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Signs are emerging that China’s bike-sharing boom could be hitting road bumps.
On Aug. 18, Shanghai’s municipal transportation bureau sent notice demanding bike-sharing companies refrain from adding new bikes (link in Chinese) to the roads. According to the bureau, the city has 1.5 million sharing bikes on its streets—about one for every 16 residents. The government also demanded that the companies aggressively relocate bikes parked and scattered carelessly across the city—the services let customers return bikes anywhere, rather than only in designated racks.
Authorities in Nanjing, Guangzhou, and Zhengzhou have issued similar directives.
Halting the distribution of new bikes comes around the same time as China’s national-level Ministry of Transportation published the first country-wide framework for regulating the chaotic industry.
Preventing the companies from adding new bikes on the streets is no small hindrance for the industry’s core business model. Generating revenue depends on getting rides, and getting rides depends on making sure bikes are nearby. One way to ensure that a potential rider always has a bike is to put dozens of bikes on every street corner—but that has led to chaos and oversupply.
Capping the number of bikes on the road will help put the breaks on a startup battle that’s spinning out of control. —Josh Horwitz
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