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

Ian Wingrove Ian.Wingrove at london.gov.uk
Sat Oct 13 01:40:40 JST 2007


 
 
I am unclear on the setting up costs - but the running costs are
estimated at 300 Euros a bike, or six million Euros a year. JC Decaux
also paid Paris a respectable amount of money for the licence. It is
msaid to be a bit of a lost leader, in order that they can win other
contracts. It remains a commercial venture, a successful one and a
scheme which has many more upsides than downsides.
 
Whether a City takes the advertising approach offered by Decaux will
depend upon how much tax payers money the politics are willing to spend
on running it as purely a cycling scheme - minus the advertising.
 
JC Decaux operate 2 other schemes, one in Vienna which has been
operational for 3 years and one in Lyon, France which has been
operational for 2 years. Both schemes have been extremely successful
since being implemented.  

 


*         Launched in 2005 

*         3000 bicycles from 250 stations, 9m hires, 19.7m kms
travelled.

*         15,000 hires a day and almost 60,000 subscribers by the end of
the first year

*         Each bike is used between 7 and 15 times a day by different
users 

*         Three quarters of all rentals are for journeys of less than 15
minutes 

*         A 45% increase in bicycles on the road 

2,400 tonnes of CO2 saved a year 
 
 
 
 

	-----Original Message-----
	From: NewMobilityCafe at yahoogroups.com
[mailto:NewMobilityCafe at yahoogroups.com] On Behalf Of Eric Britton
	Sent: 12 October 2007 17:18
	To: 'Walter Hook'; lwright at vivacities.org;
sustran-discuss at list.jca.apc.org; NewMobilityCafe at yahoogroups.com
	Subject: [NewMobilityCafe] Velib' costs and benefits - Note 2
	
	

	

	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 

	

	

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