Deloitte warns parking operators: technology is also coming for your business

Technology has made it easy and efficient to get from A to B. By accounting for real time information on queues and other disturbances, smart systems not only shorten individual travel time. They can also optimize traffic flows as a whole. But one pesky and often overlooked detail can throw a spanner in the works: parking. It also means that proprietors of parking spaces have not felt much pressure to anticipate on any major gamechangers in their markets. But a recent report from Deloitte suggests that they had better start planning for the future.

A driver’s headache

Drivers will know the issue that parking poses all too well. It can take a number of passes around the block waiting for a spot to free up. According to the Deloitte report The Future of Parking, Americans on average spend 17 hours per year searching for a spot. This means a wasted 345 dollars per driver in time, fuel and emissions, with even higher costs in major metropolitan areas. The fact that cities gain much of their revenue from parking fees makes the issue even more important.

So why is it that technology has not yet tackled this problem, as well as navigation and traffic flow optimization? Solutions so far have been aimed at making it easier for drivers to pay for their spot. Automatic assistants that help find free spots are only just appearing on the market. One reason for this technological lag is that parking spots are immobile pieces of real estate. You cannot simply redistribute capacity according to needs, and the infrastructure is very much legacy. Parking operators have also not adopted any standardized means to share and collect data needed to build algorithms yet.

More than just efficiency

Parking operators already have economic incentives though that will gradually nudge them towards adopting new solutions. Higher asset efficiency is one of them, as sensors can alert nearby drivers of a free spot they might miss otherwise, which would resulting in them giving up the search altogether. They are also already able to introduce dynamic pricing, which increases revenue by tailoring pricing to the demand of the moment. Number plate recognition has already been widely adopted to make parking more hassle free for customers, removing another important barrier.

However, Philipp Willigmann, Sarah Turbek and Ryan Goldsberry, who authored Deloitte’s report, think that parking will most likely be part of a general mobility revolution that will change the transport game as a whole. By 2040, Deloitte reckons, more than half of the distance travelled in the US will be in shared autonomous vehicles that do not need to park. The main difference from traditional vehicles is that they are not idle for longer stretches of time, as they are resources that are simply shifted according to needs. This would lead to a decrease in parking space needs.

In the meantime, what else can parking operators do to stand out? According to Deloitte, they would do well to start thinking about additional services, including electric vehicle charging stations and valet parking systems – perhaps using automated robot platforms -, improved space management, make their facilities easier to repurpose, and by introducing the afore-mentioned flexible pricing models and monetizing captured data.

Read the full report here.

 

*) This article was brought to you by Michiel van Blommestein

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