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Monday, June 27, 2011

BIXI wants to grow, but is it profitable?

CANADA - Toronto's BIXI program has been active for over one month now (it started May 3rd) and according to the Toronto Cyclists Union the cycle-sharing program should triple the number of bikes and expand the current service area beyond the downtown core.

But is there the profits to support such an expansion?

In the first week BIXI was active there was 700 trips. By week 4 there was 28,000 / week.

Most of the demand comes from the edges of the service area, along Jarvis, Spadina and Bloor, thus furthering the logic that BIXI should expand in those regions.

Meanwhile in Montreal the BIXI program owes $37 million to the city and is currently running a $5 million annual deficit. Not that long ago Montreal was running a profit, but has since flip flopped into deficit (possibly due to over expansion into regions of the city where most people don't use bicycles).

So Toronto needs to learn the lessons taught by Montreal. Expand SLOWLY, and only into regions where demand can be shown.

It should be noted that May was very rainy and renting bicycles very much depends on the weather conditions, so those numbers are expecting to rise dramatically during the summer and autumn, before dropping off suddenly in winter.

So far Toronto BIXI has served up 73,000 rides in its first six weeks of service, with only 1,000 bikes on Toronto streets.

Successful bike-sharing programs often have a lot more bicycles than a mere 1,000. ie. The Paris VĂ©lib “freedom bike” program got 1.8 million rides in its first month in 2007, with about 10,000 bikes. But that in PARIS, a city known as a mecca for artists and tourists. Its to be expected to have much higher usage.

Paris hit the 100-million ride mark earlier this month (June 2011), after nearly four years in operation. Paris now has an average of 100,000 rentals per day, with 20,000 bikes.

Montreal's BIXI program currently has almost 30,000 subscribers and 18,000 rides per day on a fleet of 5,000 bikes.

BIXI Toronto so far has 2,240 subscribers and has had 7,000 one-day users, but that isn't enough to support expansion. 6,000 subscribers are needed just to break even.

So Toronto needs to wait a bit longer before they start expanding rapidly. A little bit of expansion in the desired areas would be okay, assuming it drives up usage. If it doesn't BIXI should wait until they reach above the 6,000 mark.

Other bike-sharing programs around the world:

Hangzhou, China
50,000 bikes
2,050 stations
Started in 2009
Plans to have 175,000 bikes by 2020

Paris, France
20,000 bikes
1,800 stations
Between 80,000 to 120,000 rentals per day
Started in 2007

Toronto, Canada
1,000 bikes
80 stations
2240 subscribers, 7000 one-day users
Started in May 2011

Montreal, Canada
5,050 bikes
405 stations
30,000 members
18,000 rides per day on average
Started in 2009

1 comment:

  1. Dublin, Ireland
    550 bikes
    44 stations
    37,500 members
    4,800 rides per day on average
    Started in 2009



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