Thursday, September 15, 2011

BIXI Bikes Takes a Bite of the Big Apple

New York City has selected Montreal-developed BIXI to create the largest single bike sharing system in North America. The New York system will be comprised of 10,000 bikes and 600 portable, solar-powered docking stations. Additional stations are also being studied.

BIXI is the first major bike sharing system in North America that offers practical and ecological alternative to traditional modes of urban transport. Dedicated to become a complement to public transport, this service allows citizens to borrow a bike in a station, to travel to their destination and to return that same bike to any other station of the network.

Although a final contract has yet to be signed for the New York deal, an as yet unnamed commercial sponsor will carry the financial risk. Several large corporations have already displayed a strong interest in sponsoring the new system.

The New York service is expected to launch next spring and operate on a year-round basis. To meet requirements of the Buy America Act, Alta Bike Share Inc. of Portland, Ore., has been chosen to operate the system.

Public Bike System Co. (PBSC) of Montreal, a private, not-for-profit company, had initially developed the BIXI approach and launched it in May 2009. Its development from 2007 until last spring was financed by Stationnement de Montréal, a subsidiary of the Board of Trade of Metropolitan Montreal that administers the city’s public parking system.

PBSC will furnish all the bikes and docking stations for New York City. Last May, the value of the New York City contract had been pegged at $41 million. PBSC will also operate the customer-service and technical-support elements of the deal.

“The closing of the New York contract will consolidate our business plan and provide better revenue stability over the long term, while augmenting our company’s credibility on the international level,” said Roger Plamondon, PBSC chairman.

"The conclusion of this contract will also generate numerous orders for our suppliers and the creation of many specialized jobs all across Quebec," said the Mayor of Montréal, Mr. Gérald Tremblay. At present, the activities of the PBSC generate close to 450 jobs in all of the regions of Quebec. these figures will grow with the fresh New York project, Plamondon said.

Montreal-taxpayers have provided $37 million in loans to PBSC and guarantees on a potential $71 million in lines of credit was approved by city council last spring. Tremblay said that PBSC is currently using $2 million of the city-guaranteed line of credit.

Montreal's auditor-general Jacques Bergeron concluded that the BIXI system could lose millions of dollars. The new deal quells criticism about the solvency of the bike system.

"From a financial standpoint, the closing of the New York contract will consolidate our business plan. This contract will ensure greater stability to our long term revenue while boosting the credibility of the [PBSC] at the international level. There will also be positive spin-offs for Quebeckers as the Société will be able to maximize services here in Montreal," said Mr. Plamondon.

The Big Apple is the largest customer yet landed for the BIXI, but the BIXI approach, branded under a variety of names, has been adopted in such cities as London, Washington, Boston, Toronto, Ottawa, Melbourne, Minneapolis, and Chattanooga.

The New York City deal confirms both the success of BIXI at the international level as well as its dominance over the competition.

For more information on the Bixi Bike rental system click here.

© 2011, Richard Matthews. All rights reserved.

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