As City's Dockless Bike Trial Continues, 1 Competitor Drops Out

Jul 31, 2018

One of four companies offering dockless bicycles in Charlotte as part of a city bike-sharing trial is pulling out. China-based ofo says it decided to re-evaluate its presence in "markets that present obstacles," including Charlotte.

The company gave no details about what those obstacles might be and added that it's not pulling out of the U.S. entirely, just focusing on what it says are more supportive markets, according to a statement:

“As we continue to bring bikeshare to communities across the globe, ofo has begun to reevaluate markets that present obstacles to new, green transit solutions, and prioritize growth in viable markets that support alternative transportation and allow us to continue to serve our customers.”

ofo says it is also pulling out of other large cities such as Atlanta, Austin, Washington, D.C., and Seattle, according to news reports. In Seattle, the move came after city officials approved new rules and hefty fees - $250,000 per company for the right to put out up to 5,000 bicycles each. 

ofo and other competitors — LimeBike, Mobike and Spin — have put hundreds of bicycles on Charlotte streets since November when the city began its pilot program.  LimeBike, Spin and another company, Bird, also offer rental scooters. They're controlled by apps on users' smartphones that handle payments, track the bikes and open automated wheel locks. Riders can leave bikes and scooters anywhere, which has prompted concerns.

Last winter, residents in some neighborhoods complained about the haphazard way users were parking bikes. City policy requires the bikes to be left in public right of way, but not blocking streets or sidewalks.  

City officials say more than 58,000 people have taken about 192,000 trips since the bicycles appeared. That includes more than 33,000 trips last month, according to a city fact sheet.

The numbers aren't broken down between companies, so it's not known if one brand is more popular than another.

Back in February, City Council member Larken Egleston predicted some companies would exit the market because of competition. On Tuesday, he said he thinks that may be what happened to ofo.

"My anticipation has always been that one or two companies would self-select to leave the market," Egleston said.  

"I actually think that makes it better for the system and the users — fewer companies that users need to download the apps for, fewer companies to call if there's a bike on your lawn," he said.

Bike sharing companies are backed by venture capitalists, who at some point hope to make a profit from the business.  Cory Weinberg, a reporter for The Information, said on WFAE's "Charlotte Talks" Monday that none are profitable yet.

"We are definitely in the stage of being a year into a lot of these companies, particularly in the USA. "Weinberg said. "And I think the investors in these companies aren't yet looking for them to exactly turn a profit. But they want to be able to see that maybe in a city, once they've been there for six months, they can be profitable. And I don't think we've seen that yet."

Charlotte's pilot program ends in October and the permitting process will be up for review by city officials and the City Council. The city says it could decide to adopt new rules for bike sharing, pick a single vendor, or ban dockless bikes from the public right-of-way.

And where are all those unwanted ofo bikes going? Melissa Hayes tweeted this photo the other day from a Charlotte recycling business: 

RELATED LINKS

City of Charlotte Bike Share Pilot Program web page on CharlotteNC.gov

July 30, 2018, WFAE.org, "Charlotte Talks: Are Dockless Bikes And Scooters A Fad, Or A New Era For Transportation?"