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Bike Sharing Hits Speed Bump as Soaring Costs Force Some Cities to Shutter Programs

Though bike sharing is popular and still sprouting up around the US and beyond, high costs and other headaches have forced 60 services around the world to close.
Photo via Wikimedia Commons

France pioneered bike sharing in the 1970s. Now, the French are thinking twice.

Le Monde recently reported that Paris pays around 4,000 euros ($4,360) a year for each bicycle in its Vélib' service, which lets riders check out and return 16,000 bicycles at self-service kiosks throughout the city for 1.70 euros ($1.56) a day or more for subscriptions. Founded in 2007, Vélib' was based on a 1974 bike sharing program in La Rochelle.


"These are the real costs of implementing and operating the bicycles," Benoît Beroud, founder of Mobiped, a consultancy in Lyon, told VICE News. "It's a very expensive investment. Maybe it's not the best solution to invest in bicycles."

Le Monde said authorities have shuttered 60 bike sharing services around the world — including French cities like Aix-en-Provence and Plaine Commune, north of Paris — due to high costs and other headaches.

The article noted that Barclays pulled its sponsorship of bike sharing in London after a deadly accident, paying only half of the 50 million pounds ($77 million) officials expected to receive from the bank. Montreal had to buy out its bankrupt bike sharing company.

Bike sharing in the United States has hit snags, too.

Late last year, the New York City comptroller found that the Citi Bike program was inadequately inspecting bicycles and letting kiosks malfunction. A few months before, a private company called Motivate had taken over the Citi Bike program after it became clear it was in a financial tailspin.

Related: Citi Bike Is Drowning In Debt, But It's Too Big to Fail

It's no wonder Citi Bike had problems. American-style bike sharing, like its international counterparts, is surprisingly expensive.

The average annual cost of shared bikes in the US is around $5,900 apiece, according to an October 2014 study by the Mineta Transportation Institute at San Jose State University. That figure reflects purchases, maintenance, repairs, software, and "rebalancing," or moving bikes from neighborhoods with gluts to areas that need more.


Despite the hefty price tags, bike sharing is popular and still sprouting up around the United States and beyond. Around 13 bike sharing programs existed worldwide in 2004, the Washington Post reported. Today, there are more than 850.

'Even if the numbers are high, if you compare it to the cost of building new roadways, it's worth it.'

Motivate spokeswoman Dani Simons wouldn't provide information about the company's finances, but she said Motivate has invested heavily in new software and equipment and expects to double the amount of bikes in New York to 12,000 in the next two years. This is in the hope that scaling up the service will raise revenues and reduce costs.

"Citi Bike, when it was first launched, was under-resourced, and it had an issue where the software was glitchy," Simons told VICE News.

Asked if a few thousand dollars was too much to spend on a road bicycle, Simons said it depended on one's perspective. Mass transit systems are lucky if they recoup half of their costs through user fees. Overruns are common in road construction.

"Bike sharing is still one of the most affordable forms of public transportation out there," she said. "You can't compare it to a privately owned bike."

Related: Japan's Incredibly Complex Underground Bicycle Storage System

Experts echoed Simons' remarks. Tally up the costs of building new highways, car pollution, and traffic congestion, and bikes are a bargain, Caroline Rodier, associate director of the Urban Land Use and Transportation Center at the University of California Davis, told VICE News.


"Even if the numbers are high, if you compare it to the cost of building new roadways, it's worth it," said Rodier. "It's all relative. If you think about the health benefits, they're huge from physical activity. We've got climate change we've got to worry about."

At a time when the US Congress is loathe to spend money to fix Amtrak and the country's crumbling roads and bridges, Rodier noted that midsized cities like Sacramento are increasingly looking to bike sharing as a cheap way to make it easier for folks to get around town.

The French have the same idea. Le Monde mentioned that the northern French city of Lille was considering moving bike stations to its surrounding small villages where people are clamoring for the bikes.

Follow John Dyer on Twitter: @johnjdyerjr

Photo via Wikimedia Commons