Bike-sharing companies face an uphill ride in US

Co-founders Toby Sun and Caen Contee of California-based bike sharing startup LimeBike show off their bikes at a recently-launched pilot program. (Reuters)
Updated 17 March 2018
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Bike-sharing companies face an uphill ride in US

SAN FRANCISCO: A bike-sharing craze that has swept China over the past two years is picking up speed in cities across the US, but with a different spin as tough local regulations rein in the roll-out of dockless bikes.

Chinese startups pioneered dockless bike sharing: Unlock a bike with your cellphone, ride it, park it, and relock it. But the downside has been bikes piled everywhere in many cities, clogging the sidewalks.

Many major US cities have pre-empted that problem with rules that sharply limit how many dockless-bike companies can operate and how many bikes they can offer in an effort to avoid problems with blocked sidewalks.

Mobike, one of the Chinese bike-sharing giants, has launched in just five US cities and is deliberately moving slowly to work with local communities, according to US General Manager Jason Wong. In Dallas, a city that bike-share companies say is lax on regulation, Mobike has “voluntarily capped” its dockless bike number at 3,000 to make sure the business can thrive in the long term.

Ofo, another Chinese dockless bike-sharing power, will not enter a city without the blessing of local officials, said Chris Taylor, head of the company’s North America business. It is now in 25 US cities, including Seattle, San Diego, and Washington, D.C.

“I think it’s definitely tougher than it is in China but I see that as a good thing,” said Toby Sun, co-founder and CEO of San Mateo, California-based LimeBike. The company put its first dockless bikes on the road in June and has so far raised $132 million from investors, including top Silicon Valley venture capital firm Andreessen Horowitz.

In New York City and San Francisco, dockless bike sharing is all but banned. Both cities have exclusive, multi-year deals with Motivate, which operates the Citi Bike and Ford GoBike services, which use fixed docking stations.

“There’s one city in the US that didn’t have any regulation and that’s Dallas, and quickly had more than 20,000 bikes that were not being used very often and so now they’re looking at what kind of regulation they want to adopt,” said Ryan Rzepecki, CEO of electric bike-sharing startup Jump Bikes.

“There’s going to be some regulation and that does impact the growth.”

Jared White, a spokesman for Dallas, said the city is getting ready to roll out permits and is considering imposing a fee on bike-sharing companies.

Meanwhile, cities with bike-share docking stations are considering what to do next. San Francisco has given a permit for electric bike-sharing to Jump Bikes, though it is limited to 250 bikes at the start.

New York City is considering dockless bikes for areas that are not serviced by the Citi Bike program. Nice Ride, a non-profit in Minneapolis that has been running a bike-sharing program for the past 8 years, has signed up Motivate to help run the docked bikes and roll out a dockless program to test the new concept.

Beyond the cautious city officials, bike-sharing companies face the challenge of getting Americans accustomed to driving to pedal instead — especially when the public transit options are far inferior to those in the biggest Chinese cities.

But the uphill ride is not worrying investors betting on so-called last mile solutions – bikes, electric bikes, and scooters. Just last week the electric scooter-sharing company Bird, which was founded in the fall of last year and has already had to pay fines to the city of Santa Monica for leaving scooters around town, raised $100 million in a series B funding.


Global carmakers show off SUVs, electrics as China promises reforms

Updated 2 min 29 sec ago
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Global carmakers show off SUVs, electrics as China promises reforms

BEIJING: Global carmakers touted their latest electric and SUV models in Beijing on Wednesday, as China promises a more level playing field in the world’s largest auto market where domestic vehicles are making major inroads.
Industry behemoths like Volkswagen, Daimler, Toyota, Nissan, Ford and others are displaying more than 1,000 models and dozens of concept cars at the Beijing auto show.
Thousands of Chinese auto enthusiasts are expected to wander the halls of the mega exhibition center this week, with electric cars and gas-guzzling sport-utility vehicles grabbing the spotlight.
Nissan presented its first Made in China electric car produced for Chinese consumers, the four-door Sylphy Zero Emission, with a drive range of 338 kilometers.
“The new Sylphy Zero Emission is the next step in our electrification strategy for China,” said Jose Munoz, Nissan’s chief performance officer, adding that the company will unveil 20 electrified models over the next five years.
Auto executives may have their minds on the boiling trade war between Beijing and Washington, with every twist and turn fanning fears that it could bring their plans for China to a screeching halt.
But last week Beijing announced it will liberalize foreign ownership limits in the sector, a move seen as a possible olive branch to President Donald Trump, who has railed against China’s policies in the sector.
China currently restricts foreign auto firms to a maximum 50 percent ownership of joint ventures with local companies.
The changes will end shareholding limits for new energy vehicle firms as soon as this year, followed by commercial vehicles in 2020 and passenger cars in 2022.
Foreign automakers who account for more than half of vehicle sales in China have cautiously welcomed the changes, with VW saying it has “strong” local partners in their joint ventures.
“This will have no impact on our JVs. But the overreaching principle is important. Hopefully, liberalization will as well help for fair competition, and having a level playing field,” Jochem Heizmann, CEO of Volkswagen Group China, told reporters.
The show comes as China’s market hits a transition period — the explosive growth in car sales seen over the last decade slowed last year and data from early this year point to a continued slump for many vehicle types.
Chinese consumers are following their American peers toward SUVs while policymakers in Beijing push an all-electric future.
Ride-sharing is also on the up. On Tuesday Didi — China’s answer to Uber — announced it had joined forces with some 30 partners, including Renault and Volkswagen, to develop vehicles and products specifically tailored for ride-sharing.
Accounting for some 28.9 million car sales last year, the Chinese market could soon match those of the European Union and United States combined.
General Motors sold over four million cars here last year, more than in the US. Volkswagen sold more than three million, roughly six times its home market.
But domestic firms are outselling foreign firms in the SUV segment.
In the electric car market the figures are even more lopsided, as Beijing has heaped money on projects to dominate what it sees as the future.
At the auto show, the domestic upstarts have a separate exhibition hall mostly to themselves — 124 of the 174 electric car models on display are homegrown.
Government subsidies help consumers purchase the green cars, while policymakers are planning a quota system to force producers to build electric vehicles, with plans to one day phase out gas vehicles altogether.
Volkswagen announced Tuesday investments of €15 billion in electric and autonomous vehicles in China by 2022.
“China is our second home,” recently installed chief executive Herbert Diess said at a Beijing press conference, with its market set to be “the biggest” worldwide for electric cars.