Is Citi Bike In Trouble?

The Wall Street Journal reports that the bike-share initiative is in financial trouble. But…

Is Citi Bike In Trouble?
[Image: Flickr user Dan DeLuca]

Citi Bike, New York City’s bike share program, has been an enormous hit with pedal-pushing Manhattanites and Leonardo DiCaprio. But it might be in trouble. The Wall Street Journalreports today that the transportation initiative’s leaders “are moving quickly to raise tens of millions of dollars to rescue the popular bike-share program as it loses money, according to people familiar with the matter.” Per the report, Citi Bike’s financial troubles are threefold:

  1. People do not ride bikes during the winter.
  2. Tourists aren’t using it.
  3. Infrastructure maintenance–i.e., moving bikes between stations–has been expensive.

The first point was to be expected; who wants to ride in the snow? Here’s a chart to put the winter usage decline into perspective.

What wasn’t expected, however, was how popular the program would be with annual members. Some 99,000 New Yorkers pay $95 for unlimited access to the bikes in 45 minute intervals. But short-term passes were expected to subsidize the program, at least according to the Journal‘s sources, and the number of short-term users has been lower than anticipated due to vandalized kiosks.

That said, it’s worth pointing out that many mass transit systems aren’t profitable, especially bike shares. “I’m not aware of a bike sharing system that covers all of its costs simply from user membership dues and whatever fees you pay for a trip,” John Pucher, professor at the Bloustein School of Planning and Public Policy at Rutgers University, once told U.S. News. The MTA is billions of dollars in debt.

Alternative transportation methods like bike shares serve the public interest in other ways, sometimes alleviating stress on existing systems like rail, reducing air pollution, and providing a means to exercise. As recently as December, Citi Bike was deemed a sterling model of success for how to roll out such a program. And sponsored bike share initiatives in cities like D.C. and Paris also had their initial kinks to work out before integrating into the daily transportation infrastructure. “It’s been excellent for our health and for the environment,” Paris mayor Bertrand Delanoë said a few years ago. These programs are not designed with profit in mind.

Fast Company has reached out to Citi Bike for comment, and we’re told a statement is forthcoming.

About the author

Chris is a staff writer at Fast Company, where he covers business and tech. He has also written for The Week, TIME, Men's Journal, The Atlantic, and more.