Statistics from the Cheetah big data shows that ofo and Mobike still occupy the majority of the bicycle rental market in the third quarter of 2017, Chinese media Lanjing TMT is reporting. As the weather turns colder, bike-sharing apps may witness usage decline compared to the second or third quarter as many people do not ride bikes in the cold days. This might lead more bicycle companies to consider merging with other companies under “Unite to overcome difficulties (抱团取暖)” strategy just like the case of Hellobike and Youon bike merger.

Cheetah’s shows that ofo and Mobike’s weekly active penetration rate were 0.9419%, 0.8742%, repsectively, taking the first and second place. However, users open Mobike app more than ofo. Comparing the weekly app openings per capita, Mobike users opened the app 30.9 times, while ofo users opened the app 28.4 times.

While third place saw other bike rental players go back and forth, ofo and Mobike stayed firm in market dominance. The second place and the third place leaves a huge gap of weekly active penetration rate. Hellobike and Youon bike showed weekly active penetration rate of 0.0748%, and 0.0283%, listing the third, and fifth, respectively.

2017 3Q bike rental startup App ranking (Image Credit: Cheetah big data)

2017 Q3 bike rental startup App ranking (Image Credit: Cheetah big data)

Now we can divide the bike rental players into three groups based on its average Monthly Active Users. According to iResearch’s mUserTracker monitoring data for the second quarter of 2017, first tier players are Mobike and ofo, with average Monthly Active Users number of over 30 million. The second tier lists more companies such as Hellobike, Youon, and Bluegogo come in with an average Monthly Active Users number of more than 100 million.

2017 Q2 bike rental company user number (Image Credit: iResearch)

2017 Q2 bike rental company user number (Image Credit: iResearch)

Winter comes to bike rental companies

The entire bicycle-rental industry showed a cooldown this year. Since the beginning of June this year, Wukong bike (悟空单车) and 3Vbike have halted its operation while Machi-cho bike (町町单车) also failed to refund the deposit.

Until next year’s spring, analysts say that bike rental companies will face a vicious cycle: venture capital will no longer back these bike rental companies, users will withdraw the deposit, the operation and maintenance costs will go up. In fact Bluegogo failed to give deposit refunds to its users and had to promise a new deadline.

Governments are also putting bars on dock-less bike rental companies. Since June 2017, Chinese cities including Beijing, Shanghai, Guangzhou, Shenzhen, and Nanjing have announced the policy that no more new bikes should be placed in the city. This means that new brands have no chance to enter these mainstream cities, which will allow current players to consolidate the competitive bike rental market.