[sustran] Velib' costs and benefits - Note 2

[Eric Britton]

A few more pieces of the Euro puzzle from sent on by our friend Ronan taken
from recent articles in the financial press here.  I rough translate and
summarize for you if necessary.

 

1.       From La Tribune -
http://fr.biz.yahoo.com/13082007/155/velib-un-pari-risque-pour-jcdecaux.html
JCD investing 90 million Euros (high figure to date), covering all project
costs but gaining access to those 1600 on-street (sidewalk actually) panels.
Penalties for underperformance on contact specs.  JCD taking a
risk/potential bath on the margins, cause they got to do it.

 

2.       From http://www.marchespublics.net/actualite/edito.php?id=1256 

 – The usual Vélib’ numbers +  guarantee of 285 full time job-equivalents +
all costs for system to be covered by JCD for the ten years of the contract.
+ City of Paris to get all income from bikes + 3.5 Euros paid to city by JCD
year – and all that against 1600 public advertising spaces, which someone
has figured should get them on the order of 60 million Euros/year for the
contract period.  And all that with a system of penalties for failing to
meet performance goals and incentives for doing better.

The author of that piece -- Hervé Huguet, Citia, cabinet de conseil en achat
public – makes the point that in his view the margins are very thin but that
it’s a great showcase for KCD (which for sure it is).

 

That’s one vantage of our ballpark. But it’s really the benefits side that
holds the bottom line (that plus the necessary separation of the deals into
separate 2 contracts).  Which is where I need some help from you.

 

And not in our enthusiasm for a kinder better world to kill the at least
carbon-lite goose of course (as Walter Hook so wisely reminds us).

 

Eric Britton