DSC
Superstar
Member Bio
- Joined
- Jan 13, 2008
- Messages
- 19,372
- Reaction score
- 27,355
- Location
- St Lawrence Market Area
Is this going to change things here?
MONTREAL - The president of bike-sharing service Bixi announced he will quit after five years at the helm, saying he can no longer guarantee that Montreal taxpayers won’t have to shoulder its deficits.
Radio-Canada reported that Roger Plamondon thinks it’s impossible for the service to remain financially independent from the city if it can’t profit from its international sales.
Plamondon’s decision was confirmed by Michel Philibert, spokesperson for Société de vélo en libre-service (SVLS), the company that manages Bixi.
Since the provincial government ordered Montreal to sell off Bixi’s international sales arm – the most profitable part of the system – Montreal may be stuck with its deficits.
Bixi borrowed $37 million from Montreal to find its expansion, and secured a $71 million loan guarantee.
And instead of a $2 million profit this year, the service will be left with a $3 million deficit despite a 25-per cent increase in users, Plamondon told Radio-Canada.
City hall had promised that taxpayers would not have to swallow the debts, as sales of the Bixi systems to other cities would eventually pay the shortfall.
Ariane Lareau, spokesperson for the city of Montreal, said “this changes nothing for Montrealers,” but did not comment on the financial details of the service. She said the city is negotiating how the debts will be handled.
She added that Plamondon won’t leave until the contract to install the system in New York City is complete. Bixi announced in September that it would provide 10,000 bikes and 600 stations to America’s largest city later next year.
Bixi took a lashing this summer after Jacques Bergeron, the city’s auditor general, listed a litany of mistakes by Bixi’s creators and administrators: there was no business plan, feasibility study or risk analysis done before the bicycle service was set up. Bixi ended up costing far more than it should have, Bergeron’s report said.
This negative media exposure may have cost Bixi some sales internationally, Plamondon noted. Of the 9,000 bikes it hoped to sell this year, it only moved 5,600.
rrocha@montrealgazette.com
© Copyright (c) The Montreal Gazette
Read more: http://www.montrealgazette.com/news...cial+warning/5698849/story.html#ixzz1dV8Il8GF
MONTREAL - The president of bike-sharing service Bixi announced he will quit after five years at the helm, saying he can no longer guarantee that Montreal taxpayers won’t have to shoulder its deficits.
Radio-Canada reported that Roger Plamondon thinks it’s impossible for the service to remain financially independent from the city if it can’t profit from its international sales.
Plamondon’s decision was confirmed by Michel Philibert, spokesperson for Société de vélo en libre-service (SVLS), the company that manages Bixi.
Since the provincial government ordered Montreal to sell off Bixi’s international sales arm – the most profitable part of the system – Montreal may be stuck with its deficits.
Bixi borrowed $37 million from Montreal to find its expansion, and secured a $71 million loan guarantee.
And instead of a $2 million profit this year, the service will be left with a $3 million deficit despite a 25-per cent increase in users, Plamondon told Radio-Canada.
City hall had promised that taxpayers would not have to swallow the debts, as sales of the Bixi systems to other cities would eventually pay the shortfall.
Ariane Lareau, spokesperson for the city of Montreal, said “this changes nothing for Montrealers,” but did not comment on the financial details of the service. She said the city is negotiating how the debts will be handled.
She added that Plamondon won’t leave until the contract to install the system in New York City is complete. Bixi announced in September that it would provide 10,000 bikes and 600 stations to America’s largest city later next year.
Bixi took a lashing this summer after Jacques Bergeron, the city’s auditor general, listed a litany of mistakes by Bixi’s creators and administrators: there was no business plan, feasibility study or risk analysis done before the bicycle service was set up. Bixi ended up costing far more than it should have, Bergeron’s report said.
This negative media exposure may have cost Bixi some sales internationally, Plamondon noted. Of the 9,000 bikes it hoped to sell this year, it only moved 5,600.
rrocha@montrealgazette.com
© Copyright (c) The Montreal Gazette
Read more: http://www.montrealgazette.com/news...cial+warning/5698849/story.html#ixzz1dV8Il8GF