Japanese regional banking group Senshu Ikeda Holdings' entry into the reservation-based transit bus business is aimed at stimulating the regional economy, President and CEO Atsushi Ukawa said in a recent interview.
"Even regional banks in urban areas must think about serving the local community," Ukawa said of the first reservation bus operations by a regional bank in Japan.
He said that the Osaka-based company will work with local governments to expand the operation area to complement public transport.
Senshu Ikeda operates an "on-demand bus," which uses artificial intelligence to run according to users' desired dates, times and locations. It partnered with companies, including auto parts maker Aisin, to launch the bus operations on a trial basis in four municipalities in Osaka Prefecture in January 2023. It has since introduced full-fledged paid services in some areas.
Ukawa said that the business has been met favorably by more people than expected.
Securing regional modes of transport for elderly people is a pressing issue in Japan, as fixed-route bus services are being scrapped or reduced due to the shrinking population. Senshu Ikeda aims to build a business model in which the main source of profit is commission fees from municipalities that consign bus operations to it.
"Many local governments are interested in (the business)," Ukawa said. "Specifically, there are one or two more cases likely to go ahead within the year."
He added that the company is in talks with around 10 municipalities. Senshu Ikeda plans to expand operations possibly to neighboring Hyogo Prefecture.
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