Reshaping the U.S. Parking Industry: Adapting to New Market Realities

In an era of dynamic market fluctuations and changing consumer behavior, the U.S. parking industry is undergoing a significant transformation.

Once a stable business model, the industry now grapples with a new reality shaped by factors such as the surge of e-commerce, the rise of ride-hailing services, and shifts in work patterns driven by the COVID-19 pandemic. These factors have collectively contributed to a marked decline in the demand for paid parking.

The Struggle and the Pivot

The U.S., home to an estimated 700 million to 2 billion parking spaces, approximately 2.5 to 7 spots for every registered vehicle, has seen a precipitous drop in parking revenues during the pandemic era. In 2020, revenues fell to a dismal $58 billion, a staggering 56% lower than 2019 figures.

However, the tide appears to be turning; projections indicate a likely recovery to approximately $144 billion in 2023, representing a 10% increase over 2019 levels.

Despite having contracted at an annual rate of 7.7% from 2018 through 2023's end, the segment that manages parking facilities for owners is projected to grow at a rate of 1.4% from 2023 through 2028. This modest growth can be attributed to pent-up demand and adaptations by operators, including catering services for ride-hailing and electric vehicles (EVs), such as charging and maintenance services.

Adapting to New Market Realities

Companies like SP Plus are investing in new technologies and services to stay competitive in this evolving landscape. Implementations include apps for reserving and paying for parking, dynamic pricing, and automated vehicle charging upon entry and exit.

These technology solutions, which accounted for about 2% of SP Plus's gross profit in 2022, are expected to grow to 10% by 2025. Larger companies, having the capital to invest in research and development, are better poised to adapt to the changing market demands compared to their smaller counterparts.

Phoenix Parking Solutions: Pioneering the EV Parking Revolution

Among the frontrunners in technological innovations in the U.S. parking industry is Phoenix Parking Solutions. The company offers comprehensive consulting services and infrastructure solutions for EV parking and charging, helping property owners adapt their facilities most cost-effectively.

With a strategic partnership with Pyramid Network Services, they aim to simplify the EV charging installation process and guide businesses through the transition.

The share of electric cars in total sales has more than tripled in the past three years, and the size of the global EV market is expected to reach $906.7 billion by 2028.

Phoenix Parking Solutions is encouraging property owners to consider the potential of EV chargers to draw in more customers and increase revenue, thus playing a pivotal role in reshaping the U.S. parking industry to meet the demands of a new era.