Buying Mazda Rent-a-Car and entering mobility (2009)

A business laid on top of the empty bays

The $22.1M (¥2bn) paid in this acquisition was small even against Park24’s annual operating profit of $113.3M (¥11bn) at the time. As a price for a company with sales of $199.9M (¥19bn) and recurring profit of $662,889 (¥62m), it is not a particularly strange level either. What was bought was not profit but 18,000 vehicles, 385 branches, and the procedure for buying cars, maintaining them and selling them on. Assembling the same thing in-house would have meant spending the years before the market opened on preparation. As an entry decision, shortening the time to entry was chosen ahead of the size of the market.

What told after that was a single point: there was no need to rent new space to put the cars. While the other entrants into car-sharing ran aground on parking costs, Park24 could thin its expenses by rotating its own bays. That advantage, however, assumes the parking business keeps holding bays across the country. When the pandemic of 2020 knocked down car park utilization and rental demand at the same time, the meaning of two businesses sharing one footing showed itself from the reverse side as well. The idea of laying another trade on top of an empty bay is strong exactly as long as the bay is empty.

What was bought in March 2009 was a rental car company headquartered in Hiroshima with sales of $199.9M (¥19bn). Ten years later it was the name of the segment ranking second only to car parks.