What happened: The Chinese-language edition of Japanese outlet Nikkei is reporting that ofo plans to withdraw from its current operations in Japan. The bike-rental giant is currently stationed in three Japanese cities: Otsu, Wakayama, and Kitakyushu. The local governments of all three have received notice from the company of its plans to withdraw. ofo reportedly told officials in Otsu, where it has operated for only seven months, that it would end their partnership by the end of October. The company has not yet responded to government requests for confirmation, however. Nikkei reports that fierce competition at home and disorderly parking problems are the main suspects behind ofo’s decision.

Why it’s important: If confirmed, ofo’s plans to withdraw from Japan would fall in line with recent trends for the company. In August, ofo’s Japan marketing director, country manager, and PR manager all left after a reportedly rough six months of operations. And just two days ago, ofo’s founder and CEO stepped down from the position of company legal representative amid an increasing number of lawsuits from allegedly unpaid suppliers. A potential merger with bike rental startup Hello Transtech was a rare bright spot in recent news for the company; although if that falls through, it’ll be a rough road ahead for the cash-strapped, “shared-bike” leader.

Bailey Hu is based in China’s hardware capital, Shenzhen. Her interests include local maker culture, grassroots innovation and how tech shapes society, as well as vice versa.

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