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rfmcdonaldBixi Toronto, the privately-owned city bike rental agency that appeared a couple of years ago here in Toronto and has sibling agencies elsewhere (for instance, Ottawa-Gatineau), is apparently in significant financial trouble.
The problem was summarized by blogTO's Chris Bateman.
NOW Toronto's Ben Spurr reports, after Public Works chair Denzil Minnan-Wong, that Bixi's parent company wants to shut the Toronto operation down. Torontoist's Hamutal Dotan notes that the problem with Bixi Toronto may be that it's too small.
Below is a picture of the Bixi station at Yonge and Dundonald, one I'd posted a couple of years ago. I've never used Bixi myself because I own a bike, and I am sad to hear of the service's problems.
Here's to hoping Bixi Toronto lasts the year.
The problem was summarized by blogTO's Chris Bateman.
Though the city says the scheme has been "very successful," attracting 4,630 paid subscribers and more than 1.3 million bicycle trips since 2010, the parent company PBSC Urban Solutions seems to be struggling to generate income during cold winter months.
When it started, the City of Toronto provided a 10-year, $4.8 million term loan to BIXI for the purchase of equipment. As of December 31, the balance of the loan was $3.9 million. The report says the troubles are related to an "unsupportable debt load" and a "seasonal cash flow shortage."
A confidential attachment to the report details ways the city could alter its arrangement with BIXI to best protect its assets in the event the company is unable to repay its debt.
The Montreal-based company is currently in the process of selling its New York City, Melbourne, and Boston contracts as part of an agreement with the city and Quebec government. The City of Montreal loaned BIXI $37 million in 2011 and extended $71 million more in loan guarantees and credit lines.
NOW Toronto's Ben Spurr reports, after Public Works chair Denzil Minnan-Wong, that Bixi's parent company wants to shut the Toronto operation down. Torontoist's Hamutal Dotan notes that the problem with Bixi Toronto may be that it's too small.
Mike Layton (Ward 19, Trinity-Spadina) is a big proponent of Bixi, and says that the problem may be that the system is much smaller than it needs to be in order to hit a threshold of financial viability. “The original [City staff] report suggested that we needed to get up to a certain number of bikes and stations to make it sustainable at all, so why is this a surprise that it’s not sustainable at a third of the [size]?” He remains convinced that Toronto needs a bike-sharing system, and thinks most of his colleagues on council won’t use this financial issue as an excuse to try to shut Bixi down. “I don’t suspect that will be the case—it’s been fairly successful. A lot of tourists use it, a lot of local folks use it, so if we’re talking about trying to attract tourists and make this a city that people want to come and visit, this certainly is one of those pieces.”
When City staff first set out a vision for a bike-sharing program in Toronto, they laid out something that was much more ambitious in scale than what we ended up with. That plan called for 3,000 bikes servicing an area that stretched from High Park in the west to Broadview in the east, and from Bloor to Lake Ontario. The agreement with Bixi, when it was eventually settled on, included a plan for the 1,000 bikes we have now as an initial phase, with an eye to expanding the system as time went on. That expansion never came.
Below is a picture of the Bixi station at Yonge and Dundonald, one I'd posted a couple of years ago. I've never used Bixi myself because I own a bike, and I am sad to hear of the service's problems.
Here's to hoping Bixi Toronto lasts the year.
