[sustran] Velib' costs and benefits - Note 2

[Eric Britton]

Well Walter, 3k Euros/bike x 20,600 bikes would give us ca. Euros 60 MM.
That's maybe a number.

 

But I see that not  just for the bikes but for the whole investment, bikes,
stations, software, electronics, development costs, construction, buying of
services, hiring and training of labor, and more. 

 

Bear in mind that while they took all they had done in Lyons as their
starting point, they decided to bet the house on Paris (rightfully so I
would say). And when you check out the details of the system you will
appreciate how very complex and challenging the whole operation  is.

 

If you asked me for my best bet today, I would say Euros 40 MM +/- 15.  But
that's only a guess. 

 

Now that's a huge spread of course, but it would not be surprising if their
figure also included the expenses for putting up, etc. their 1600 new signs
(and see the report, they are huge . . .  , and that indeed is one of the
problems.)  But at this point, who knows?

 

Annual operations and management costs will run, to the best of my memory
this afternoon, about 10-15% of the original investment, covering as you may
recall some 350 full-time job equivalents (they have quite a few part-time
personnel). 

 

And BTW, I count these mainly low skill jobs (but with pretty high social
recognition for what they are dong) as an important plus. Quite unlike most
transportation projects in the pas that have traditionally made "labor
saving" one of their main objectives.

 

We will learn a lot more about this in the months ahead, but the ultimate
bottom line is - I insist - the huge benefits. And this we also have to get
our arms around.

 

All of which points up the importance of separating the two contracts and
giving greater insights as to costs, etc.

 

Yes we want to golden egg. No we do not want to slaughter that perfectly
good goose. (Of course there are always those who just like killing geese,
but I hope not too many of our dear colleagues here.)

 

Eric Britton

 

 

-----Original Message-----

From: Walter Hook [mailto:whook at itdp.org] 

Sent: Friday, 12 October 2007 16:47

To: lwright at vivacities.org; eric.britton at ecoplan.org;
sustran-discuss at list.jca.apc.org; NewMobilityCafe at yahoogroups.com

Subject: RE: [sustran] Re: Velib' costs and benefits - Note 2

 

We read somewhere that the bikes cost something like 3000 euros, which seems

impossible , and we could not confirm it.  There is some fancy electronic

gadgetry inside them to signal mechanical failures, etc, but how could they

be so expensive? Anyone got any intel on this?

 

Walter

 

-----Original Message-----

From: sustran-discuss-bounces+whook=itdp.org at list.jca.apc.org

[mailto:sustran-discuss-bounces+whook=itdp.org at list.jca.apc.org] On Behalf
Of Lloyd Wright

Sent: Friday, October 12, 2007 10:41 AM

To: eric.britton at ecoplan.org; sustran-discuss at list.jca.apc.org;
NewMobilityCafe at yahoogroups.com

Subject: [sustran] Re: Velib' costs and benefits - Note 2

 

It would be interesting to know how much of the 90 million euros is for the
system infrastructure and management as opposed to the cost of the
advertising.  I would imagine the advertising side has both infrastructure,
management, and marketing (cost of attracting and retaining clients)
components.  It would be important to separate out the bicycle system from
the advertising business to understand the costs.

 

Even at 200 euros per bike, 20,000 bicycles only comes to 4 million euros.
The bicycles should have a life of perhaps 7 to 10 years.  Thus, on an
amortised basis, the bikes are only about 400,000 euros per year.

Certainly, the stations are an infrastructure investment (but again with
probably a long life) and there are annual management costs.

 

But it is difficult to see how it comes to 90 million euros.  Thus, I
suspect that the costs of advertising component must be huge.  Also, I
suspect that JCD has an incentive to inflate the numbers as much as possible
to claim the goodwill of their investment.

 

Best,

 

Lloyd