AT 8am the wait was over. The detectives were standing ready to strike and when the signal came they moved quickly, swarming through the residential streets in a series of simultaneous raids on homes in the Perth suburbs of East Cannington, Bedford and West Perth.

Gutted and junked: The shell of a car that has been stripped and dumped by a rebirthing gang They found what had the neighbours worried, front yards full of twisted car wrecks. The perpetrators had done little to disguise their operations.

"There were vehicles parked everywhere. In the garden, up the driveways, in the street out the front," says Detective Senior Sergeant Neville Dockery, officer in charge of the West Australian police motor squad.

Seven people were charged as a result of the raids on Wednesday last week and police seized about 40 cars. Most of the cars were family sedans allegedly either damaged or stolen in NSW. They'd been trucked to Perth and repaired with stolen parts ready for sale to unsuspecting buyers.

The operation was the result of other raids in Sydney a week earlier, in which riot police and detectives from the NSW Middle Eastern organised crime squad arrested six men for allegedly stealing cars from the city's affluent eastern suburbs.

These arrests, almost 4000km apart, demonstrate the national scale of what investigators call the criminal car rebirthing industry, where cars are stolen to order. The cars' identities are then disguised or they are stripped of parts to repair legitimate wrecks.

While the number of car and light-commercial vehicle thefts nationwide has fallen dramatically since 2000, rebirthing is on the rise and proving fiercely resistant to police efforts to stamp it out.

According to police, traditionally most were stolen for joyriding. But improved security, including the mandatory installation of engine immobilisers on all new cars since 2001, has cut joyriding and thefts overall.

According to industry and government figures, there were more than 127,000 thefts across Australia in 2000. Since then, that number has almost halved, to a 30-year low of about 64,000 last year.

But dig deeper into these figures and you find this collapse is disguising a worrying trend. In 2000, there were 15,000 unrecovered stolen cars: those that were stolen and disappeared. Six years later, this number is down only slightly, to 13,200.

As a proportion of total thefts, the rate of unrecovered vehicles has increased during this time. In 2000, one in eight stolen vehicles disappeared. Last year it was one in five.

According to Detective Superintendent Nick Bingham, commander of the NSW police property crime squad, the number of unrecovered thefts indicates the grand scale of car rebirthing. "It's a constant problem," he says. "Whenever police act to circumvent it, the criminals come up with innovative ways to get around us."

Analysis by the University of Western Sydney, presented at an international conference on vehicle crime in Melbourne last month, suggests that of the 13,200 unrecovered vehicles last year, 50 per cent were dumped in bushland, most likely after joyriding; about 20 per cent were rebirthed; and almost 30 per cent were stripped for parts. A small percentage of the total were illegally exported to the Middle East, the data showed.

In WA, police believe the rebirthing syndicate nabbed last week had sold about 40 cars to unsuspecting buyers through weekend newspaper advertisements.

For the criminals, rebirthing is a lucrative source of funding. The most popular cars are also those that dominate the legitimate market - Holden Commodores and Ford Falcons - but rebirthing gangs also specifically target luxury models, which provide greater financial return. "It is organised crime," Bingham says. "The syndicates or individuals prepared to do the rebirthing are the same people who do drug supply, who do prostitution, armed robberies, fraud."

Police say that during the past five years the car rebirthing business has changed. Once criminals would buy a wrecked car, typically the result of a road accident, then find and steal a matching make and model from the street. By transferring a few details, crucially the 17-digit vehicle identification number located on the chassis, they could disguise the identity of the stolen car by re-registering it with the identity of the wreck. Even if the result was recovered by police, it was almost impossible to trace the vehicle's true owner.

Since the introduction of the Written-off Vehicle Register in 2002, however, statutory write-offs - those vehicles that are physically beyond repair as opposed to those written off by an insurance company but which can be repaired - cannot be re-registered in Australia.

Police say this has effectively killed the traditional rebirthing racket. But the criminals changed tactics and kept going. Ray Carroll, executive director of the industry and government-funded National Motor Vehicle Theft Reduction Council, says criminals now buy up insurance write-offs at auctions, steal matching vehicles and strip them of the parts they need to repair the original. Under the law nothing exists to stop these being re-registered.

"They will have a workshop somewhere in the industrial suburbs, where there will be a panel beater's shop. They will take the wrecked car there, then take in the stolen car and put it alongside, then strip it down and build the original," Carroll says.

"They are experts, they can strip it down to the bare bones. A team of good guys can easily do that in half an hour. Remember, they are not doing it like a mechanic, who wants to put it back together, they go in with metal saws and hack out what they need."

The resulting carcass is often either dumped on the street or sold as scrap, which effectively destroys the evidence of the crime.

Carroll says according to Roads and Traffic Authority figures, about 100,000 vehicles were written off last year nationally, 70 per cent of which were written off by insurance companies, providing the raw commodity for the rebirthing syndicates. Intelligence gathered by police suggests NSW is the national hub of the industry.

National intelligence agencies have investigated possible funding links between the export of stolen cars and car parts and terrorist groups in the Middle East. Last year, a Victorian court was told that 13 men accused of planning a terrorist act in Australia had planned to finance the job partly through car rebirthing.

While NSW may be its hub, car rebirthing is a national - and indeed international - problem aided by the fact that cars are moveable assets. Car rebirthing was only made a crime in NSW last September. It is still not a crime in WA, although draft legislation is being considered.

Andrew McKellar, chief executive of the Federal Chamber of Automotive Industries, suggests the solution may lie not in the courts but in the private sector, with the insurance companies. "You still have so-called repairable write-offs and I think we would call on the insurance industry as a whole to reconsider these because there is still rebirthing as a result," he says.

NSW police want legislation making it impossible to re-register insurance write-offs, effectively closing the loophole that allows these vehicles back into the market, although detectives do not believe responsibility lies entirely with insurers.

Investigators say the wider problem remains that it is impossible to trace cars or car parts that have been rebirthed. Last November, the Australasian Police Ministers' Council endorsed a proposal from the police services to develop a system of "whole of vehicle marking", with a car's components each being marked with an identification number allowing them to be traced individually. The proposal has stalled, however, because of opposition from the motor industry and concerns that the technology does not yet exist to implement the system commercially. "It's been looked at, it's been evaluated and in a logistical sense it's difficult to apply in a manufacturing point of view," McKellar says. "I don't think there are grounds to contemplate mandatory whole-of-vehicle marking."

The New Zealand Government has announced that microdot marking - the application of indelible identifying dots on most car parts - will become mandatory on all new cars from 2008, however, a move the country's Ministry of Transport estimates will cut car theft by up to 50 per cent.

The cost of this - about $NZ88 ($78) per car, according to ministry figures - will be passed on to the consumer. In Australia, a number of car companies are running trials using microdot technology developed by the Sydney-based firm DataDot Technology. Since 2003, car manufacturer Subaru has used DataDot machinery to spray 1mm microdots containing the vehicle identification number on to the component parts of every new car brought into Australia.

As a result the company has experienced an 86 per cent drop in thefts, according to figures from the NMVTRC. DataDot chief executive Ian Allen says the company, which employs former WA police officer Jim King, will next month launch a new robot that is able to spray the microdots in less than a minute, which he hopes will help overcome industry objections that the process will hold up production lines.

Yesterday, Allen met the WA Police Minister John Kobelke and commissioner Karl O'Callaghan to discuss breaking the stalemate and introducing the technology in that state.

"We're out there on a world stage by ourselves," Allen says. "It's really an Australian-led technology which will give police all over the world a weapon they have never had before."

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