asso­ciation’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is avail­able at www.sema.org/china. Pictured here is Scotie Selman of Derive Systems at the 2014 event.

The specialty-equipment market in China is booming, with perhaps no sector growing more rapidly than the off-road market. SEMA News recently talked about the off-road scene with Baokun LV, co-founder of FBLife.com and executive general manager of FB Life, a Chinese media giant and a platform for off-road enthusiasts and service suppliers.

	The majority of vehicle owners are men, though nearly a one-fifth are women.
	About 60% have college educations, and 33% have post-college educations.
	About 79% earn at least $40,000 USD a year, and 30% of those surveyed brought home at least $80,000 a year.
	The majority of off-roading enthusiasts participating in FB Life events (71%) are between the ages of 26 and 45.
	The FB Life survey reported that 61% of respondents own two or three vehicles, with 22% owning more than three vehicles.

FB Life is known for its Chinese-language automotive online website. The company also sponsors driving tours, outdoor photography and scientific expeditions, and it hosts large-scale off-road events and races.

Most Popular Off-road Vehicles

The Jeep Wrangler and Grand Cherokee and the Japanese Toyota Land Cruiser series, including the LC 200 and LC 100, are the SUVs of choice for truck enthusiasts in China, but a growing number of Chinese have been purchasing fullsize pickups as the off-roading scene there evolves. LV estimated that these mostly large, U.S.-built pickups now make up 20% of the vehicles taking part in off-road events.

Ford F-Series trucks, Toyota Tundras and Dodge Rams have been spotted on FB Life tours. More recently, the more niche Nissan Patrol pickups and Escalade pickups have also made appearances. As for other trends, LV noted that bigger is better for a portion of the off-roading population. He said that his company is now also seeing some Super Duty pickups, including F-350s, F-450s and F-650s. As for small pickups, they are seen on off-road racing tracks, since the smaller and lighter trucks are good fits for racing.

Among the most popular vehicles for Chinese enthusiasts are the Ford F-Series and Toyota LC 71. The Raptor and Tundra are also extremely popular, but vehicle sales data provide only partial information, as virtually all of the large pickups used by consumers are brought in informally through the gray market and are not sold officially by the car manufacturers. These sales are not recorded in many of the available data, because the vehicles are purchased through dealers or third parties and then shipped to China.

Most Common Upgrades

FB Life hosts its largest annual event in the Gobi Desert in Inner Mongolia. The most common upgrades among those participating in the trips are functional items to enable enthusiasts to more fully master the terrain. The top two items LV mentioned were performance suspensions and bigger tires. Next on the list were gasoline tanks, luggage racks, bumpers, winches, headlights and auxiliary lights.

LV said that the perception among Chinese consumers regarding U.S. specialty-equipment products is very upscale and high quality.

“Chinese consumers have a special liking for U.S. specialty products,” he said. “I hope that American brands seize the opportunity now. I understand that American companies base their decisions on statistics, but this market is still in a gray area. That is why it is hard to get a hold of very accurate statistics now.”

He added that there is a strong need for additional U.S. products in China.

“I believe that the Chinese market is still in its baby stage,” he said. “We are witnessing more American companies coming to grow this market now. If American companies do not meet the needs, other companies will. Get your foothold when the market is still at its baby stage and come build your brands now. If you do not focus on this market now and perform excellent service to your customers, it will spoil your brands. Come wholeheartedly and build your brands slowly by performing good service to your customers.”

LV said that a new development is the growing competition from Chinese companies, which are also investing heavily in this market. For instance, Starworks and Topfire are growing very quickly.

LV conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. What follows are the results of his survey regarding, among other questions, their age, income, education, number of vehicles they own, etc.

Among the conclusions, the survey indicated that off-road enthusiasts typically own two or more vehicles, are well educated (60% have a college education and 33% a post-college education) and are well off.

Vehicle ownership is high among those responding to the FB Life survey. For instance, 61% reported owning two or three vehicles, and 22% said that they owned more than three vehicles. In contrast, and in a big change from previous surveys of consumers, only 6% reported that they didn’t own a vehicle.

SEMA members are invited to download the full survey, which is posted at www.sema.org/international.

SEMA members are also invited to explore the Chinese market in the association’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. With some distributors reporting 30% growth per year, now is an excellent time to exhibit in the SEMA section at the Shanghai-based China Auto Salon. Participants will meet with leading pre-vetted buyers from throughout China, visit local customizing shops and have access to vehicles popularly customized in the region but not sold in the United States. Limited slots and U.S. government subsidies to defray the costs are available for qualified companies. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is available at www.sema.org/china or by contacting Linda Spencer at lindas@sema.org.

SEMA News—May 2015

INTERNET
By Joe Dysart

Ransomware

One Wrong Click and Hackers Encrypt All Your Files

IT security experts warn that there’s been a spike in the scourge of ransomware—malicious software that freezes a computer, encrypts all of its data and demands a ransom for the system’s restoration. Since February 2013, more than 600,000 victims worldwide have reportedly been infected with just one variant of the malware, CryptoWall, according to an October 2014 report released by Dell.

“This is the next generation of ransomware, and you can expect this new version to spread like wildfire,” said Stu Sjouwerman, CEO of KnowBe4, a firm that specializes in IT security awareness training for small- and medium-size businesses.

“Today’s threat actors are smarter than ever, morphing their attacks multiple times to achieve the goal of undermining existing security defenses,” agreed David Monahan, research director for Enterprise Management Associates, an IT security firm that tracks and secures against hackers targeting the trucking and logistics industry.

“Cybercrime knows no season, never sleeps and is the most profitable international crime,” added TK Keanini, CTO of IT security firm Lancope.

Essentially, cyber-crooks trigger the extortion scheme by slithering past a PC’s defenses and delivering software onto the computer that auto-encrypts every file on the hard drive. The malware also infects all of the external hard drives connected to the PC.

Generally, victims inadvertently download the software after they click on what looks like a legitimate banner ad. They can also pick up ransomware when they visit an infected website or click on an infected attachment on an e-mail, according to the Dell report.

	Newer variants of ransomware are popping up on mobile technologies, according to a report released by Christian Fredrickson, CEO of F-Secure.

Unfortunately, it’s easy to be tricked by such schemes, since the crooks often send ransomware-infected e-mails that carry innocuous titles such as “missed fax” or “voicemail,” according to the Dell report. When a user clicks to download the item, the ransomware immediately invades the PC, executes and begins encrypting all of the data on the system. Once encryption is complete, a message pops up on the victim’s PC screen informing the victim that there has been a hostile takeover of the machine and demanding a ransom.

Crooks often demand ransoms ranging from $200 to $2,000. It’s an amount that’s painful to pay but low enough for many companies to tolerate in the hopes that the ransomers will be true to their word and restore a machine once money exchanges hands, according to the Dell report.

Moreover, companies that put off paying a ransom—usually more than four to seven days—often face threats of being forced to pay even larger ransoms. In one case, a victim was forced to pay $10,000 for the release of encrypted files. All told, Dell estimates that $1.1 million in ransom was paid to thieves using just the CryptoWall variant during a six-month period in 2014.

Ironically, the advent of new digital currencies is helping promulgate the criminal activity. Ransomers often demand to be paid in Bitcoin, a web-based currency that can be easily—and anonymously—exchanged over the web.

And while ransomware is often associated with visiting sketchy areas of the web—the digital equivalent of stumbling into a bad neighborhood—the malware has also been found on some extremely high-profile websites. In October, for example, ransomware was found embedded in ads on a number highly trafficked websites that included Yahoo, Match.com and AOL, according to a report by Proofpoint, an IT security firm.

Using infected ads on those high-profile websites was a clever move, in that the thieves did not have to overcome the formidable security defenses of major websites such as Microsoft.com and Bing—or even the ad networks servicing those sites, according to the Proofpoint report. Instead, the crooks simply stole legitimate ads, infected them with ransomware payloads, and then fed those ads back into the ad networks used by the previously mentioned highly trafficked websites.

Many companies aware of the ransomware scourge and similar malware already have education programs in place that train employees how to detect and guard against the most common sources of ransomware. But the extortionists, who apparently have nothing better to do all day, are always finding ways to up the ante in the never-ending game of cat and mouse.

“For example, most people are aware that they should avoid clicking on executable files,” said KnowB4’s Sjouwerman. “However, seemingly innocuous documents such as Microsoft Word files can also be infected with malware. That’s why it’s essential for employees to be able to identify and avoid social-engineering red flags.”

Sadly, the nightmare of the takeover software is also evolving with the digital revolution. For example, newer variants of ransomware are popping up on mobile technologies, such as Android phones, according to an October report from IT security firm F-Secure. With the mobile technologies, the ransomware payload often comes in the form of apps for download, according to the F-Secure report.

Unfortunately, there is no way to completely safeguard any business against ransomware 24/7. But there are a number of deterrents that organizations can put in place, including these:

• Block executable files (such as .exe files) and compressed archives (such as .zip files) containing executable files before they reach a user’s inbox.
• Keep operating systems, browsers and browser plug-ins such as Java and Silverlight fully updated to prevent compromises resulting from exposure to ransomware. “Patch browsers as soon as possible, and keep the amount of plug-ins as low as you can,” said Sjouwerman. “This diminishes your attack surface.”
• Once infected, try disconnecting your network from the Internet. This move can sometimes temporarily neuter ransomware until it can be discovered and removed.
• Program hard drives on your computer network to prevent any unidentified user from modifying files.
• Regularly back up data with so-called “cold,” offline backup media that does not and has never been connected to the Internet. “Make regular backups and have a backup off-site as well,” said Sjouwerman. “Test your restore function regularly to make sure that your backups actually work.” Sjouwerman added that backups to locally connected, network-attached or cloud-based storage are not sufficient, since ransomware such as CryptoWall encrypts such files along with those found on your system’s primary hard drive.
• Be careful with any e-mail that comes with an attachment or link inside. “Think before you click,” said Sjouwerman. “Don’t open anything from someone unless you are expecting it. Hover over an e-mail address to make sure it’s from a valid domain, one you know and recognize.”
• Check out KnowB4’s free phishing test. Essentially, this test enables you to identify people in your employ who are prone to be duped by ransomware operators looking to sneak into your network via online ads, websites and e-mails.

You should also consider a pre-emptive employee-training service such as KnowB4. The company offers a security awareness training program designed by Kevin Mitnick, who is an internationally recognized computer security expert and has extensive experience in exposing the vulnerabilities of complex operating systems and telecommunications devices. He gained notoriety as a highly skilled operator who penetrated some of the most resilient computer systems ever developed. Today, he is renowned as an information security consultant and speaker and has authored three books, including The New York Times bestseller Ghost in the Wires.

Mitnick’s security awareness training program is interactive, web-based and includes case studies, live demonstration videos and short tests. An initial training session in the program runs 30–40 minutes.

“Our Internet security awareness training is designed to ensure that employees understand the mechanisms of spam, phishing, spear-phishing, malware and social engineering and are able to apply this knowledge on the job,” Mitnick said. “This allows organizations to create a ‘human firewall’ that actively works to prevent network security breaches.”

Included in the service are regularly scheduled phishing security tests performed by KnowB4, which keep employees on their toes. Employees duped by the simulated phishing attacks can receive instant remedial training under the program. Also featured is an admin console that provides before-and-after reports featuring instant graphs detailing the training’s efficacy.

“The threat posed by malware should not be underestimated, particularly considering that employees have consistently proven to be the weak link in companies’ Internet security efforts,” Mitnick said. “In most cases, their involvement is unintentional. They unknowingly allow access to corporate networks simply because they don’t know what to watch out for.”

For more information on protecting your firm from ransomware, check out:

• “Dealing With Ransomware” Podcast: From IT Security Firm Sophos
• Proofpoint’s Report on Ransomware on Major Sites Such as Microsoft.com
• F-Secure’s Threat Report

Joe Dysart is an Internet speaker and business consultant based in Manhattan.
joe@joedysart.com
www.joedysart.com

SEMA News—May 2015

INTERNET
By Joe Dysart

Ransomware

One Wrong Click and Hackers Encrypt All Your Files

IT security experts warn that there’s been a spike in the scourge of ransomware—malicious software that freezes a computer, encrypts all of its data and demands a ransom for the system’s restoration. Since February 2013, more than 600,000 victims worldwide have reportedly been infected with just one variant of the malware, CryptoWall, according to an October 2014 report released by Dell.

“This is the next generation of ransomware, and you can expect this new version to spread like wildfire,” said Stu Sjouwerman, CEO of KnowBe4, a firm that specializes in IT security awareness training for small- and medium-size businesses.

“Today’s threat actors are smarter than ever, morphing their attacks multiple times to achieve the goal of undermining existing security defenses,” agreed David Monahan, research director for Enterprise Management Associates, an IT security firm that tracks and secures against hackers targeting the trucking and logistics industry.

“Cybercrime knows no season, never sleeps and is the most profitable international crime,” added TK Keanini, CTO of IT security firm Lancope.

Essentially, cyber-crooks trigger the extortion scheme by slithering past a PC’s defenses and delivering software onto the computer that auto-encrypts every file on the hard drive. The malware also infects all of the external hard drives connected to the PC.

Generally, victims inadvertently download the software after they click on what looks like a legitimate banner ad. They can also pick up ransomware when they visit an infected website or click on an infected attachment on an e-mail, according to the Dell report.

	Newer variants of ransomware are popping up on mobile technologies, according to a report released by Christian Fredrickson, CEO of F-Secure.

Unfortunately, it’s easy to be tricked by such schemes, since the crooks often send ransomware-infected e-mails that carry innocuous titles such as “missed fax” or “voicemail,” according to the Dell report. When a user clicks to download the item, the ransomware immediately invades the PC, executes and begins encrypting all of the data on the system. Once encryption is complete, a message pops up on the victim’s PC screen informing the victim that there has been a hostile takeover of the machine and demanding a ransom.

Crooks often demand ransoms ranging from $200 to $2,000. It’s an amount that’s painful to pay but low enough for many companies to tolerate in the hopes that the ransomers will be true to their word and restore a machine once money exchanges hands, according to the Dell report.

Moreover, companies that put off paying a ransom—usually more than four to seven days—often face threats of being forced to pay even larger ransoms. In one case, a victim was forced to pay $10,000 for the release of encrypted files. All told, Dell estimates that $1.1 million in ransom was paid to thieves using just the CryptoWall variant during a six-month period in 2014.

Ironically, the advent of new digital currencies is helping promulgate the criminal activity. Ransomers often demand to be paid in Bitcoin, a web-based currency that can be easily—and anonymously—exchanged over the web.

And while ransomware is often associated with visiting sketchy areas of the web—the digital equivalent of stumbling into a bad neighborhood—the malware has also been found on some extremely high-profile websites. In October, for example, ransomware was found embedded in ads on a number highly trafficked websites that included Yahoo, Match.com and AOL, according to a report by Proofpoint, an IT security firm.

Using infected ads on those high-profile websites was a clever move, in that the thieves did not have to overcome the formidable security defenses of major websites such as Microsoft.com and Bing—or even the ad networks servicing those sites, according to the Proofpoint report. Instead, the crooks simply stole legitimate ads, infected them with ransomware payloads, and then fed those ads back into the ad networks used by the previously mentioned highly trafficked websites.

Many companies aware of the ransomware scourge and similar malware already have education programs in place that train employees how to detect and guard against the most common sources of ransomware. But the extortionists, who apparently have nothing better to do all day, are always finding ways to up the ante in the never-ending game of cat and mouse.

“For example, most people are aware that they should avoid clicking on executable files,” said KnowB4’s Sjouwerman. “However, seemingly innocuous documents such as Microsoft Word files can also be infected with malware. That’s why it’s essential for employees to be able to identify and avoid social-engineering red flags.”

Sadly, the nightmare of the takeover software is also evolving with the digital revolution. For example, newer variants of ransomware are popping up on mobile technologies, such as Android phones, according to an October report from IT security firm F-Secure. With the mobile technologies, the ransomware payload often comes in the form of apps for download, according to the F-Secure report.

Unfortunately, there is no way to completely safeguard any business against ransomware 24/7. But there are a number of deterrents that organizations can put in place, including these:

• Block executable files (such as .exe files) and compressed archives (such as .zip files) containing executable files before they reach a user’s inbox.
• Keep operating systems, browsers and browser plug-ins such as Java and Silverlight fully updated to prevent compromises resulting from exposure to ransomware. “Patch browsers as soon as possible, and keep the amount of plug-ins as low as you can,” said Sjouwerman. “This diminishes your attack surface.”
• Once infected, try disconnecting your network from the Internet. This move can sometimes temporarily neuter ransomware until it can be discovered and removed.
• Program hard drives on your computer network to prevent any unidentified user from modifying files.
• Regularly back up data with so-called “cold,” offline backup media that does not and has never been connected to the Internet. “Make regular backups and have a backup off-site as well,” said Sjouwerman. “Test your restore function regularly to make sure that your backups actually work.” Sjouwerman added that backups to locally connected, network-attached or cloud-based storage are not sufficient, since ransomware such as CryptoWall encrypts such files along with those found on your system’s primary hard drive.
• Be careful with any e-mail that comes with an attachment or link inside. “Think before you click,” said Sjouwerman. “Don’t open anything from someone unless you are expecting it. Hover over an e-mail address to make sure it’s from a valid domain, one you know and recognize.”
• Check out KnowB4’s free phishing test. Essentially, this test enables you to identify people in your employ who are prone to be duped by ransomware operators looking to sneak into your network via online ads, websites and e-mails.

You should also consider a pre-emptive employee-training service such as KnowB4. The company offers a security awareness training program designed by Kevin Mitnick, who is an internationally recognized computer security expert and has extensive experience in exposing the vulnerabilities of complex operating systems and telecommunications devices. He gained notoriety as a highly skilled operator who penetrated some of the most resilient computer systems ever developed. Today, he is renowned as an information security consultant and speaker and has authored three books, including The New York Times bestseller Ghost in the Wires.

Mitnick’s security awareness training program is interactive, web-based and includes case studies, live demonstration videos and short tests. An initial training session in the program runs 30–40 minutes.

“Our Internet security awareness training is designed to ensure that employees understand the mechanisms of spam, phishing, spear-phishing, malware and social engineering and are able to apply this knowledge on the job,” Mitnick said. “This allows organizations to create a ‘human firewall’ that actively works to prevent network security breaches.”

Included in the service are regularly scheduled phishing security tests performed by KnowB4, which keep employees on their toes. Employees duped by the simulated phishing attacks can receive instant remedial training under the program. Also featured is an admin console that provides before-and-after reports featuring instant graphs detailing the training’s efficacy.

“The threat posed by malware should not be underestimated, particularly considering that employees have consistently proven to be the weak link in companies’ Internet security efforts,” Mitnick said. “In most cases, their involvement is unintentional. They unknowingly allow access to corporate networks simply because they don’t know what to watch out for.”

For more information on protecting your firm from ransomware, check out:

• “Dealing With Ransomware” Podcast: From IT Security Firm Sophos
• Proofpoint’s Report on Ransomware on Major Sites Such as Microsoft.com
• F-Secure’s Threat Report

Joe Dysart is an Internet speaker and business consultant based in Manhattan.
joe@joedysart.com
www.joedysart.com

SEMA News—May 2015

INTERNET
By Joe Dysart

Ransomware

One Wrong Click and Hackers Encrypt All Your Files

IT security experts warn that there’s been a spike in the scourge of ransomware—malicious software that freezes a computer, encrypts all of its data and demands a ransom for the system’s restoration. Since February 2013, more than 600,000 victims worldwide have reportedly been infected with just one variant of the malware, CryptoWall, according to an October 2014 report released by Dell.

“This is the next generation of ransomware, and you can expect this new version to spread like wildfire,” said Stu Sjouwerman, CEO of KnowBe4, a firm that specializes in IT security awareness training for small- and medium-size businesses.

“Today’s threat actors are smarter than ever, morphing their attacks multiple times to achieve the goal of undermining existing security defenses,” agreed David Monahan, research director for Enterprise Management Associates, an IT security firm that tracks and secures against hackers targeting the trucking and logistics industry.

“Cybercrime knows no season, never sleeps and is the most profitable international crime,” added TK Keanini, CTO of IT security firm Lancope.

Essentially, cyber-crooks trigger the extortion scheme by slithering past a PC’s defenses and delivering software onto the computer that auto-encrypts every file on the hard drive. The malware also infects all of the external hard drives connected to the PC.

Generally, victims inadvertently download the software after they click on what looks like a legitimate banner ad. They can also pick up ransomware when they visit an infected website or click on an infected attachment on an e-mail, according to the Dell report.

	Newer variants of ransomware are popping up on mobile technologies, according to a report released by Christian Fredrickson, CEO of F-Secure.

Unfortunately, it’s easy to be tricked by such schemes, since the crooks often send ransomware-infected e-mails that carry innocuous titles such as “missed fax” or “voicemail,” according to the Dell report. When a user clicks to download the item, the ransomware immediately invades the PC, executes and begins encrypting all of the data on the system. Once encryption is complete, a message pops up on the victim’s PC screen informing the victim that there has been a hostile takeover of the machine and demanding a ransom.

Crooks often demand ransoms ranging from $200 to $2,000. It’s an amount that’s painful to pay but low enough for many companies to tolerate in the hopes that the ransomers will be true to their word and restore a machine once money exchanges hands, according to the Dell report.

Moreover, companies that put off paying a ransom—usually more than four to seven days—often face threats of being forced to pay even larger ransoms. In one case, a victim was forced to pay $10,000 for the release of encrypted files. All told, Dell estimates that $1.1 million in ransom was paid to thieves using just the CryptoWall variant during a six-month period in 2014.

Ironically, the advent of new digital currencies is helping promulgate the criminal activity. Ransomers often demand to be paid in Bitcoin, a web-based currency that can be easily—and anonymously—exchanged over the web.

And while ransomware is often associated with visiting sketchy areas of the web—the digital equivalent of stumbling into a bad neighborhood—the malware has also been found on some extremely high-profile websites. In October, for example, ransomware was found embedded in ads on a number highly trafficked websites that included Yahoo, Match.com and AOL, according to a report by Proofpoint, an IT security firm.

Using infected ads on those high-profile websites was a clever move, in that the thieves did not have to overcome the formidable security defenses of major websites such as Microsoft.com and Bing—or even the ad networks servicing those sites, according to the Proofpoint report. Instead, the crooks simply stole legitimate ads, infected them with ransomware payloads, and then fed those ads back into the ad networks used by the previously mentioned highly trafficked websites.

Many companies aware of the ransomware scourge and similar malware already have education programs in place that train employees how to detect and guard against the most common sources of ransomware. But the extortionists, who apparently have nothing better to do all day, are always finding ways to up the ante in the never-ending game of cat and mouse.

“For example, most people are aware that they should avoid clicking on executable files,” said KnowB4’s Sjouwerman. “However, seemingly innocuous documents such as Microsoft Word files can also be infected with malware. That’s why it’s essential for employees to be able to identify and avoid social-engineering red flags.”

Sadly, the nightmare of the takeover software is also evolving with the digital revolution. For example, newer variants of ransomware are popping up on mobile technologies, such as Android phones, according to an October report from IT security firm F-Secure. With the mobile technologies, the ransomware payload often comes in the form of apps for download, according to the F-Secure report.

Unfortunately, there is no way to completely safeguard any business against ransomware 24/7. But there are a number of deterrents that organizations can put in place, including these:

• Block executable files (such as .exe files) and compressed archives (such as .zip files) containing executable files before they reach a user’s inbox.
• Keep operating systems, browsers and browser plug-ins such as Java and Silverlight fully updated to prevent compromises resulting from exposure to ransomware. “Patch browsers as soon as possible, and keep the amount of plug-ins as low as you can,” said Sjouwerman. “This diminishes your attack surface.”
• Once infected, try disconnecting your network from the Internet. This move can sometimes temporarily neuter ransomware until it can be discovered and removed.
• Program hard drives on your computer network to prevent any unidentified user from modifying files.
• Regularly back up data with so-called “cold,” offline backup media that does not and has never been connected to the Internet. “Make regular backups and have a backup off-site as well,” said Sjouwerman. “Test your restore function regularly to make sure that your backups actually work.” Sjouwerman added that backups to locally connected, network-attached or cloud-based storage are not sufficient, since ransomware such as CryptoWall encrypts such files along with those found on your system’s primary hard drive.
• Be careful with any e-mail that comes with an attachment or link inside. “Think before you click,” said Sjouwerman. “Don’t open anything from someone unless you are expecting it. Hover over an e-mail address to make sure it’s from a valid domain, one you know and recognize.”
• Check out KnowB4’s free phishing test. Essentially, this test enables you to identify people in your employ who are prone to be duped by ransomware operators looking to sneak into your network via online ads, websites and e-mails.

You should also consider a pre-emptive employee-training service such as KnowB4. The company offers a security awareness training program designed by Kevin Mitnick, who is an internationally recognized computer security expert and has extensive experience in exposing the vulnerabilities of complex operating systems and telecommunications devices. He gained notoriety as a highly skilled operator who penetrated some of the most resilient computer systems ever developed. Today, he is renowned as an information security consultant and speaker and has authored three books, including The New York Times bestseller Ghost in the Wires.

Mitnick’s security awareness training program is interactive, web-based and includes case studies, live demonstration videos and short tests. An initial training session in the program runs 30–40 minutes.

“Our Internet security awareness training is designed to ensure that employees understand the mechanisms of spam, phishing, spear-phishing, malware and social engineering and are able to apply this knowledge on the job,” Mitnick said. “This allows organizations to create a ‘human firewall’ that actively works to prevent network security breaches.”

Included in the service are regularly scheduled phishing security tests performed by KnowB4, which keep employees on their toes. Employees duped by the simulated phishing attacks can receive instant remedial training under the program. Also featured is an admin console that provides before-and-after reports featuring instant graphs detailing the training’s efficacy.

“The threat posed by malware should not be underestimated, particularly considering that employees have consistently proven to be the weak link in companies’ Internet security efforts,” Mitnick said. “In most cases, their involvement is unintentional. They unknowingly allow access to corporate networks simply because they don’t know what to watch out for.”

For more information on protecting your firm from ransomware, check out:

• “Dealing With Ransomware” Podcast: From IT Security Firm Sophos
• Proofpoint’s Report on Ransomware on Major Sites Such as Microsoft.com
• F-Secure’s Threat Report

Joe Dysart is an Internet speaker and business consultant based in Manhattan.
joe@joedysart.com
www.joedysart.com