Since Land Transportation Authority, Singapore’s transport regulator, recently announced the licensing scheme for shared bikes.

A S$1500 one time application fee is not onerous on the operators, however, the S$60 (US$45) fee & deposit per bike is apparently too hefty for the operators.

This, plus the fines imposed on inappropriately parked bikes, caused oBike to throw in the towel. We also believe that bigger players such as ofo would find it hardly viable to operate a large bike sharing operation in Singapore.

Ofo runs between 70,000 to 80,000 bikes in Singapore, making the fee & deposit easily S$4.2 million to S$4.8 million.

Graveyards in China

Killing innovation? Well, if you have seen the video below, you would understand why the government would take such a move (before it is too late):

Wu Guoyong, who produced this video, visited more than 30 shared bike graveyards in 20 cities. He used drones to capture the clips and was harassed by security guards multiple times.

The result is visually shocking.

Recycling (the parts of) these bikes would probably cost much more than producing (and deploying) them.

Worse, if the shared bike companies go bust (as it happens with most of them), or do not want to bear the responsibility, the city administration has to do this at taxpayers’ costs.

One estimate puts the millions of disposed shared bikes to be weighing 300 thousand tonnes.

Therefore, it should come as no surprise that the LTA imposes such a fee and deposit, to avoid the public picking up the bills for the operators’ externalities.

 

Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at hello@mworks.asia.

 

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