Rising disposable income and car purchases will contribute to industry growth.
New York, NY (PRWEB) November 23, 2014
The Parking Lots and Garages industry experienced growth over the past five years. Industry operators provide parking services to all consumers and businesses, which results in stable demand; however, due to the recession, unemployment spiked in 2009. “High unemployment lowered the number of commuters on the road, which lowered demand for parking spaces,” according to IBISWorld Industry Analyst Edward Rivera. Although unemployment began regressing to prerecession levels in 2010, economic stimulus occurred in 2011, as operating conditions improved. Since, revenue has picked up as the economy recovered. In particular, international travel activity strongly expanded over the past five years, which bolstered demand for parking spaces at airports. As a result, IBISWorld anticipates industry revenue to increase at an annualized rate of 2.1% to $762.9 million in the five years to 2014.
Airports have been a major market for industry operators. In the five years to 2014, the number of international trips taken by Canadian residents is anticipated to increase an average of 6.1% per year, driving demand for airport parking. Steady growth in the number of cars on the road also bolstered demand for parking. However, revenue is expected to grow only 1.3% in 2014. Revenue growth is slowing due to a dip in disposable income growth, which limits consumer attendance at sports venues, music events and restaurants, all of which require parking services.
The industry has experienced advances in automation and online technology over the past five years. Parking facilities are incorporating automated entry systems, online registration, online fee payment and other technologies. “Although parking technology raises capital costs, industry operators can also experience longer-term savings on labour costs,” says Rivera. Overall, due to advances in automation, labour costs are expected to fall as a portion of revenue.
The industry is projected to slowly expand in the coming years, buoyed by rising disposable income and car purchases. Due to pent up demand in recent years, the number of vehicle registrations is anticipated to grow strongly, leading to greater demand for parking spaces. However, as people return to work, they will have less time for international travel, which will slightly dampen demand for airport parking.
For more information, visit IBISWorld’s Parking Lots and Garages in Canada industry report page.
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IBISWorld industry Report Key Topics
This industry provides parking and valet service for motor vehicles on an hourly, daily or monthly basis. Industry firms operate via management contracts, lease agreements or property ownership.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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