SINGAPORE: Even as bike-sharing company Ofo faces cash flow problems, it must continue to ensure that it has enough bicycles for its users in Singapore, said the Consumers Association of Singapore (CASE).
In response to queries from Channel NewsAsia, the consumer watchdog's executive director, Mr Loy York Jiun, said on Wednesday (Jan 2): “There have been reports that Ofo China is encountering cash flow problems.
“Hence, CASE has reached out to Ofo Singapore to request for more information on the situation in Singapore.
"Notwithstanding the above, Ofo Singapore still has an obligation to their existing customers to deliver a minimum level of service - there should be sufficient bikes available to meet the needs of their existing pass holders until their passes expire,” Mr Low added.
Last month, Ofo’s chief executive Dai Wei said the Chinese bike-sharing startup is battling “immense” cash flow problems and disbanding the firm has been considered as an option.
Dai has also been added to China's social credit blacklist, which bars him from buying property or going on vacation.
Ofo, known for its yellow bicycles, has also faced issues in Singapore. The Land Transport Authority had said in November that it intended to take regulatory action against Ofo for possessing a fleet of bicycles beyond its maximum fleet size of 10,000.
Yet, customers in Singapore have expressed unhappiness over the company's operations and some have said there are too few bikes on the streets for use.
Currently, Ofo users who opt for the pay-as-you-go service are charged S$1 for rides of less than 15 minutes, S$1.50 for a 30-minute ride and S$2.50 for an hour-long ride.
Meanwhile, the Ofo pass allows users to pay S$8.99 for unlimited use within 30 days, S$16.99 for 60 days and S$26.99 for 90 days.
Ofo user Eugene Low, who purchased a 90-day pass in October, said that he regretted doing so because he struggled to find bicycles for him to use in his daily commute.
“In August and September, Ofo bicycles were everywhere and easy to find and use. But they have disappeared recently and I’ve given up looking for them,” said the IT engineer.
Disappointed with the company’s failure to deliver, he contacted Ofo Singapore’s customer service in November to cancel his subscription but has yet to receive a response.
Many also posted comments on Ofo Singapore’s Facebook page, some complaining about how they cannot find the bicycles, while some said they have been unable to claim refunds after encountering glitches with the system.
CASE confirmed that over the last three months, it has received five complaints against Ofo Singapore, which were “generally requests for refunds”.
The consumer watchdog's Mr Loy added that existing Ofo pass holders “should be wary” that their subscriptions may be automatically renewed through the mobile application and “may wish to take decisive action” to cancel their subscription if they no longer want to use the bike-sharing service.
“Their notice of cancellation should be documented (for example by taking screenshots) for ease of dispute resolution,” he added.
VENDORS OWED S$700,000, SET TO MAKE POLICE REPORT
According to at least two of Ofo Singapore’s former logistic vendors, the Beijing-based firm owes them around S$700,000 for their services and has not replied to their letters of demand. The two companies were employed by Ofo to handle bicycle transportation, storage and rebalancing, and are looking to make a report with the Singapore police white-collar crime unit, the Commercial Affairs Department.
Mr Kelvin Cheong, chief executive officer for one of the logistics firms that served Ofo, told Channel NewsAsia that Ofo owes his company a total of S$174,000.
“They owe vendors money, and when asked, threaten to hold back payment. We provided them services worth around S$60,000 a month, and then they offered to pay us S$10,000. They keep using the same tactic,” said Mr Cheong, who declined to name his company but would only say it has existed for around 30 years.
Mr Cheong and at least one other logistics vendor, SB Express, are jointly looking to report the matter to the police.
SB Express’ managing director Sebastian Lee told Channel NewsAsia that Ofo owes the firm around S$400,000, and his attempts to contact Ofo’s acting general manager Jack Zhou has failed.
“The last time I heard from him was in November, and he said he needed approval from Ofo’s HQ in Beijing for the payments," said Mr Lee, who provided lorries, personnel and warehouses to fulfil his services to Ofo.
STAFF FIRED ‘OUT OF THE BLUE’
The contracts of hundreds of Ofo Singapore employees were also terminated in November, according to a former senior manager Channel NewsAsia spoke to.
The manager, who declined to be identified, said around 200 bicycle marshalls in November and dozens of its employees who worked at the firm’s registered office address at AXA Tower along Shenton Way had their contracts terminated.
“We worked at level 50 at AXA Tower but I never felt like I was on cloud nine. In fact, people were all in tears after the company retrenched a number of employees out of the blue,” he said.
According to local media reports, the office has been vacated in November, one month before its lease was up.
He added that Ofo Singapore still owes him around S$6,000 in claims, and he, along with other colleagues, have lodged their complaints with the Tripartite Alliance for Dispute Management.
Mr Hazrul Fitri Mohd Yusof, a former Ofo bicycle marshall, told Channel NewsAsia that his contract was terminated in November. His job was to ensure that Ofo bicycles parked indiscriminately in Queenstown were transported back to proper locations.
Mr Hazrul and around 200 other bicycle marshalls who worked across the island were informed by their team leaders “unexpectedly” to return their tools on Nov 7 and return all Ofo bicycles to designated yellow boxes.
“We sort of knew then that it was over, the company was letting us go and their operations in Singapore is ending soon,” he added.
“One thing I’ll say is that they expected us to use 4G data for our work to locate the bicycles but never bothered to reimburse us.”
A third former employee, who worked in operations and resigned from the company in October, said he left because there were “tell-tale signs that Ofo wasn’t going to stay afloat for long in Singapore”.
“Things started to look shaky when the country manager left the company (around mid-2018) and then followed by the regional manager, Alan Jiang. From the second quarter onwards, staff claims and some vendors which provided services for Ofo’s operations (warehouse space, vans and lorries) were not paid promptly,” he added.
He also pointed out that Ofo had left and pulled back on their launches in places like India, London and the Philippines.
Channel NewsAsia has reached out to Ofo Singapore and its acting general manager Jack Zhou for clarification on the company’s financial status, on claims that it owes vendors and former staff money, as well as on how it intends to continue to serve its customers in Singapore.