Expeditors International Shuts Down Computer Systems After Cyberattack

Source: The Wall Street Journal
February 22, 2022

The logistics giant hasn’t said when it will fully restore operations.

Seattle-based logistics giant Expeditors International of Washington Inc. said it had shut down most of its operating systems in response to a cyberattack disclosed Sunday, raising fears of further stress on already fragile global supply chains.

In a statement published on its website, the freight-forwarding company said it currently has a “limited ability” to conduct operations, including arranging freight shipments and managing customs and distribution activities.

Expeditors manages freight movements by air, sea and ground transportation in over 300 locations around the world, employing about 18,000 people.

The company warned in its quarterly report issued Tuesday that the cyberattack could have a material adverse impact on the company’s results, without giving an estimate of when its operations would resume. Expeditors didn’t disclose the nature of the attack or the systems that were directly affected. Spokespeople for Expeditors didn’t immediately respond to a request for comment.

Restoring systems after a cyberattack can be a fraught and complex process, said Jake Williams, a senior instructor at cybersecurity training company SANS Institute. It usually takes a minimum of 48 to 72 hours to get back online, said Mr. Williams, who has worked with logistics companies on disaster recovery, but that can stretch to weeks without very good backups.

“For a company like Expeditors, there are so many externalities that restoring the IT systems doesn’t restore the business,” Mr. Williams said.

The attack is the latest in a number of hacks to affect the logistics industry. In December, Germany’s Hellmann Worldwide Logistics SE & Co. KG experienced a cyberattack that resulted in a data breach. A January cyberattack at Mabanaft GmbH & Co. KG Group and Oiltanking GmbH Group, two units of fuel logistics provider Marquard & Bahls AG, disrupted terminal operations.

Analysts are concerned with how hacks can damage supply chains, particularly involving maritime freight, which are already stretched thin due to the effects of the Covid-19 pandemic.

Mr. Williams of the SANS Institute said cybersecurity should already be a priority for logistics providers. “This should not be the thing that is waking logistics organizations up and saying, ‘Hey, we should probably take cybersecurity seriously,’” he said.

The Atlantic Council, a think tank focused on geopolitical issues, issued a report in October stressing the need to enhance the security of the Maritime Transportation System, which accounts for around one-quarter of U.S. annual gross domestic product. Many of the largest shipping lines have suffered cyberattacks in recent years, as has the International Maritime Organization, which serves as a global regulator for the industry.

The U.S. government issued guidelines for enhancing maritime cybersecurity in December 2020, warning that the sector’s increasing reliance on technology was introducing new systemic concerns. An executive order issued by President Joe Biden on Feb. 24, 2021, specifically mentioned cybersecurity as a risk to supply chains.

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