Studies are underway to explore how to introduce the concept of KPIs into the physical distribution industry so allow physical distributors and cargo owners to work in accord to simplify their flow of physical distribution activity.

## (4) Measures for Labor Shortage in Logistics Sector

Under the influence of falling birthrates with aging populations, concerns over shrinking workforces are looming mainly in the trucking and domestic shipping sectors. The MLIT addresses these situations by developing effective public relations campaigns that emphasize the social significance of logistics, by simplifying and automating the workflow of logistics by promoting modal shifts and joint transportation with several shipping companies, and by reducing redelivery and so on. Further, MLIT has compiled a specific package of government-private measures to be taken in the future at its Logistics Problem Survey Workshop and published it as “Action Plan to Counter Labor Shortages in the Logistics Sector.”

## Section 3

## Reactivating Industries

## 1 Trends in Railway Industries and Measures

## (1) Railway business

### a. Trends and measures in the railway business

The number of railway passengers carried in FY2013 increased from its year earlier level. At Japan Railway, transportation on Shinkansen increased while transportation on conventional railway lines increased slightly, with transportation on private railways on the increase.

The volume of railway freight transportation during FY2013 rose from its year earlier level in both the number of tons and that of kilograms carried a year for reasons, such as last-minute demand before the consumption tax increase, truck driver shortage and so on.

The railway operators are working to present guidance information in multiple languages, show route and station names along with their alphanumeric notation, offer free public wireless LAN services and more in their bid to achieve further leaps through enhanced railway competitiveness, collaboration with livelihood services and so on and to better receive inbound foreign tourists. Traffic IC cards continue to gain growing popularity across the nation since their pioneer “Suica” was launched by JR East in 2001. Since March 2013, 10 kinds of traffic IC cards used by JR and major private railways and the like have been made interoperable. As IC cards penetrate more railway operators and areas, they could help improve passenger convenience and reactivate regional economies.

### b. Initiatives towards the complete privatization of Japan Railways

The individual companies of Japan Railways incorporated upon breakup and privatization of Japan National Railways in April 1987 have carried on their respective management efforts to meet their own regional conditions and management climates over the following more than 25 years. In the meantime, East Japan Railway Company, Central Japan Railway Company and West Japan Railway Company were completely privatized when the sale of the capital holdings of Japan Railway Construction, Transport and Technology Agency (JRTT) completed, but measures have been taken for the time being to keep the Japan Railways companies in mutual partnership and collaboration, assure user convenience, care for smaller enterprises and so on in consideration of the background of the Japan Railways reform.

Hokkaido Railway Company, Shikoku Railway Company, Kyushu Railway Company and Japan Freight Railway Company, on the other hand, carry on their respective efforts to increase revenues and cut costs. In the light of the social significance of the roles these companies play, such as securing means of local transportation and driving railway freight transportation having low environmental loads, necessary aids have been extended to them to reinforce their management structure and thus make them economically viable by leveraging funds from the JRTT Special Services Account since FY2011 in accordance with the Act on Treatment of Debt, etc. of JNR Settlement Corporation, in addition to the fixed property tax breaks already in effect.