Business | FOCUS

Japanese parking firms see bonanza in Bangkok’s traffic jams

by Shizuka Yasunari

Nna/kyodo

Scarce parking space in Bangkok is aggravating chronic traffic congestion in the Thai capital, but some Japanese parking companies are taking a look at the positive side of the traffic nightmare.

Nippon Parking Development (Thailand) Co., a local unit of Nippon Parking Development Co., has enjoyed solid growth in operating revenue from more than 30 parking lots inside buildings in Bangkok.

The Osaka-based firm moved into Thailand in 2010 and subsequently implemented an automatic fare adjustment system, electronic signage to show space availability and surveillance cameras in parking facilities, and successfully curbed labor costs.

Some of the parking lots under its management have posted a 90 percent surge in operating revenue after introducing the advanced initiatives.

The local arm has designated selected space as VIP and semi-VIP lots as part of driver-friendly services and improved profitability.

“In Bangkok, the number of newly registered vehicles has topped 400,000 units annually in the last several years, equivalent to over 1,000 cars per day,” said Kenji Kawamura, president of the Thai unit who is also executive vice president of the parent company.

In another analogy, he said, “The combined length of a car body, let’s say 5 meters each, amounts to a row of 5 km daily.”

Bangkok’s parking space is capable of accommodating only 300,000 to 400,000 cars, as compared with the city’s traffic volume of 4 to 5 million vehicles, according to Kawamura.

Despite the government’s plan to add parking lots for 40,000 cars along railway lines by 2029, new parking supply is unlikely to catch up with surging demand.

One reason is that parking operations in Thailand do not normally generate profits.

For example, office building owners offer a parking lot for free to tenants who each rent floor space of 100 sq. meters.

Shopping mall operators also charge very low parking fees even in the heart of the capital.

It is also alleged that some parking workers are embezzling parking fees.

These factors discourage landowners from building parking lots.

“Parking fees should be raised in line with growing income to create better car parks,” Kawamura said.

Under such circumstances, automated parking systems have become common in Bangkok due to rapid condominium development in recent years on the back of economic growth in the Southeast Asian country.

“Five years ago, I believe only 1 of 10 prime condos in Bangkok employed an automated parking system, but now 8 of 10 do so,” said Kentaro Taki, general manager of Space Value (Thailand) Co., a local joint venture of Nissei Build Kogyo Co., a Japanese architecture design and construction firm.

IHI Asia Pacific (Thailand) Co., a local group arm of IHI Corp., a major Japanese heavy machinery and infrastructure firm, will install an automatic underground parking system at a condo complex in Bangkok next year.

The system features flexible parking lot layouts and efficient use of space and quick car retrieval, representing the first smart parking debut in Thailand, said Kai Miyake, general manager of sales and marketing of the Thai arm.

Meanwhile, Nippon Parking’s Thai unit teamed up with TC Car Solutions (Thailand) Co., an auto leasing joint venture of Tokyo Century Corp., to launch a car-sharing service at parking facilities in late August.

The parking operator is considering extending the sharing service to other facilities if demand rises, as part of efforts to raise awareness to shift from car ownership to car use.

“Building quality parking is no longer good enough, and we need to correlate parking to information technology and car-sharing services,” said Hiroshi Horiguchi, managing director of IHI’s Thai arm.