Ofo users to pay more, as shared-bike firm first to raise prices under new licensing regime
SINGAPORE — Over a week after authorities announced that six shared-bike firms would be granted licences to operate here, China-based firm Ofo has raised its prices by up to three times — a double whammy for its users who now also have a smaller pool of bicycles to tap on.
Ofo is the first operator here to introduce price changes after the Land Transport Authority announced in late September the successful bids under a new licensing regime.
Those who opt for the pay-as-you-go service will be charged 50 cents per unlock, over and above a rate of 50 cents per 15-minute block, said the company in an announcement on its new rates on Tuesday (Oct 9).
This means any ride less than 15 minutes will cost S$1, while a 30-minute ride will set a user back by S$1.50. Users previously paid 50 cents for each 30-minute period.
A one-hour ride will now cost S$2.50, more than double the previous rate of S$1.
The Ofo pass will cost S$8.99 (30 days), S$16.99 (60 days), and S$26.99 (90 days), up from its previous pricing of S$6.99, S$15, and S$25, respectively.
Ofo Singapore’s country manager Isabelle Neo told TODAY that the firm has had to adjust the pricing of its Ofo pass and single rides due to the introduction of a licensing fee by the LTA.
“This is to ensure we maintain the quality of our bikes, as well as the level of service we’ve been able to provide our users,” said Ms Neo.
Under LTA's new licensing framework first announced in May, bike-sharing operators have to fork out S$60 for every bicycle deployed — comprising a licensing fee and security deposit — on top of a S$1,500 application fee.
On Sept 28, the LTA announced that SG Bike, Mobike and Ofo will be awarded full licences to operate here at the end of this month. Three other firms — Anywheel, GrabCycle and Qiqi ZhiXiang — will be given sandbox licences, which are handed out to companies without a long-enough record of operating shared bicycles in Singapore.
However, the new licensing regime, which was introduced to curb indiscriminate parking, also meant that operators would be required to downsize their fleets. TODAY previously reported that Ofo’s 80,000 bicycles would be capped at 25,000, a number that the firm said would not be “sufficient to facilitate the high demand for bike-sharing in Singapore”.
Other licensed operators told TODAY that they have no immediate plans to increase their prices.
Mr Benjamin Oh, SG Bike’s marketing director, said that no decisions have been made to raise prices “for the near future”.
“While there are associated costs with the licensing regime, we will definitely be looking into other means to manage the costs, and not pass them off to our users unnecessarily,” he added.
Mobike Singapore country manager Sharon Meng said the firm is “currently reviewing (its) pricing model”, but the firm did not provide further details.
However, the Chinese operator added that it is “currently exploring other sources of revenue such as corporate sponsorships and advertising”.
Homegrown player Anywheel said that it would not be raising its prices in the near future, while ride-hailing firm Grab said it had waived subscription fees and deposits for users who were registered with its GrabCycle bicycle-sharing marketplace. It had done so after its partner, oBike, abruptly pulled out of the Singapore market in June, affecting user experience on its platform.
Chinese firm Qiqi ZhiXiang could not be reached for comment.
YAY OR NAY?
Users of bike-sharing services whom TODAY spoke to had mixed reactions to Ofo’s price hike.
Mr Joseph Edlin, who uses Ofo’s bicycles about four times a week to run errands and get around, said the price hike would not deter him from using the service.
“I would switch only if there were not many Ofo bikes around,” said the 28-year-old recruiter, who added that he would consider its competitors if they had more bikes.
Agreeing, polytechnic student Aloysius Ong said that Ofo had the “best coverage” in Singapore, and that he preferred it to the competition as its bicycles are lighter, and of a better quality.
“It’s almost everywhere,” said the 19-year-old, who uses the service for his part-time delivery work.
However, he was concerned that the price hikes would eat into his earnings. Mr Ong, who uses shared bicycles about five days a week, said he would switch to Mobike if Ofo “continues to increase its prices”.
Unlike the other two customers, private tutor Yang Qihui, 32, said she would not be using Ofo as she felt the price hike was unjustified.
“I’m unhappy about the price increase as a short five-minute trip will cost as much as a 15-minute trip,” said Ms Yang, who preferred a pay-per-minute system.
Ms Yang, who uses the service regularly to get around her Clementi neighbourhood, has had a spate of bad experiences with bike-sharing firms, including being charged for faulty bicycles.
She added: “I will give up shared bikes for now, as there aren’t many competitors’ bikes around my area.”
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