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Shikoku Railway Company (JR Shikoku) Management Planning Department

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Shikoku Railway Company (JR Shikoku) Management Planning Department 20 Years After JNR Privatization Vol. 2 Shikoku Railway Company (JR Shikoku) Management Planning Department Introduction JR Shikoku’s Business Environment JR Shikoku was founded in April 1987 with the objective Right from the start of the JNR division and privatization, of establishing efficient management of railways in critics predicted that JR Shikoku would immediately face Shikoku and becoming a community-based organization. a very tough business environment. Surprisingly, the Although the company is the smallest operator in the Japanese economic boom in the late 1980s coupled with group of six JR passenger companies, as well as striving the opening of the Seto Ohashi Line in April 1988 helped towards full privatization (one of the goals of the Japanese produce a large increase in transport volumes, which in National Railways (JNR) reforms), we have also worked combination with improvements in transport services and at becoming a vital part of our local community, which focussed efforts on efficient operations, produced greatly is a key aim of our management philosophy. Since our increased operating profits. Unfortunately, the collapse company is deeply rooted in the Shikoku region, we have of the ‘bubble’ economy and ensuing long-term recession tried to improve our railway services as the foundation had a profound negative effect on our business made of our business, promote regional tourism and businesses worse by fierce competition from trucking companies in coordination with local groups, and become more after the opening of the Honshu–Shikoku bridges, and efficient by cutting costs. Despite this hard work, we are rapid development of express bus services on the new still not at a stage where continuous and stable revenue Shikoku expressway network. is assured, so we are only halfway to our goal of Additionally, Shikoku has Japan’s most rapidly aging establishing a business basis for full privatization. population and falling birth rate, both of which seem However, we do feel that we have achieved a greater likely to be irreversible future trends and raise serious presence as a company in the last 20 years to become an concerns about the local economy losing its vitality. Such integral part of Shikoku’s community. a downturn would have a great effect on JR Shikoku, because we are rooted in the local community. Despite these difficulties, fares have only been raised once (January 1996) in the last 20 years although income and cost forecasts in 1987 suggested that fares would have to be increased annually for the first 5 years. Our ability to keep fares stable and competitive in the transport market is perhaps one of our most significant achievements. Railway Business Trends By establishing ourselves as a community-based company, we developed our railway business in tune with local characteristics and in cooperation with local governments and businesses. As such, we make a great contribution to the local community in both social and economic terms. At a November 1985 meeting of the Shikoku Regional Council of the Supervisory Committee for JNR Reconstruction, strong requests were made to The Seto Ohashi Line opening in April 1988 helped increase strengthen the inadequate railway infrastructure but even transport volumes immediately after the company today, the number of electrified and double-tracked lines foundation. in Shikoku is much lower than the national average. One Japan Railway & Transport Review 49 • March 2008 38 ○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○ ○○○○○○○○○ 20 Years After JNR Privatization Vol. 2 Figure 1 Railway Passenger and Railway Figure 2 Equipment Investment Trends Revenue Trends (¥ billion) 18 Other Investments Railway Passenger Trends 16 Safety Equipment 14.4 (million) 14 Others Commuters 12 5.8 80 10 63.4 65.8 64.4 8 7. 6 7. 3 6.3 60 55.2 57.4 51.8 6 4.7 30.0 48.8 4.7 4.4 Equipment Investment 8.5 28.8 28.3 4 3.7 4.3 1.4 3.1 23.4 24.7 21.9 2.1 40 19.5 2 1.2 2.8 2.8 3.3 1.6 2.0 1.9 0 1987 1990 1993 1996 1999 2002 2005 (FY) Number of Passengers 20 34.6 35.8 36.1 31.9 32.7 29.9 29.3 *FY1989 to FY1992: Constructed electrified line 0 between Kan-onji and Iyoshi 1987 1990 1993 1996 1999 2002 2005 (FY) on Yosan Line *FY1990 to FY1993: Constructed new Tokushima Station building Railway Revenue Trends *FY1998 to FY2001: Constructed new Takamatsu Station building (¥ billion) Others Commuters 40 36 36 37 32.3 30 28.5 26.5 26.1 20 32 31.8 32.1 27.7 ailway Revenue ailway 22.7 24.1 R 21.7 10 3.8 3.9 4.1 4.8 4.6 4.4 4.4 0 1987 1990 1993 1996 1999 2002 2005 (FY) *FY1988: Seto Ohashi Line opened *FY1995: Fare revision The number of limited express services increased from 85 to 188 in 20 years. reason explaining the long-term decline in our railway Timetabling for customers and boosting business is the fact that while our competitors have more demand by investing in new trains or less completed development of their transport infrastructure, we have not yet built infrastructure able Our tracks in Shikoku are unique in Japan because they to fully compete with them. are almost all non-electrified; a small stretch was electrified just before privatization, but even most of the Constructing safe operating systems main tracks were single track and non-electrified and there were many sharp curves and steep grades. In this Safe operations have been our guiding principle from the context, and in anticipation of future competition from first day. In terms of actual infrastructure, this means expressways, our first goal was to shorten times between making continuing investment in equipment to assure cities by running faster trains. As part of our drive to safe and stable operations, regardless of total income in improve our infrastructure, we developed actively any particular fiscal year. We have also enhanced ‘softer’ controlled tilting technology allowing Series 2000 limited structural and training-related measures, such as revising express diesel railcars to run faster through curves, and our Safety Code, to heighten safety awareness. invested in electrifying the Yosan Line. 39 Japan Railway & Transport Review 49 • March 2008 ○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○ The 26 March timetable revision was the 27th since our (AED) at all our stations. foundation and reflects the greatly increased number of In terms of structural and training-related measures, since daily services from 629 in 1987 to 1022 in 2006. The October 2004, some staff have been acquiring ‘care-fitter’ number of limited expresses has also been increased from qualifications—a non-official qualification that trains 85 to 188, reaching 1 every hour on main lines. people to offer professional assistance to elderly or Recently, we have been working hard towards our goal disabled people by helping them to walk or by operating of being our customers’ preferred mode of transport by their wheelchairs. In our business, this means helping re-timetabling our limited express services to meet the customers move around stations and get on or off trains. needs of students and commuters. We are expanding the number of these qualified staff at more of our stations. Providing reassuring and comfortable space, and other services Travel Business Expansion JR Shikoku is helping provide customers with easy-to- To expand and develop non-railway business, we use, barrier-free stations by installing elevators and established an independent travel business with city- escalators at elevated stations, wheelchair slopes, multi- centre shops in Shikoku and branches in Tokyo and purpose toilets, and platform tactile blocks for guiding Osaka. Following this development, this travel business people with impaired vision. Some of these was reintegrated back into the railway business to assure improvements have been made possible by local- more efficient management and increase revenues for government grants. the railway business. We are currently marketing the From FY2005, we have been renovating stations to make travel business to emphasize use of railways, and are them cleaner, brighter, more user-friendly and easier to developing travel services that fully exploit our advantages navigate, and we were the first JR operator to introduce as a railway company. We are working hard to help station numbering. As a customer safety measure, in July customers rediscover the benefits of using rail to travel, 2006, we installed Automated External Defibrillators restoring rail to its former glory. Figure 3 Comparison of Journey Times Between Major Cities Time Reduction (minutes) 4 hourshours 5555 minutesminutes Shiokaze 130 (Matsuyama–Okayama) 2 hourshours 4545 minutesminutes Ishizuchi 2 hourshours 5151 minutesminutes 22 (Takamatsu–Matsuyama) 2 hourshours 2929 minutesminutes 4 hourshours 5252 minutesminutes Nanpu 141 (Kochi–Okayama) 2 hourshours 3131 minutesminutes Shimanto 2 hourshours 5050 minutesminutes 37 (Takamatsu–Kochi) 2 hourshours 1313 minutesminutes April 1987 Uzushio 1 hhourour 3333 mminutesinutes March 2006 26 (Takamatsu–Tokushima) 1 hourhour 7 minutesminutes 012345 (hours) Table 1 Comparison of One-Man Operations FY2006 FY1987 FY2006 FY1987 Local trains 834 544 Local trains 37,000 29,000 Number Train One-man 297 0 One-man 12,000 0 of trains kilometers One-man ratio 35.6% 0.0% One-man ratio 32.0% 0.0% Japan Railway & Transport Review 49 • March 2008 40 ○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○20 Years After JNR Privatization Vol. 2 Affiliated Businesses bridges and the development of the new expressway network. In April 2004, we split the bus business into a When JR Shikoku was founded, there were no large station separate company to enable faster decision-making and complexes with commercial facilities or hotels in our area encourage further business expansion through more and nor were there any nearby businesses, such as shops, aggressive strategies and development of new and better located under elevated tracks—our affiliated businesses services.
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