After a 19-month freeze on new bikes, the southern Chinese city Guangzhou decided it’s time to roll out a new bike-sharing scheme that will give the city a final say in the total number of shared-bikes on its streets.
Guangzhou is inviting bids from bike-sharing companies, according to a notice on the city’s public resources trading centre. The scheme will allow 3 different bike-sharing platform operators to run a total of 400,000 shared bikes in six central Guangzhou districts.
The shared bikes are required to be equipped with smart locks and communication modules that allow real-time location tracking. At least half of the 400,000 shared bikes will have to be new bikes which are put to use for the first time.
The bidders will each need to have more than 100,000 bikes or have at least RMB 30 million capital (USD 4.5 million) for purchasing new bikes.
The notice specifically bars companies that have been involved in legal tussles from participating in the bidding, which clouds the prospects of winning the bid for Ofo, one of the two major players in the city. The debt-saddled Beijing company had failed to repay user deposits.
Guangzhou had issued a ban on putting new bikes on its streets in August 2017. The local transportation committee said the city had a bike-sharing oversupply problem. While many experts estimated that 350,000 to 430,000 shared bikes would be sufficient to meet demand, Mobike and Ofo, at one point, had a total of nearly 1 million shared bikes in Guangzhou.
Mobike and Ofo were asked to scale back their operations in Guangzhou. Mobike removed more than 100,000 bikes and Ofo took back 200,000 from the city, as of September 2018. With this new scheme, whoever wins the government’s bidding process will have to operate within set guidelines.