NEXCO CENTRAL (Central Nippon Expressway Company Limited)




January 22, 2009 Chairman Yano's regular press conference

Conference Summary

(Moderator)

Then we will start a regular conference.


(Chairman)

NEXCO CENTRAL Hironori Yano, Chairman and CEOHello everyone.
Well then, let's start with the business overview for December. Fee income in December was minus 9.5% year-on-year. The breakdown is high-speed minus 10.3%, and general pay is minus 1.3%. Highway sales declined due to the impact of the reduction in toll charges under the "Urgent Comprehensive Measures for Achieving Peace of Mind" that has been implemented since the fall of last year, and factors such as an increase in the discount amount due to the spread of ETC. Revenues for general pay also decreased due to an increase in the discount amount accompanying the spread of ETC.
The number of traffic is almost flat, minus 0.1% year-on-year. The breakdown is 0.6% for high speed and 2.2% for general pay.
This month's ETC discount was 17.9 billion yen, a 21.2% increase over the same month last year. If there was no ETC discount, the fee income would have been 62.6 billion yen, a decrease of 2.4% year-on-year. This month's ETC discount rate is 28.5%.
As I explained last time, the composition by vehicle type is 106.7% for light vehicles, 100.6% for ordinary vehicles, 93.4% for medium vehicles, 93.8% for large vehicles, and 85.7% for oversized vehicles. Last month, large-sized vehicles accounted for 93.2% and oversized vehicles accounted for 92.6%, so the number of large-sized vehicles continues to decline.

The status of construction. The Kisei Expressway finally extended on February 7th, and it is approaching. By all means, I would like to thank as many people as possible. Also, there is a present plan to commemorate this extension, and I would like to explain this later.

Next is the use situation of ETC. The number of passengers used increased by 4.6% compared to the same month of the previous year, and the daily average usage rate was 77.9%, which is a considerable increase over the previous year. Taking the last week, the usage rate is 79.1% from January 9th to 15th. Since it was 78.5% one month ago, it can be said that it is steadily increasing. It was 81.1% on weekdays, and reached 80% for the first time in November, but that trend is progressing. On weekends, 74.6% is 76.3%. The cumulative number of on-board units installed is 22.29 million.

Regarding the situation of SA, this month it was 96.2% of the previous year, and the cumulative total was 102.0% of the same month of the previous year. The breakdown is 104.2% for food and drink, 111.3% for product sales, 106.5% for services, 64.8% for gasoline, and 107.9% for advertising.
Except for the gasoline sector, sales continue to increase year on year. The above is the current status of the business.

Next is the topic.
First, let's report on the bidding situation and its analysis. This is the second time we have to report the situation quarterly. As you can see in the materials at hand, Table 1 shows the average successful bid rate for each month from April to December, with a total of 177 cases, 84.1%. Table 2 shows the distribution of successful bid rates for the main types of work for the three months from October to December. The average successful bid rate for all work types is 84.0%, but as shown in Table 2, the successful bid rate for steel bridge superstructure work is as high as 99.3%. The average successful bid rate may be 90%, but we have analyzed that it was a high successful bid, especially because it is a construction under difficult conditions across major national roads. On the other hand, the low successful bid rate of 74.4% for tunnel construction, 65.9% for electrical construction, and 67.3% for landscaping construction is competitive because the number of bidders for these construction types is higher than other types of construction. It seems to be the result.
Table 3 shows the occurrence of low bids by year. The low bid occurrence rate in fiscal 2008 was 38.3% from October to December, so the rate is slightly higher than in fiscal 2007.
Table 4 shows the number of cases of bad bids by year. In October-December, the number of cases was 25, with an incidence rate of 21.6%. Although the incidence rate has decreased slightly, as you can see, the number of bad bids in 2007-2008 increased compared to 2006. This 21.6% figure in the three-month figure shows a downward trend compared to fiscal 2007 because of the introduction of a public tender type quotation consultation method that allows contracts even if the contract price is exceeded and a new bidding mechanism called construction technology competition type. We did, but I think that it might be the result.

Next, we are launching a bus travel product that we can announce today before the opening of the Shin-Tomei Expwy. With Kinki Nippon Tourist, we decided to cooperate with the bus. It is set during the spring break so that customers with parents can easily participate. There are 2 courses from Nagoya and 1 course from Tokyo.
This is the fourth time for a travel product that incorporates a road under construction. The first time we do this is in the Hida Tunnel, and the Shin-Tomei Expressway means we do it once at the end of the year, so it will be the second time. As you can see in the document, the plan is to see the tourist spots in the area while viewing the roads under construction, including the Fujikawa Bridge, which has been highly acclaimed for its complex arch bridge.

次は紀勢自動車道延伸記念Wチャンスプレゼントと銘打った企画です。ひとつは美し国を結ぶETCマイレージポイント、もうひとつはハイウェイキャンペーン三重2009という、2つの企画が一緒に行われるものです。出来上がったばかりのチラシをお手元にお配りしていますが、このマイレージポイントは、いろいろと地元にご協力をいただいて開通を迎えたという感謝の思いをこめて、紀勢大内山ICの出口をETCで通過されたお客様に抽選でマイレージポイントをプレゼントするものです。ハイウェイキャンペーン三重は、三重県観光連盟と提携してこれまでも何度かやってきまして、今回で9回目です。この2つの企画をつくりまして、皆様にご利用いただけるようにしました。期間は開通の2月7日からおよそ3ヵ月間の5月15日までとなっています。

Next, I will report on the results of the Tomei New Year's traffic jam reduction campaign. I wanted to reduce the traffic congestion, and I'm doing this with a lot of wisdom, but this time I did a campaign to reduce traffic congestion during the New Year. On the 5th of this month, along with the traffic conditions at the end of the year and the beginning of the year, I reported the outline of some results as a preliminary report, but what is the result?
There is a large traffic jam at the beginning of the famous Yamato tunnel near Atsugi IC-Yokohama-Machida IC, but we decided to alleviate the traffic there, so we carried out on January 2-4. As for the results, traffic volume increased by 15.1% during the campaign target hours. I think PR got a little reaction.
Then, as if the absolute congestion amount really decreased, as shown here, the average daily traffic volume increased by 4.4%, the Expressway the end of the year and the beginning of the year increased by 3% in total compared to last year However, this area increased by 4.4% and the actual traffic congestion increased by 22.5%.
I think there may be criticism that this is not worth doing, but I think that there was an effect in that sense if the overall analysis showed that traffic congestion had increased if it was not done. As mentioned in (3), I think that there was a reduction effect of about 3%. There are times when it will be crowded in the future, so I would like to think about how to proceed.
The number of applicants for the campaign was 2,025 and the number of users was 1,288, which was not necessarily large in number, but I would like to thank all those who cooperated. However, when we conducted an interview survey with Ebina SA, only 10% of them knew this campaign, so I should regret not having enough PR. When doing similar projects, I think we need to think of ways for everyone to know as much as possible.

Next, I would like to report that Tomei-Hamana Lake SA and Hokuriku Expressway-Sugitsu PA have been certified as "Sacred place for lovers". It is said that there are a lot of keys, love heart locks, in which the wishes of lovers are placed, in both areas. I also went to Lake Hamana once to see it, but there are many locks on the net, and it is a sight that makes me feel cute. I have heard that these "holy places for lovers" have begun to be recognized in various places, and there are now 74 places, and I have plans for about 100 places nationwide.
To commemorate this certification, we plan to hold a commemorative ceremony in the spring, but I would like to announce the details again. Here is the signboard we received and we plan to put it up locally. The key is currently circulating in kind, so please take a look.

次の話題がETCレーンの速度抑制対策の実施状況です。私どもとしては、なんとか安全な交通を実現したいという悲願だったわけです。11月25日からはじめまして、12月17日をもちまして全レーンで速度抑制対策を終えたんですが、開始から2ヵ月の間、交通事故、通過速度ともに良好な状況でして、このようにドライバーの皆さまにご協力をいただけましたのも、皆さま方の積極的な取材・報道のたまものであると思っています。心からお礼申し上げます。交通事故の発生状況ですが、資料にございますように1日当たりの件数で1.4件から0.7件へと半分に減っています。それから平均速度で時速約5km程度の低減効果があります。また著しい速度超過車両の割合が平均で約54%削減されています。一方こんどの措置による渋滞は発生していません。こういうわけで順調に推移しているということをご報告させていただきます。

Next is a report on the implementation status of emergency safety inspections. From January to May of last year, there were five incidents of concrete fragments falling from Expressway. On the other hand, thinking that it would be too late after a personal injury, we started to conduct an emergency safety inspection in May last year with all Companies in our Group. The first check has been completed. In the 1st stage inspection, we checked all the places where there is a signal of damage due to aging deterioration etc. in the regular inspection, and the places that are likely to affect third parties. The places where the influence on third parties is assumed are the places where people and cars pass through, where the roads intersect below. As for road structures, we have completed inspections of 2,164 locations and 5,038 locations of road accessories such as lighting and information boards, and have completed emergency measures for each of the 380 locations that require immediate attention. In the second inspection, all the remaining places were targeted, and even if it was determined that the urgency was not so high, starting from October of last year, we would like to inspect the places where the impact on third parties is expected. However, as of the end of December, 21% of 5,781 road structures have been inspected. There are 22,900 road accessories, 55% of which have been inspected. As a result of this second inspection, we have completed emergency measures at each of the 26 locations that require immediate attention. As a result of the first inspection by the end of November, 1,121 repair points were confirmed. As I said, 380 of them were already repaired. We are currently formulating a repair plan and would like to finish repairs as soon as possible. As I say from time to time, it is important for us to build new roads, but I think it is also important to carefully use existing roads and make them last longer. In-house, it's called "Hundred Year Road Plan". Meishin or Tomei is in the situation of 40 years or more than 40 years. In order to keep this for 100 years, it is very important to carefully check and repair, and I would like to continue to carry out this as an important measure of our company.
There are various photographs in the materials at hand, but in a tunnel, for example, you climb up with a work platform, hit it, and visually inspect it. I also had one place put on during the intensive construction period and hit it, but I thought it was quite right. There are major damage cases below, but this is not that the concrete piece actually dropped from here, but it was knocked down because it was not possible as a result of inspection and it looks like this. As you can see, it gradually deteriorates like this. Various data are listed, so I hope you can read it.

Next, regarding the implementation status of the Midori-no-Sato Project, this was a quiet year and started in May 2007. We plan to promote greening and beautification of the slopes with the cooperation of everyone in the region, but thanks to the cooperation of so many groups and individuals, we are currently working on 11 green areas. A village project is being conducted. The event has been held 14 times at 11 locations since May, and has attracted a total of 1,000 people. There are 27 candidate sites within our jurisdiction, of which 11 have been realized. I would like to continue with the cooperation of many people. Up until now, many local governments, schools, and companies have participated, but we would like to expand it to a wide range of volunteer groups. For a large-scale project by this volunteer group, we gave a small amount of recognition to us in two places. As I said earlier, the plan for the future is to expand the range of groups that participate as much as possible, at the same time not only planting trees, but also mowing undergrass and adding fertilizer, replanting flowerbeds in the flowerbed. I would like to expand the range to the place where weeds can be cooperated.
Since the theme of "Messe Nagoya 2008" held last year is "environment", we asked for tree planters in the open call for participants when we exhibited, and there were 30 applicants, and Isewangan Expwy We had you plant trees on the site of Toyota-higashi IC.
The list of 11 places I have visited so far is in the document.

That is all for my report.

 


(Moderator)

Then, thank you if you have any questions.


(Reporter)

We would like to ask you about the emergency safety inspection. It is said that there are about 1,000 places that have not been repaired yet, but by when do you plan to finish the repairs? Also, it seems that urgent ones are dealt with each time, but what kind of damage was caused by the five drops from January to May?


(Chairman)

The inspection is currently in progress, and we would like to complete it as soon as possible at the places where immediate attention is needed. It doesn't break down quickly and lead to damage, so I have some time to spare, but I will do it as soon as possible. I would like to manage to complete the first check by the end of the fiscal year, but due to various reasons, I can not say so far, but I would like to speed up.
On the other hand, in the fall events so far, no accidents that seemed to be accidents have occurred, and no other personal injury has occurred except that a small piece fell on the car. But I think stripping is a sign of danger. Therefore, we thought we shouldn't ignore this, and immediately in May of last year we immediately set up a countermeasures headquarters within the company and implemented it company-wide. Still, I don't think that what I have done so far is perfect, so I would like to speed up as much as possible and take measures. There were eight exfoliation cases during the year from January to December of last year. The places are scattered around the Tomei, Hokuriku Expressway, and Tomeisaka areas, and it doesn't mean that there is something wrong with a particular place, but I think there are geographical conditions, so I can't say it in general. However, I think that we, who manage the roads, will have to take one step at a time and go on their own initiative.


(Reporter)

It means that the places are scattered, but I don't think you can see the tendency that the roads that have been completed since a long time ago, such as Tomei, are markedly stripped.


(Chairman)

I don't think I can say for sure so far. It can be said that there are many Tomei with 4 out of 8 total, so the idea is to give priority to roads that have been older. Since aging is also a change over time. Although salt is used as a measure against snow and ice, and there is "salt damage" on roads near the coastline, but generally speaking, I think that the more time passes, the more brittle it becomes. There are two other cases on the Hokuriku Expressway. Hokuriku Expressway is 30 years old in the old section. Tokai-Hokuriku Expressway was fully opened in July of last year, but it has not been 30 years since the old section had passed, so in that sense it does not mean which road is okay, so I would like to proceed evenly. I will.


(Reporter)

The other day you announced a plan of 1,000 yen no matter how far you run, but I think that there is a "go" part in terms of how much quantitative effect it will have, or about fee income, but please tell us your outlook.


(Chairman)

We haven't fully analyzed the numbers yet. I think traffic will definitely increase. I think traffic will increase accordingly. At the moment, honestly, it's difficult to decide how many of them will increase. The reason is that I have never done anything like this. We have an enormous database, we have various examples of what happens when we raise or lower rates, and we can do simulations, but since we have never introduced such a drastic rate system, how much Honestly, it is a situation that cannot be quantified at the moment whether the reaction appears in the traffic volume. That being said, looking at the so-called "elasticity value", which is how much traffic volume increases when the price is lowered, there are numbers such as 0.3 and 0.1, but that is probably not the case. I don't think so. It can be said that the traffic volume will increase by this amount if you consider it with an elasticity value of about 0.3, but to be honest, it is a situation that I can not affirm for now.


(Reporter)

How do you think it works in terms of income and expenditure?


(Chairman)

Since this fare measure will be carried out by the national financial resources, our income will decrease once, but it will be compensated for by the reduction of the road property loan fee. So, roughly speaking, as you said, "Go". However, I think it will be necessary to take measures against traffic congestion, take measures for road damage due to increased traffic, and enhance various safety equipment. I wonder if the country will see such expenses, so I think that's not the case, so I am prepared to pay for that amount.


(Reporter)

Is there a positive element? For example, I think you can expect income from product sales and services.


(Chairman)

I agree. Looking at the company as a whole, I think the increase in traffic volume through discounts will lead to an increase in SA / PA sales. I mentioned the sales situation of SA / PA earlier, but I think that the trend is accelerating as the situation is a little higher than the previous year except for gasoline. However, as you know, SA and PA are large, and not all places have a spacious parking lot. If the parking lot is full, sales will not increase much. For example, when there is a SA at Lake Suwa on the Chuo Expressway Expressway, and there are a lot of cars when there is a fireworks display at Lake Suwa in the summer, there are a lot of cars, but sales do not grow at all. As such, there is no such thing as if sales of SA / PA will immediately increase just because the traffic volume has increased as a whole. I have the ability in terms of equipment, and what I think we should do sooner because of something more important is to make SA a more attractive place. I think it must be a really attractive place for merchandise such as going there and buying it, food, and a break. But I think these discounts will generally work in the positive direction.


(Reporter)

We often hear that the Sanyo Shinkansen uses sea sand during construction during the high-growth period, which damages the viaduct, but there is a possibility of sea sand problems on your Expressway Is there any?


(Chairman)

I do not think. Let the person in charge explain in detail.


(Manager Minemura)

We have established quality control standards regarding the residual salt content of the sand used. We have been carrying out quality control from that time based on that, so there is no such thing as the significant damage currently caused by the use of sea sand. We take pride in the results of the careful quality control at the time of construction. On the other hand, damage such as alkali-aggregate reaction that could not have been anticipated at the technological level at the time is occurring in the same manner as Shinkansen.


(Reporter)

Currently, there are no problems caused by sea sand.


(Manager Minemura)

Yes.


(Moderator)

If there are no other questions, we will end the 39th regular press conference.
Thank you for being busy today.


(Chairman)

Thank you very much.