Bikeshare pricing charts of the day

By Felix Salmon
May 15, 2012
New York's expensive bikeshare scheme last week, I got a lot of pushback from people saying that I was missing the point.

" data-share-img="" data-share="twitter,facebook,linkedin,reddit,google" data-share-count="true">

When I wrote about New York’s expensive bikeshare scheme last week, I got a lot of pushback from people saying that I was missing the point. These bikes are designed for short trips around town, at a marginal price of zero: the large sums you pay if you keep them checked out for an hour or more are a deliberate attempt to discourage that behavior.

OK, fair enough — but in that case, if you’re charging high variable costs, the converse should be that you should charge low fixed costs. Most bike schemes work in much the same way: you pay a certain amount up front for membership, be it for a day or a week or a month or a year, and then the variable per-hour costs on top of that. If New York’s bikeshare scheme is indeed quite cheap, then one would expect the variable costs to be low.

But they’re not.

Ben Walsh put together some numbers for me, for various cities around the world with bikeshare schemes. Not all cities work in exactly the same way, and some have no direct comparison points with New York at all: in Chicago, for instance, the membership options are 1 month, 2 months, and 3 months. In any case, here’s what we managed to find, for New York’s three options:

1day.png

1wk.png

1yr.png

It’s pretty clear that New York is at the top end of the range, here: only Frankfurt rivals it in price. To have access to New York’s bikes for one day, you need to spend $9.95 — that’s more than six times the £1 one-day membership in London, and it’s significantly more, too, than you’d pay in Washington or Toronto or Paris.

The first reaction of New Yorkers, when they hear this, is surprisingly positive: they think of it as a tax on tourists, and everybody likes taxes on tourists. Let the tourists pay through the nose for their one-day memberships, and we locals will save loads of money, through an implicit cross-subsidy, on our one-year memberships.

But that doesn’t seem to be the case, either. Look at the cost of one-year memberships, and New York is still top of the league table, at $95. That’s the same as Toronto, and more than seven times what Romans pay. (Indeed, the one-time membership fee in Rome, at €10, is barely more than a daily membership in New York.)

New Yorkers, then, are being asked to spend much more money per year than bikeshare users in just about any other major city — even if they never take out a bike for more than 45 minutes. And what worries me is the deterrent effect that these prices will have.

The first trip you take, on one of the new New York bikes, will cost you at least $10, and possibly as much as $95. Cab rides don’t cost much more than that, and you can fit four people in a cab. Experienced urban cyclists like me will definitely cough up the $95, even if that hurts a little, because we know how convenient it can be to be able to take one-way bike trips in Manhattan, especially if it’s going to rain later, or if you don’t like biking back in the dark, or if you got in to work on the subway but then just need to go a mile or so to your lunch meeting.

But the great promise of the bikeshare scheme is that it will get people onto bikes who have never biked before — people who are generally very nervous about biking at all on busy urban streets. Those people are going to want to try before they buy, and the $10 cost of a trial one-day membership is high enough to give them a good excuse not to bother.

The East River Ferry is a great example of the benefits of low entry costs and the opportunity the city’s bikeshare program is missing. When the ferry was reintroduced last June, it was free for the first 12 days. Passengers flocked and even once full fares kicked in, it remained far more popular than planners projected.

That said, from a user’s perspective there are two costs worth considering before you opt into one of these schemes, and the dollar cost is only one of them. The other one is convenience — and on that front, New York’s 10,000 bikes look as though they’re going to be everywhere you might want one, so long as you stay south of 60th Street; there are even a few docking stations in Queens! In that respect, getting on a bike is (fingers crossed) going to be much easier in New York than in most other cities — and I can definitely see how that convenience might be worth paying for.

I don’t think the pricing for these bikes is going to cause the plan to fail: New Yorkers are used to paying lots of money for convenience. I just wish there were some cheaper way of getting New Yorkers to try these things out. Because $95 is enough money — roughly the same as an unlimited monthly transit pass — that a lot of people will simply not bother.

14 comments

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/

So what your issue comes down to is that the “try before you buy” cost is too high. Fair enough, though this didn’t pose an issue here in Montreal (which is sort of the progenitor of NYC’s program), where Bixi seriously took off as soon as it was introduced. By the way, Bixi costs CAD $80, but is only available from April to November. I gather New Yorkers will have access to bikes year-round. Of course, all Montrealers pay for Bixi in the form of taxes…

Of course a “free bikes” weekend at the start of the campaign would be both helpful for prospective members (though you have to worry about network strain driving people away) and would serve as a major publicity campaign for Citi and the Bikeshare program. My suspicion is that it would be hardly necessary.

Posted by joeyberger | Report as abusive

Providencia, a borough of Santiago, Chile, has bike share for $4 a month or $30 a year with no fee per hour. There are even people who take the bikes home. There aren’t all that many bike terminals, but it’s not bad. And the price is right!

Posted by Setty | Report as abusive

I’m thinking, like joeyberger (and like Felix, with his example of the East River Ferry), that some promotion could be done at the beginning of the program that doesn’t impact the long-term pricing scheme and encourages immediate use. It’d be even better if such a promotion didn’t affect the “tourist tax” aspect of the program much.

(Yes, our tourists get taken for a ride and we don’t mind it at all since many visitors seem not to mind that arrangement, especially the ones from overseas who benefit from favorable exchange rates.)

That said, I’m going to buy in for a year on day 1. I’m not the typical NYC resident (I regularly ride a road bike for more than 10 miles a day, in the pursuit of fitness and transportation) but I’m sure there are enough of us avid bike riders to seed a bike share system with 10,000 initial units. The dream scenario is that 10,000 bicycles are not enough, since that may have ripple effects for transportation politics across the region that could have enormous progressive benefits for everyone. (Except people who drive regularly in Manhattan and can’t bear to give up a second of free-flowing driving time. Poor John Cassidy.)

Posted by BrianVan | Report as abusive

I don’t understand why an already committed urban cyclist would spend money on such a thing. When I lived and worked and biked everywhere in Chicago, I rode my bike everywhere I went because I wanted my bike nearby in case I needed to go somewhere. (In the college town where I go to school, I do the same thing.)

But if it’s targeted to occasional users, I really can’t imagine a rational pricing scheme that would discriminate between occasional users who are New Yorkers and those that are tourists.

Posted by JamesLiu | Report as abusive

“The first trip you take, on one of the new New York bikes, will cost you at least $10, and possibly as much as $95. Cab rides don’t cost much more than that, and you can fit four people in a cab.”

While I think your argument is more nuanced, (Yes, NYC’s programs is one of the more expensive ones in the world), I still think you don’t quite get it, based on the above quote. I can tell you from experience that most cab rides EASILY cost more than $10, and you don’t always have three friends waiting to share a ride with you, and most people make more than one trip per day. If you do have three friends, and that’s the only trip you’re making that day, then obviously the taxi makes more sense. Everyone looking to save a buck would choose taxi in that case.

However, there are many many instances, where bikeshare is the obvious choice in terms of convenience AND price, despite the relatives high fees. I was going to start listing off a bunch of couter examples, but there are so many instances where this is the case that it’s not really worth it. The fact that you need to hypothesize very specific situations where bikeshare is not the best option kind of proves the opposite point: that it is usually a really good option. That is the point of the system: adding another option for NYC transportation. Sure it’s on the high-end compared to other cities, but for $95/year, or even $10/day, the benefits to me (and you) are easily worth the price, and I think many many others will feel the same way.

Posted by JacobMatthew | Report as abusive

I agree that NYC’s bikeshare is just about the most expensive in the world, but I’ll give the pricing scheme the benefit of the doubt until we’ve seen the system live for some time. Perhaps the people launching the bikeshare predicted, in their infinite wisdom, that the initial demand would be overwhelming if the prices were any lower, leading to customer dissatisfaction. ;-) Ideally, the system should be very popular, but not so popular that it becomes nearly impossible to find a bike or a dock.

Of course, if it’s “too popular”, I hope they’ll expand it accordingly!

Posted by qrt145 | Report as abusive

Your comparison is still off because the NYC system has NO FINANCIAL SUBSIDY from city funds. Every other bike share system in the world has been partially subsidized by city funds.
Also, your example of “the first ride is $10″ is flat-out wrong. Your first ride, 1-44 minutes long, is FREE with your membership. Members become accustomed to planning their routes to be short and direct. The bike share system is designed for such short trips, keeping bikes in circulation.
Like another commenter, I am an avid cyclist and I will be purchasing an annual membership for myself and my wife on day one. We both own bikes, but having access to bike share will give us a new way to get around near our homes and places of work.
But, despite all of this discussion, you don’t like the pricing structure, you don’t need to sign up! My guess is that there will be at least 1,000 annual members within the first 24 hours of the launch, and probably ten times that amount within the first week or two.

Posted by BenfromBedStuy | Report as abusive

Hard to remember a cab ride that didn’t cost $10 when tip was included.

My only wish was that the upper east side was included in the initial roll-out. This neighborhood is far from the Lexington Avenue subway, and could really use a transportation system like BikeShare.

Posted by HamTech87 | Report as abusive

I’m not sure you can compare New York to Toronto and Rome in any meaningful way. Annual memberships in Toronto and New York both cost $95, but Toronto has about 1,000 bikes to New York’s 10,000. Yes, New Yorkers will pay seven times what Romans pay, but they have access to 50 times the number of bikes, 10,000 versus 200.

Boston’s annual membership is $10 cheaper than New York’s, but Boston closes down for the winter. Chicago’s B-Cycle has just six stations and costs $55 for three months!

Are New Yorkers really “being asked to spend much more money per year than bikeshare users in just about any other major city”? Only if you look at bike share through a very narrow lens.

Posted by Walking | Report as abusive

Agree with walking here. A key point you only touch on in this article is how the value of your membership relates to the system size. I think after Paris and Hangzhou (China), NYC will have have the 3rd largest system in the world. More bikes and more stations means it’s more useful – a justification for higher cost. You are comparing the membership price to bike share systems 1/40th of the size. Rome has a paltry 200 bikes at 19 stations. No wonder it’s cheap – it doesn’t get you very much. Frankfurt has just 300 bikes at 30 stations. Toronto has 1,000 bikes/80 stations. Mexico City has 1,200 bikes/90 stations. Washington, D.C. has 1,200 bikes/140 stations.
http://en.wikipedia.org/wiki/List_of_bic ycle_sharing_systems

New York will have 10,000 bikes at 600 stations! It’s a whole other league of service. You can ride further, go more places, reach more people and more destinations. You should be comparing it with London and Paris, yes, but also Hangzou, and maybe Barcelona and Montreal as well, but even those systems are only half as big. Throw in the 45 free minutes instead of the standard 30 minutes and I think you are still talking about a great price in NYC, again especially considering it’s a totally unsubsidized system.

Posted by Heoore | Report as abusive

I think it’s still cheap! I’ll take the yearly subscription and won’t need to take the subway anymore to go to work (except when it rains). So if I compare monthly metrocard and bikeshare, it’s a sweet deal.

My only worry is the execution: will they have the resources to properly allocate bikes so that they can handle rush hour… It took some time in Paris to calibrate. In that sense, it’s good if the pricing scheme is expensive to tourists and occasional bikes.

Posted by MatNYC | Report as abusive

As a DC user of Bikeshare, I gotta say the pricing is fine. I pay $75 for a year and that is all–all my trips are under the time limit. While I own no bikes, my cyclist roommate owns three but still uses Bikeshare often because you can go one way, you can easily combine with other forms of public transportation, and you don’t have to worry about storing your bike and worrying about theft.

I’ll also add that, while I wouldn’t say no to more public subsidy, that $75 gets a lot. A wide network of stations and bikes. Maintenance on those bikes so they remain in good shape. Crews to re-balance bikes from full stations to empty stations. My $75 doesn’t come close to covering what I get, which is why the public subsidy is important as is the cost to tourists.

Posted by LittleMac | Report as abusive

I believe the pricing is fair, it’s cheaper then most cab fairs and putting gas in your car put together. Plus look at the bright side you get to work out more which means your spouse will love you more as your body starts looking great. Me, myself I love bikes, I purchased a bike from http://www.bikesxpress.com and now I can ride all the time. I love it!

Posted by bikesxpress | Report as abusive

layout to get people’s focus,with fair price and original package deal! thanks for visiting store shopping along with us! less costly Longchamp Eiffel Tower Hand bags outlet may be worth you buying!

Posted by traducator daneza romana | Report as abusive