— Lee Colleton (@sleepylemur) February 16, 2016
As a Car2Go competitor makes ready to make its move in Seattle, the City Council could be ready to rescue Seattle’s bike share system and put Pronto on track for an expansion in 2017 with a committee vote on Friday.
A year after the Seattle City Council voted to allow three more “free-floating car share” vendors to join Car2Go, a BMW-backed competitor to Daimler AG’s Car2Go service is preparing to launch in Seattle after folding operations in San Francisco last year.
CHS has learned DriveNow has started hiring for its Seattle operations and is in the midst of setting up a downtown office. DriveNow’s all-electric BMW i3s were also spotted driving around Belltown this week. According to SDOT, DriveNow has not yet filed for a special parking permit that would allow drivers to park cars without paying street meters — a key component to free-floating car shares.
A spokesperson for DriveNow told CHS the company is “exploring the potential” of operating in a number of cities, but declined to comment on the recent hires or the cars seen in Seattle. DriveNow CEO Rich Steinberg previously said service would start in mid-2015.
Launched in Munich in 2011, DriveNow currently operates in several European cities. After its 2013 launch of U.S. operations in San Francisco, the company closed up shop last year citing insurmountable problems with the city’s parking regulations.
Meanwhile back on two wheels, the city’s bike share plan appears to be to keep the system outside of the for-profit business sphere. Unless the City Council approves a $1.4 million rescue package for Pronto by March 30th, the system goes belly-up. Transportation committee members will once again be considering the deal during their Friday afternoon meeting.
UPDATE: Committee chair Mike O’Brien decided to delay a vote on the plan until early next month so council members could focus on gathering more information.
SDOT director Scott Kubly and head of active transportation Nicole Freedman — who both have experience managing bike share systems — urged council members to support bikeshare in Seattle. Kubly said that adding more bikes in the city makes biking safer overall and said concerns that bike share won’t work in Seattle are unfounded given similar systems operate in some 500 cities worldwide.
The current plan would transition Pronto’s ownership from the third-party nonprofit that launched it to the City, pull it out of the red, avoid paying money to the feds, and put the system on track for a 2017 expansion. Seattle would acquire all of the assets owned by Puget Sound Bike Share under the deal.
Acquiring the system without expanding it would cost the City roughly $110,000 a year after 2016. If the system did expand, Freedman said SDOT would spend the rest of the year negotiating new sponsorship deals to help subsidize the cost.
In October, CHS reported on the City’s plans to take over Pronto to stabilize an underused system, expand it to more of the city, and transform the fleet into a new generation of bikes. A federal TIGER grant allowed the City to get a head start by purchasing 28 of the system’s 54 stations. Since then, details of the system’s financial failures emerged. City Council analysis explains what happened:
Seattle’s current system, operated by Pronto, is insolvent for several reasons. In this system, operations are outsourced to a third party (unlike other bike share systems) and this creates substantial overhead costs. Additionally, insufficient funds were raised for the initial equipment purchases and consequently, borrowing costs lead to ongoing debt service payments that contributed to year-end net losses.
But as the Seattle Bike Blog reported, former PSBS executive director Holly Houser had a different take on what went down. The biggest cause of the showdown, Houser told SBB, came from City’s miscommunication and delays in taking over the system. Despite the pricier-than-expected buyout, City Council transportation chair Mike O’Brien has said he thinks a takeover is still the best course of action.
$5 million in Seattle’s 2016 budget was approved for expanding the Pronto network next year. SDOT officials say bike share is most effective at scale, offering the highest possible number of connections and serving the broadest range riders. Previous planning called for Pronto to expand to cover all of Capitol Hill to 23rd Ave, much of the Central District, parts of south Seattle, the U-District, and Green Lake. SDOT predicts trips could nearly quadruple under the expansion:
Here is a look at how other cities have improved through expanding their systems:
Car share cruising
Car2Go currently has 750 vehicles permitted for its service — the maximum allowed by the City for an individual provider. With four vendors, that means Seattle could have up to 3,000 free-floating cars on the road. SDOT is currently reviewing its permitting policy and is expected to have a new director’s rule out in the coming months.
As part of the regulations, DriveNow could have up to 500 vehicles concentrated anywhere in Seattle or 750 that must be accessible citywide, which would need to happen after two years in any event.
As chair of the transportation committee, O’Brien said he had not heard any firm plans for DriveNow to enter the market or that Seattle’s regulations were keeping companies from coming here sooner.
“I expect if (Car2Go) is profitable, more vendors will come,” O’Brien said.
“I don’t believe there is any reason to provide any subsidies for this.”
SDOT is currently studying the usage of popular transportation-network companies like Uber and Lyft and how they factor into Seattle’s overall car share market.
As with the bike share, SDOT is also attempting to widen Car2Go’s ridership among lower income drivers by offering free minutes to people who receive utility discounts. “It will expose the community to one more alternative to getting around,” said SDOT’s mobility programs manager Cristina Van Valkenburg. The credits are expected to be made available this month.