Beleaguered Bixi will ride again in Montreal
Published Monday, March 24, 2014 6:42PM EDT
Last Updated Tuesday, April 22, 2014 9:54PM EDT
It’s unclear when the familiar bicycles will reappear on Montreal’s streets, but the city announced Monday it will be taking Bixi for another ride this year.
The beleaguered bike-sharing company will be under the banner of a new not-for-profit organization called Bixi Montreal.
The city took over the bankrupt company in January and had to weigh the options of keeping it on the road.
In the end, Mayor Denis Coderre says it was worth it.
“I believe that if I didn't do anything we would have lost over $50 million - we would have scrapped the season and it would have been that's it that's all, and the over 50,000 subscribers would be out of the loop,” he said.
This year will be Bixi’s sixth season on the road. Last year, the service expanded, adding 50 new docking stations to its repertoire including some in cities such as Westmount and Longueuil.
Still, at the close of the season, the city’s auditor general confirmed attempts to beef up the service did little to quell the company’s financial woes.
It was revealed the Public Bike System Company, which runs Bixi in Montreal, was millions of dollars in debt.
In late January, facing $47 million of debt, the company filed for bankruptcy protection and asked the city to take over the service.
At the time, Coderre said it was “out of the question” for the city to spend more money on the service,
Two years ago, the city of Montreal loaned the company $37 million, with $71 million in loan guarantees.
At the beginning of February, the interim head of Bixi, Michel Philibert, was laid off along with 11 other employees.
The job losses came soon after it was revealed Philibert was one of 39 employees to have received a bonus from the company, despite its financial issues.
The new management has $4.3 million to run this season and study whether bike sharing can be a viable business.
Suzanne Lareau of Velo Quebec will sit on the board of the not-for-profit, and says they're motivated to make it work.
“We have to look at bike sharing as a public transit. And Montreal put money in public transit and we have to maybe convince the town of Montreal to put money in the bike sharing system,” she said.
Still, they're not expecting a profit this year, according to Pierre Desrochers, president of the executive council.
“But what could we do or should we do to make sure there is one in the future. That will be part of this mandate,” he said.
Crucial to its survival will be increasing the number of subscribers and sponsors. The fares and the locations will be the same as 2013.
But if that doesn't work, Coderre says Bixi will be cut off for good.
“You don't pull a flower to make it grow faster so I'm going to let them to do their work. I'm open for the future. But what I'm saying is (the city will be) generous, not naïve.”