Bicycle-sharing is back on the news again.
This time, it’s not about bicycles getting thrown into the canal or off a bridge. It’s not even about errant parking.
It’s about ofo raising their prices. And ofo is blaming it on LTA’s new licensing regime.
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LTA’s Licensing Regime in a Nutshell
Bicycle-sharing is a boon and a bane to Singapore. While on one hand, it promotes the idea of a car-lite society and healthier lifestyles, it also created a lot of trouble for Singaporeans as well.
Like anyhowly parking the shared bikes.
Or creating more jobs for the Singapore Police Force (SPF).
Well, the government had enough and decided to put their foot down and came up with new rules for the sharing economy.
Unluckily, bike-sharing companies are the first ones to come under the knife.
From 7 July onwards, bike-sharing companies in Singapore must have a license from LTA in order to operate in Singapore.
Their fleet of bicycles will be determined by the authorities and the companies have to fork out money for a “licensing fee”.
Each bicycle deployed will cost a bike-sharing firm $60, on top of the $1,500 application fee for the license.
Which is Why ofo is Raising Its Prices
It was reported that that ofo’s humongous fleet of bicycles will be reduced to 25,000 from 80,000. We’ll do the math for you.
Amount to be paid for bicycles deployed = $60 X 25,000 = $1,500,000.
Yes. $1.5 million.
ofo said that in order for them to maintain the “level of service” and the “quality of their bicycles” that they offer to their customers, they had to introduce the price increase.
With effect from 9 Oct, ofo bike users will have to pay more than double their previous charges for single rides.
Previously, it only cost $1 for an entire hour’s ride.
But with the increase, you’ll now have to pay $2.50 for an hour’s ride. Here, we’ll do the math for you:
$0.50 (unlocking fee) + $0.50 (first 15 minutes) + $0.50 (first 15 minutes) +$0.50 (first 15 minutes) + $0.50 (first 15 minutes) = $2.50
And if that’s not painful enough for ofo bike users, you’re looking at a higher-priced ride with lower supply.
Ouch.
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SG Bike Unknowingly Burned ofo
Of course, with ofo raising its prices, you’re wondering if the remaining bike operators will follow suit.
Mobike Singapore said they’re reviewing their pricing model but they’ll be looking at generating other sources of revenue before making a decision.
Anywheel said they’re not looking to increase their prices in the near future.
SG Bike’s marketing director, Mr Benjamin Oh, said that they are not raising prices “for the near future”.
He admitted that there are associated costs with the licensing regime but they’re looking for other ways to manage the cost.
We will “not pass them off to our users unnecessarily“.
But whichever it is, you can’t blame them for raising prices. After all, the entire reason why such a situation happened in the first place is because Singaporeans don’t deserve nice things.
Agree?
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