Portugal, Airports, and the UAE

September, 2019

Some time ago, I spent quite a lot of time helping the Iberian company Empark and thoroughly enjoyed it. Empark was formed about a decade ago by the acquisition of Spain’s giant Cintra Parking by Emparque, a relatively small but successful Portuguese operator. 

I got to know them when they started working in the UK, slowly but steadily growing a portfolio of highly successful contracts, mostly at airports and hospitals. These guys knew their business and had some pretty clever ideas and products. Inevitably, the business is now owned by a bank, which has already shed the UK subsidiary to focus on Iberia.

One thing that they did, that I never agreed with, was to charge at airport drop off zones. For sure, there is a problem with drivers picking up passengers who hang round the drop off zone, but when you introduce a charge you are taxing airport access and, particularly for taxis, this can get silly. Some airports have introduced one hour free parking in the long stay, but being a ten-minute bus ride from the terminal, it’s hardly slick.

This idea has gone spectacularly wrong at East Midlands Airport. Cunning Plan A introduces a £2 charge for ten minutes in the drop off zone. The airport owner is quite honest, this is to raise money for improvements. Nothing wrong with that. 

So, cunning Plan B makes it £2 for five minutes, with £1 per minute if you stay longer. Yes that’s £1 per minute! Problem was, they hadn’t thought it through, and drivers started to pick up extra charges, not because they had overstayed but because there wasn’t enough exit capacity and sometimes the airport road outside the exit was blocked. So, now we have moved to cunning Plan C, and they have gone back to a 10-minute stay, but hiked the charge to £3. All of this was done without any prior notice. Drivers simply turned up one day and found that they had to pay. 

A few months ago, I wrote about London Gatwick Airport’s plan to trial a system of automated valet parking provided by The French Company Stanley Robotics. Since then people from Gatwick have been doing the conference circuit, telling us all how wonderful this will all be. The system is supposedly working at Lyon in Paris and the plan was that the trial would go live for the summer season, which started two weeks ago as I write. 

So, I called up the airport’s media people expecting that, at least, there would be a press release of launch day. Err, Um, there was a significant pause before the guy on the phone told me that there was “a delay”, they hoped to be in a position to say something in September, and if I called back mid-September... So, the summer start date was a delay on their first launch date, and now it may be working by autumn. I am sure that it will be alright, eventually,

Perhaps.

Out in the Gulf

Meanwhile, out in the Gulf, the region continues to move forward on the idea that parking should be managed and charged for. A decade or so ago, when I got invited to Abu Dhabi “for a couple of weeks” to sort out the parking problem, only Dubai, had parking management. Abu Dhabi had finally built some car parks, but with streets free and uncontrolled, the structures were mostly empty, even though the charges were purely nominal. 

Now parking management is spreading. Abu Dhabi CBD has somewhere north of 80,000 spaces, and two 30-year franchises for other parts of the city, each over 60,000 spaces, await award, with two more concessions in line. The latest thing across my desk is an Expression of Interest for Doha in Qatar for a major parking concession to provide and operate parking there. 

I have read the document interest and it seems to me that anyone bidding for this is going to find the project really challenging. The successful bidder will have to design, finance, build, operate, maintain and finally transfer the whole operation to the government at the end of the concession. Nothing exceptional there. The killer is that the government will set the charges and the government will control enforcement. 

About a decade ago Qatar tried street parking; people ignored it. The police didn’t want to write tickets, and so the whole thing crashed and burnt. If there is little or no enforcement, why would anyone pay to go into the car parks or put money in the meter? 

Sometimes, those who set parking charges don’t seem to understand the link between the charge and the cost of provision. Now it’s fine if a municipality determines that, for whatever reason, they will subsidize their parking, but the minute you involve the private sector you need to understand that the charge must give a return on investment if the concession is to work. 

In a recent example in the region, the city set a charge that covered about one third of the cost of the structure. If the people running the tender don’t understand the need to link risk and reward, it’s probably going to end in tears.

Sad, Happy, Scared

Sad Face. A few years ago, I mentioned England’s longest lasting private company: R Durtnell and Sons, which had been continuously owned by the same family since it was established in 1591. In fact, the founder John Durtnell had been operating as a carpenter since at least 1570. Sadly, the business has ceased trading after getting into problems with a major renovation of a part of the Georgian Brighton Pavilion.

And finally, rejoice, we have a new prime minister. Theresa May has stepped down after just about three years as PM. In that time, she lost an unnecessary General Election and failed at everything. She is widely held to be the worst prime minister of modern times. 

Boris Johnson, her successor, seems at times to fantasize that he is the reincarnation of Churchill, only without either the ability or wit. People who know his track record, both as mayor of London and a short-lived, gaff prone minister, suggest that his predecessor may not hold the “worst ever” title for long. He has already lost one MP. But take heart, Boris, or BoJo, as he is known, was born in New York, so, once he has finished up here, he can come and mess up the land of his birth. Be afraid, be very afraid. 

Peter, I harken back to yesteryear when newly elected officials were given a ‘honeymoon’ period where criticism was held in check for the first few months, at least until they had an opportunity to do something worth criticizing. Oh well…in this time of lightspeed information, I guess a ‘honeymoon’ is a nonstarter. JVH