China Might Lead the World Back to the Bicycle
(Bloomberg View) -- It wasn’t so long ago that rivers of bicycle commuters coursed through Chinese cities. As a means of navigating urban roads, two wheels couldn’t be beat. They were cheap (and China was poor), and Chinese cities were compact enough to allow for conveyance by pedal power alone. As recently as 1986, 63 percent of Beijingers used a bike as their primary mode of transportation.
By 2013, however, those numbers had plummeted to 14 percent. Nationwide, bicycle usage declined between 2 and 5 percent annually between 1990 and 2010.
The reason for the drop-off is no secret. Car ownership has surged in China over the last 30 years as Chinese enjoy their new prosperity and look for more efficient and comfortable ways to navigate their ever-more-sprawling cities. Unfortunately, over the last decade that surge has clogged Chinese metropolises with traffic and choking clouds of smog. With roads becoming less navigable by the day, citizens, entrepreneurs and the Chinese government are looking for alternatives.
Bicycles -- and in particular, bike-sharing programs, a utopian concept first tried (unsuccessfully) in Amsterdam in 1965 -- have resurfaced as one of the most promising options. According to Bloomberg, in just the last few weeks China’s two biggest bicycle-sharing services landed $200 million in funding, giving one of them -- two-year-old, Beijing-based ofo -- a $500 million valuation. Didi, China’s biggest ride-sharing company, has invested $100 million in ofo and is exploring whether to fold the service’s 70,000 bikes and 500,000 daily rides into its industry-leading app.
Humble bicycles would seem an unlikely target for China’s tech investors. Not only are two-wheelers unlikely to incorporate much in the way of new technology, but they continue to have a reputation as a backward form of transportation that upwardly mobile consumers have outgrown. In 2004, in an ill-advised stab at modernization, Shanghai banned bicycles from downtown to make the city more comfortable for cars. The attitude behind the move was concisely expressed in 2010 when a contestant on a Chinese dating show told her blue-collar suitor: “I’d rather cry in a BMW than smile on a bicycle.” The statement went viral.
But as China’s traffic and pollution have worsened, the car’s status has started to take a hit and transportation planners have redoubled their admirable commitment to public transit. At the same time, they’re faced with a problem common to their peers around the world: The further a commuter lives from a bus or metro stop, the less likely that commuter is to use public transport. (Generally, commuters will walk farther for trains than buses.) This distance is known as the “first-mile/last-mile problem” and solving it has become a priority worldwide.
In China, bike-sharing is an immediate fix. The Dutch originators of the program started with an idealistic concept: to leave bikes around Amsterdam that anyone could use, for any purpose. Unsurprisingly, many of those bikes were stolen, and the program ended. The next generation of bike-sharing programs didn’t arrive until the mid-1990s, when systems were developed that required identifying magnetic-stripe cards to rent a bike. Variations on those systems now operate in hundreds of cities around the world.
They’ve taken off with remarkable speed in China, where the total number of shared bikes outnumbered the world fleet of share bikes outside of China in 2015. The cities of Hangzhou, Taiyuan, and Shanghai operate the world’s first, second, and fourth biggest bike-share programs, respectively. The scale is astounding: Hangzhou Public Bicycle, which was established in partnership with the local government in 2008, now operates as many as 78,000 bikes at more than 2,000 stations, with plans to expand to 175,000 bikes by 2020. On average, users make 240,000 trips per day.
Preliminary data indicates that China’s beleaguered commuters are willing to give the bikes -- and public transit -- a try. A 2010 study of Hangzhou’s system showed that members had a higher rate of auto ownership than non-members, while 30 percent had incorporated the service into their commute. In other words, many of China’s car owners are willing to opt for a more environmentally friendly mode of transport if it’s readily available to them.
China’s well-capitalized bike-sharing companies are betting that many more commuters will make the same choice. To help them along, ofo equips bikes with a QR code that users scan to pay and ride (ofo rentals run $0.15 per hour, after a $15 deposit). Shanghai’s Mobike is outfitting bikes with GPS units so they don’t have to be returned to a station, but can be left anywhere and are easy to find. Electric and pedal-assist bicycles, already popular in China, will soon be a part of the fleets.
For three decades, modernization in China has meant emulating car-centric countries such as the U.S. Bike sharing won’t be the final word on China’s urban modernization, once driverless cars become a more viable option for solving the last-mile problem. But it does put the country at the leading edge of a form of transportation it was on the verge of abandoning. With luck, it’ll show other cities and countries that the past can be a way forward, too.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
To contact the author of this story: Adam Minter at email@example.com.