On April 15, the Bixi public bike sharing service returned to the streets of Montreal for its 6th season.

It seemed serendipitous that I came across a Bixi station on rue Villeneuve against the Conservatoire de Musique et d’Art de Montréal. The building housing the conservatory has lettering along the walls and the Bixi’s just happened to be in front of the word COMMENCE.

 

 

A great idea that was badly managed

There’s been a lot of coverage in the press about Bixi, unfortunately much of it regarding the financial difficulties of the bike sharing organization that ultimately led to it filing for bankruptcy protection in January. The writing has been on the wall pretty much since the City of Montreal approved a $108 million bailout package in 2011.

While the public bike sharing system has attracted a lot of fans, the Public Bike System Company that was running it, not so much.

After launching in May 2009 the system received great praise and was the recipient of a number of design and innovation awards. With the design and manufacturing all being in Québec, it helped add credence to Montreal being a member of the UNESCO Creative City Network (since 2006). The system gained International attention and has since been purchased by numerous cities around the world.

But everything began to go awry when it was discovered that a public entity was not sanctioned to run a for-profit business. This was a huge oversight since the national and international sales were supposed to help pay for the bike sharing in Montreal.

On top of this, in 2012 a number of technical problems (due to a change in the software that controls the system) were encountered in the rollout in several cities (particularly New York) that led to the delay in launch and subsequent holding back of payments due. Cash flow became a major obstacle, due in part to the international success, but also exasperated by New York and Chicago withholding $5.3 million in due payments resulting from the implementation delays.

 

 

What really bugged tax payers was the news that the company paid employees a bonus for 2013, just prior to going into bankruptcy protection – talk about ‘rubbing salt into the wound’.

I’ve been thinking of creating an infographic showing the events that have occurred together with outlining some of the key statistics and financials of Bixi. But herein lies another major issue. The company has shown a total disregard for transparancy, to the degree of not disclosing year end accounts, despite numerous calls to do so. The company would certainly make for an interesting case study.

A number of companies had shown interest in purchasing the International sales arm of Bixi (including a bid from Alta Bike Share that sells and runs a number of the US bike share programs), but all fell through and it was recently agreed to sell it for $4 million to Bruno Rodi, a local real estate and furniture store entrepreneur but who is probably better known for his globe trotting adventures. It will be interesting to see if he is able to turn things around, but $4 million hardly made a dent in the $50 million Bixi owed creditors at time of it going into bankruptcy protection.

 

Bixi Montreal 2014

Denis Coderre – the Mayor of Montreal – believes in Bixi and has given the local bike sharing scheme a lifeline (at least for 2014) by creating a new organization called Bixi Montreal and providing more money.

The latest cost:

• Purchase of Bixi’s local assets (bikes and stations) for $11.9 million (amount deducted from the $37 million owed),
• Provided Bixi Montreal with a $4.3 million contract to run the service for 2014,
• Short term loan of $460,000,
• A grant of $165,000.

Something that is often overlooked is the money that the city loses in on-street parking fees that are lost due to the space taken by the Bixi stations. I believe I read somewhere that the parking fees lost were in the region of $11 million per year. However, I guess the cars that would have parked in the spots taken by Bixi stations found another paid space, so this is likely an over exaggeration.

At the end of the day though, Coderre has pretty much put the survival of Bixi into the hands of locals (and tourists) by calling on people to use the system more and prove it’s popularity.

 

Reading comments on the web it seems like many (not just here in Montreal) would like to see public bike sharing succeed but are against throwing lots of tax payers hard earned dollars at keeping the system afloat. I personally hope it will succeed and we will continue to see Bixi’s on Montréal streets for many many years to come and that November 2014 won’t see Bixi ARRÊT.

 

Thanks for putting up with my rant. Feel free to share your thoughts and experience of Bixi in the comments.

Thanks for stopping by. Until next time.

– Martin

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