Shanghai transportation authorities jointly announced on August 18 that no more new bikes should be placed in the city, taking a firmer stand in its moves to crack down on bike rental services, our sister site TechNode Chinese is reporting.
“Upon the announcement of this regulation, all bike-rental companies should place a halt on introducing any new bikes in Shanghai. Violations will be booked in Enterprise Credit System as a severe breach,” according to the statement.
The bike-rental schemes may have provided a greener alternative to China’s clogged public transportation, but they have also created serious headaches for local transportation management institutions. Given that most cyclists opt for whichever bike that’s most accessible on the street, the war between the competitors mainly takes the form of dumping more bikes on the street. As the land-grab battle heats up, however, the overwhelming number of bikes has paralyzed existing bike parking and management. The situation is worsened by illegal parking on the sidewalk or street by careless riders.
This is not the first time for Shanghai authorities to crack down on the bike rental companies. Six leading bike rental companies including Mobike and ofo were asked to suspend bike placement in the city’s central districts early this March, shortly after the government seized over 4,000 illegally parked bikes.
As of February this year, over 30 bike rental startups placed a combined a combined 450 thousand bikes, the country’s largest rental bike fleet, in Shanghai. Now the number more than tripled to 1.5 million, far exceeding the saturation point of 500k bikes, according to Guo Jianrong, secretary of the Shanghai Bike Association.
The disparity in distribution also contributed to the situation. Although bikes have become a nuisance in some downtown areas, it is hard to find them in some rural areas in the city, at least when you want to use them. Bike rental firms are relying on AI to solve this problem. In April, Mobike launched “Magic Cube”, an AI data monitoring platform that’s able to make accurate forecasts of supply and demand for its bike-rentals and provide guidance to bike dispatching, scheduling, and operation.
Shanghai is not a single case. Several first- and second-tier cities such as Beijing, Tianjin and Hangzhou also launched or are preparing to issue similar regulations to control the negative side effects of the bike rental boom.