Car park firm NCP collapses with nearly 700 jobs at risk

National Car Parks (NCP) has gone into administration, putting 682 jobs at risk.

The administrator, PwC, said demand for parking had not recovered to pre-Covid levels, pointing to "shifts in commuting and customer driving patterns".

It said NCP could no longer afford to pay its creditors after consistently losing money and was unable to scrap "long-term, inflexible" leases on loss-making sites.

PwC is looking to sell the business as the "best outcome" for those NCP owes money to. "All sites are open, staff remain in post, and trading continues as normal," PwC added.

"We will be engaging with landlords, employees, and other stakeholders as we explore all options."

NCP was founded in 1931 and isone of the biggest car park operators in the UK. It runs 340 car parks across the country, including in airports, hospitals and train stations.

The firm's debts were £305m greater than the value of its assets, as of 30 September last year, according to a filing from its parent company.

Among the options to secure NCP's future is to sell some or all of the company.

PwC said NCP had a "high concentration" of inflexible leases that prevented it from reducing costs or scrapping unprofitable car parks.

Zelf Hussain, joint administrator and PwC partner, said the company had faced "a challenging trading environment" in recent years.

"Our priority on appointment is to ensure continuity of service while we undertake a detailed review of the business."

NCP's parent company, Park24, which is Japanese, said higher energy prices as a result of the outbreak of war in Ukraine in 2022 also put pressure on the business, adding to its operating costs.

It said NCP "pursued new car park developments to support revenue growth", as well as implementing cost-cutting measures, but "structural losses continued".

The company concluded that "no prospect of improvement in its cash‑flow position could be identified".

Gervais Williams, chair of equities at investment management company Premier Miton, said the industry had always been considered a stable part of the high street, but the recent shift to online shopping had hit demand for car parking.

"I think the usage of car parks has gone down, but I think the most important thing about the NCP car parking group is that actually it had quite a lot of debt," he told BBC's Today programme.

"It was making assumptions that it would be able to repay its debt quite happily in good or bad years, but actually it's just had a series of bad years, it can't repay its debt and it's become insolvent."

NCP's parking charges vary across its locations but some central London locations can cost up to £60 for 24 hours.

The British Parking Association, which represents car park operators, said "effective parking management is essential to keeping towns and cities moving", adding that its "thoughts are with the NCP management and workforce at this difficult time".