Monday, November 23, 2009

Spinning Wheels of the Gray Are Now Spinning Gold for JCDecaux

According to a City of Paris press release, on Monday the City Council of Paris approved a new contract with JCDecaux for the Vélib’ bike-sharing system. The last year and a half have seen stressful negotiations between JCDecaux, the giant street furniture advertising company, and the City of Paris—the joint operators of the wildly successful bike-sharing program. The new contract gives a larger financial return to JCDecaux.

Since the program began, there have been more than 61 million bike rentals. In the original contract, 12% of the subscription and rental income went to JCDecaux, while Paris reaped hefty benefits. Now when the rental income goes beyond 14 million, JCDecaux gets 35% of the amount above that level. When the rental income reaches €17 million, they receive 50% of the income above that level. This new financial incentive will give JCDecaux more reasons to maintain the bikes, give better service, and increase the number of customers. They also must decrease the customer service response time to no more than two minutes by phone, plus share location status and maintenance statistics with Paris in real time. In addition, if more than 4% of the bikes suffer irreparable damage, Paris will pay a replacement cost of €400 each up to a maximum of 25% of the fleet. In return, JCDecaux must give detailed reports on the damage to bikes.

It is hoped that this will give a realistic picture of the shrinkage and maintenance problems of the fleet. Now that Vélib’ has expanded to the first outer ring of the Parisian suburbs, the City and JCDecaux are looking at this new contract to help the system become even more prosperous.

image credit: Streetsblog

Russell Meddin


spiderleggreen said...

So now we'll see fewer articles in the New York Times about how it's not working and JCD needs a better deal.

Anonymous said...

This company has just started a share bike network in Dublin and it has being a staggering success. In the first month Sept 09 they got over 12,000 subscribers at the end of Dec09 the got just under 24,000.They hoped for 10,00 in the first year. So far 200,000 bike journies have being made. They are going to expand it as at the moment they only have 450 bikes.
To the surpries of all who live in Dublin only one bike has been stolen in the first few months.