Bike Sharing in China - Mobike, Ofo and Xiaoming Bike
Bike Sharing in China - Mobike, Ofo and Xiaoming Bike

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The bike is back! 30 years after China started to switch two wheels to four, people are starting to use bikes again. However, today it is all about bike sharing. Indeed, one of the first pioneers in this project was Mobike, a startup financed by Tencent and Chinese investment firms. The competition in the market is quite fierce. Another major player is Ofo which is banked by the drive APP Didi.

However, these two competitors are not targeting the same market. On the one hand, Mobike is a high-end branding segment with flashy orange wheels, incorporated satellite navigation. At the beginning, the production cost was around 6,000 CNY but now there is a lighter version with a production cost between 200 and 500 CNY per unit. On the other hand, Ofo is focusing on students with their yellow bikes that cost around 250 CNY, and they have a sharing economy model.

A funny fact about Ofo is that you can share your own bike. You can offer its services from one to three years and the company is going to repaint it in yellow and put an Ofo lock and plate on them.

Another competitor in this market is Xiaoming bike. The color of their bike is blue.

How Can We Compare These Three Companies?

Let’s compare their different characteristics:

compare

They are not the only competitors in the market. Another player is Bluegogo:

  • Available in Chengdu, Guangzhou, and Shenzhen their bikes weigh 15kg, they have GPS for localization and use a QR code to unlock them.

According to the latest market statistics, there are 17 other companies that offer the same service. The bike-sharing market trend can be explained thanks to the governmental and private investments that are offered to businesses of this sort. There are other companies such as HelloBike, 1 Step Bikes, Uni Bike /etc.

How Is It Going For These Companies So Far?

So far they can’t really complain. Everything is going smoothly, and they have more and more users even though the competition is quite fierce between the different companies. The latest numbers tell us that Ofo has reached 20 million users and that they have 51.2% share of the market compared to 40.1% for Mobike.

However, there are some downsides. The users of these bikes are leaving them everywhere. They are even leaving them in communal parking spots. That is why the police have to do some heaving lifting with governmental trucks to move the bikes from these specific spots because it can be a burden for residents, shop owners and those who own a personal bike or a scooter.

Another problem has appeared.  These companies have to face other challenges such as the maintenance, management and also the existence of unscrupulous users who damage or disappear with the bikes. We have found some bikes being sold online. These issues, of course, are more of a problem for the small companies with small pockets because it can mean life or death for them. Compared to the bigger players with huge pockets being filled by huge investors (Mobike and Ofo) this isn’t as big of a concern.

 As we can see, the competition in the market is quite fierce. The major players try to have more and more investment from external parties. For instance, Ofo has just secured 430 million USD in its Series D financing. A few days earlier, Mobike also received a new investment from Singapore based Temasek Holdings. It seems to be the main strategy to conquer the market and we can clearly see there is an intense competition between Ofo and Mobike to see which company will get more investments than the other.

Finally, you can see that even for these companies there are some cities in China that are not really bike-friendly. For example, Chongqing which is called “Mountain City”.

What Are The Objectives Of This New Trend In China?

The main "official" objective of this new trend in China is:

  • Reduce the pollution: transport officials in Beijing want to reach 18% of commuters riding to work by 2020.

What Is Their Plan In The Future?

A long-term vision of the Marketing Director of Ofo is to export their bikes to other countries and cities such as London, Singapore, and Los Angeles, and of course be the major player in their own country.

 

What Is Your Next Move?

If you are a two-wheeler enthusiast like us, and would also like to get a piece of the clean transportation action, you know what to do! Just choose the supplier that you prefer. Either because you like the color, it’s cost, or you like their style, but make it a personal decision.

Either way, we are just glad that we could help you take the step over to cleaner transportation. Although, don’t forget to watch your surroundings! Just because you have made the choice to ride a bike doesn’t mean you will get special treatment on the road, therefore please be safe! Moreover, if you have any question about it do not hesitate to contact us.

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