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The Japan Transportation Infrastructure Construction Market is expected to grow at a CAGR of more than 5.5% during the forecast period (2022 -2027).
The pandemic led the Japanese economy to contract by 29 percent on an annualized basis in the year 2020. In December 2020, real wages fell for the tenth consecutive month, reaching their worst level since 2014. Exports dropped 11.1 percent, their lowest since 2012. the central government produced stimulus packages that totaled roughly two-thirds of Japan’s economy. These covered direct funding to individuals along with initiatives such as digital infrastructure and carbon-reducing technology, both with an eye to the shape of Japan’s post-COVID economy, as well as financing and loan guarantees for small- and medium-sized enterprises impacted by the pandemic.
Japan’s roads are getting old. So much so, that certain parts are dangerous. A survey by the Land, Infrastructure, Transport and Tourism Ministry shows that 45,000 bridges and tunnels are waiting for repairs. The figure represents 60% of the structures cited nationwide for restoration. In the post-war years, Japan pressed ahead with infrastructure projects to support a growing population. Officials in Toyama Prefecture, on the Sea of Japan coast, are struggling with a budget shortfall for bridge maintenance.
More than 200 need attention in the city of Toyama alone. Only about a third are getting fixed. The city started more repair work in the year 2020 with an investment of JPY 2 billion, or about USD 19 million. But it only managed to secure about JPY 1.4 billion through municipal funds and state subsidies.
Japan is not only committed to the development of hardware but also of human resources for sophisticated operation and maintenance of the infrastructure. Technological transfer is also conducted for supporting the local people to develop their own infrastructure. As reported in May 2022, TOKYO: Japan, the United States, India and Australia plan to invest at least USD 50 billion into infrastructure projects in the Asia-Pacific region over the next five years to assist projects in the Indo - Pacific region.
In Japan, which is prone to natural disasters, the construction sector is also of great importance for reconstruction and disaster prevention. As natural catastrophes such as floods have caused increasing damage in recent years, affecting annual budgets for reconstruction and disaster prevention, they will likely continue to create demand for infrastructure work.
As of March 2022, Canadian Solar Infrastructure Fund was the leading infrastructure fund listed on the Tokyo Stock Exchange (TSE), with a market capitalization of 47.02 billion Japanese yen. The infrastructure fund market on the Tokyo Stock Exchange was established in 2015 and is based on the regulatory framework of the real estate investment trust (REIT) market. Infrastructure funds listed on the TSE invest primarily in renewable energy facilities, such as solar farms.
Scope of the Report
The transportation infrastructure construction market includes a wide range of construction activities involving reforming the existing constructions, building new infrastructures, and extending or demolishing projects. A complete assessment of the Japan Transportation Infrastructure Construction Market includes an assessment of the economy market overview, market size estimation for key segments, and emerging trends in the market segments in the report. The report sheds a light on the market trends like growth factors, restraints, and opportunities in this sector. The competitive landscape of the Japan Transportation Infrastructure Construction Market is depicted through the profiles of active key players. The report also covers the impact of COVID – 19 on the market and the future projections.
The Japan Transportation Infrastructure Construction Market is segmented By Type (Roadways, Railways, Ports & Inland Waterways, and Airways). For each segment, the market sizing and forecasts have been done on the basis of value (USD billion).
|Ports and Inland Waterways|
Key Market Trends
Impact of Natural Disasters on Roads, Bridges etc.
Japan is one of the most geohazard-prone countries in the world. Typhoons and heavy rainfall, especially during the rainy season every year, often cause geohazard events. Japan is also an earthquake- and tsunami-prone country where many volcanic eruptions also have occurred. Japan is located in the circum-Pacific mobile belt, where seismic and volcanic activities occur constantly. Although the country covers only 0.25 percent of the earth’s land area, it experiences a high number of earthquakes and active volcanoes: It had 302 earthquakes with a magnitude of 6.0 or more in 2004–13, accounting for almost 19 percent of all the earth’s registered earthquakes of that magnitude. (as per the latest available data)
The Road Bureau of the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) has set its main geohazard targets for disaster prevention as earthquakes, heavy rainfall, and heavy snow (and cold). The program for road disaster prevention in Japan is thereby subdivided into programs addressing (a) earthquakes and tsunamis; (b) heavy rainfall; and (c) heavy snow and cold temperature (including prevention of surface freezing).
In order to secure safe and reliable road networks, construction of arterial high-standard highways, urban ring roads and other disaster-resistant roads has begun. Since roads are an important part of disaster relief, measures to respond to and reduce the damages of earthquakes, storms and heavy snows on roads are also being implemented. The probability of a large-scale earthquake, with a magnitude of 6.0 or more, is about 23%. In addition to bridge collapse prevention measures, the MLIT accelerates other anti-seismic measures for expressways and national highways under the jurisdiction of MLIT to prevent a large surface gap, including reinforcement and replacement of supports, based on the probability of large earthquake. In specific, the ministry reinforces support of bridges for immediate recovery from damages and takes other measures where the reinforcement is not possible.
Japan receives twice as much precipitation as the mean amount of precipitation in the rest of the world, especially during the heavy rain and typhoon seasons. Throughout the last decade, heavy rains have increased sharply, thereby increasing the risk of floods. The soft soil easily collapses during storms and is prone to sediment run-off, landslides and other sediment-related disasters. The MLIT undertakes various initiatives to minimize the impact of heavy rainfall on roads and bridges.
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Airports Infrastructure Driving the Market
Successful infrastructure planning will play a key role in the continued growth of tourism in Japan. The association cites the development of Tokyo-Haneda’s international network, the privatization of Sendai and Osaka’s Kansai and Itami Airports; and continuous efforts to improve competitiveness by reducing costs and optimize infrastructure as positive developments. While Japan is a leader in self-service technology for domestic operations, many features are not available for international travelers.
On May 8, 2022, the new Palau International Airport Terminal, constructed through the "Renovation, Expansion, and Management of Palau International Airport Project" (Private Sector Investment Finance), was fully opened in Koror City, Republic of Palau. The existing terminal building at Palau International Airport was constructed in 2003 with grant aid from JICA and has been in use for about 20 years, but with the increase in the number of tourists, there was a need to overhaul the airport’s facilities and functions.
To address these issues, this project saw the construction of a new departure terminal building and renovation of the existing terminal building, now to be used exclusively for arrivals, while introducing Japan's excellent airport operation and maintenance management technologies. This is the largest infrastructure development project in Palau and the first public-private partnership (PPP) project in a Pacific Island country, ever supported by Japan.
On 29th March 2022, Hokkaido Airports (HAP, Chitose City, Hokkaido) announced the 2022 business plan for the seven Hokkaido airports it operates. The investment amount will be JPY 11,230 million, which is almost double the plan for FY2009 (JPY 5.82 billion). It also announced a policy to set up a loan facility of JPY 9 billion for financial institutions in preparation for the downturn in aviation demand due to the new coronavirus. Eighty percent of the investment, or JPY 8.99 billion, will be used for operations related to repairs of airport facilities.
The Japan Transportation Infrastructure Construction Market is fragmented, owing to the presence of major local and international players. Tekken Corporation, TOA CORPORATION, Penta-Ocean Construction, Wakachiku Construction, and Yahagi Construction are among the major players in the market. In the transportation infrastructure market, demand for sustainability and technical developments has increased, and companies are investing to stay competitive. The market is expected to grow during the forecast period due to the increase in the construction investments and up-coming major projects in the country and other few factors are driving the market. The market opens opportunities for upcoming players due to increasing govt investments in the sector.
Aug 2021: Shinnihon Corporation announced that it will conclude a share transfer agreement and make Fujiko a subsidiary. The Shinnihon Corporation Group is developing construction and development projects mainly in the Tokyo metropolitan area.
Nov 2021: Obayashi Corporation, the largest, vertically integrated construction and property development company in Japan and parent company of Webcor and E.W. Howell, and Join Digital, the leader in digital transformation for the built world, have concluded a far-reaching partnership that will bring Join's technology platform to the state of the art new construction projects in both North America and Japan. In addition, the companies announced that Obayashi, through a subsidiary, has made an investment in Join.
Table of Contents
1.1 Study Assumptions
1.2 Scope of the Study
2. Research Methodology
3. Executive Summary
4. Market Insights
4.1 Market Overview
4.2 Market Dynamics
4.3 Government Regulations and Initiatives
4.4 Supply Chain/Value Chain Analysis
4.5 Porter's Five Forces Analysis
4.6 Technology Snapshot and Digital Trends
4.7 Modernization of the Transportation Infrastructure Sector
4.8 Major Infrastructure Development Projects
4.9 Impact of COVID-19 on the Market
5. Market Segmentation
5.1 By Type
5.1.4 Ports and Inland Waterways
6. Competitive Landscape
*List Not Exhaustive
6.1 Market Concentration Overview
6.2 Company Profiles
6.2.1 Obayashi Corporation
6.2.2 Shimizu Corporation
6.2.3 Taisei Corporation
6.2.4 Takenaka Corporation
6.2.5 Tekken Corporation
6.2.6 TOA CORPORATION
6.2.7 Penta-Ocean Construction
6.2.8 Wakachiku Construction
6.2.9 Yahagi Construction
6.2.10 Tokyu Construction*
7. Market Opportunities and Future Trends
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Frequently Asked Questions
What is the study period of this market?
The Japan Transportation Infrastructure Construction Market market is studied from 2018 - 2027.
What is the growth rate of Japan Transportation Infrastructure Construction Market?
The Japan Transportation Infrastructure Construction Market is growing at a CAGR of >5.5% over the next 5 years.
Who are the key players in Japan Transportation Infrastructure Construction Market?
Obayashi Corporation, Shimizu Corporation, Taisei Corporation, Takenaka Corporation, Tekken Corporation are the major companies operating in Japan Transportation Infrastructure Construction Market.