Where is Vélib 'going?
The shared bicycle service comes out of a year 2020 marked by record levels of use.
Since the start of the health crisis, even in the middle of winter, more than 100,000 trips have been made every day at Vélib 'in Greater Paris.
The network now has 410,000 unheard-of subscribers who share 19,500 bicycles in Greater Paris, a third of which are electrically assisted.
At first glance, for the operator Smovengo, things would seem to be better, after two chaotic first years of contract (in 2018 and 2019).
And yet, this is far from being the case.
In financial difficulty, the company has threatened the sixty or so municipalities that form the Autolib Vélib 'Métropole (SAVM) union to shut down if a substantial budget extension is not granted.
Electric bikes: popular but expensive
Smovengo, which has around 400 employees and subcontractors, improved its service in 2020. But its operational costs are very high.
"We are living a paradox: the more users we have, the more money we lose because of maintenance costs", confides an internal source.
In particular: the intensive use of electric bikes.
The blue Vélib 'represent 35% of the fleet but nearly 60% of the races.
Each is used up to 20 times per day, resulting in accelerated wear and increasing maintenance costs.
The operator also pays for his past mistakes.
In 2018 and 2019, the SAVM deprived Smovengo of substantial sums (22 then 6 million euros), for breaches of its contractual obligations.
This start, completely failed, was also attributable, according to a report from the regional audit court, to the lack of anticipation and preparation of the transition between JCDecaux, the previous operator and its successor by the SAVM.
"Bad management in the past"
According to the weekly Le Canard Enchaîné, Smovengo is now claiming a 50% increase in the sums paid by the SAVM.
It would require that its annual budget increases from 40 to 60 million per year, or a total "bonus" of 240 million euros over the remaining 12 years of the contract.
An "amendment to the contract" is indeed being negotiated with Smovengo.
"But the amount of 240 million mentioned by the Duck has no kind of reality," says Sylvain Raifaud (EELV), the new president of the SAVM, also elected from the 10th arrondissement of Paris.
There has been mismanagement in the past, we are not going to go back on it.
This rider will not be used to make up for the penalties imposed ”.
A unique economic equation
It prevents.
This close negotiation sheds light on the unique economic equation of “Vélib '2”, a public service whose existence and future depend largely on subsidies from the communities on which it depends.
The Smovengo contract, unlike Decaux, is not backed by the management of the Parisian advertising market.
Revenue from subscriptions is collected by the SAVM, and not by the operator, who receives the same amount regardless of the number of users and customers.
The boss of Smovengo, Stéphane Volant, appointed last summer, is negotiating to obtain the means to increase the perimeter of Vélib ', and to face a strong increase in demand.
His ambition?
Achieve 1 million subscribers by 2025. But this objective necessarily involves an increase in its annual subsidy.
Tariffs revised upwards?
David Belliard (EELV), the transport deputy of the City of Paris, which provides 70% of Vélib 'funding, welcomes this proposal with caution.
The elected representative first pleads for a "sustainability and improvement" of the service but not "at any price".
"We are ready to make an effort to extend Vélib, but at reasonable levels".
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For users, changes should arrive from 2021. Last December, the SAVM voted to increase the fleet from 35% to 40% in electric, as well as the creation of 100 new stations.
The park could thus reach more than 21,000 bikes.
Another novelty under study: a price change to encourage users to favor mechanical bicycles for short journeys, and thus less use the electric models.
With their sights set on an increase in revenues from a service at rates now considered "ridiculously low" by some elected members of the SAVM.
In ambush, JCDecaux threatens the Vélib 'union
JCDecaux, the operator of Vélib 'between 2007 and 2017, does not seem to have digested yet to have been excluded from the renewal of the market four years ago. In a letter sent on January 6 to elected officials of the SAVM, Decaux threatened the union with an action before the administrative court. Reason: according to the former operator of Vélib ', the upward renegotiation of the Smovengo contract would call into question the validity of the call for tenders concluded in 2017 by the City of Paris. If the SAVM grants an extension to Smovengo, "this will lead to reversing the classification of offers in favor of our proposal, rejected in 2017 for the sole reason, for the sole reason that it was then more expensive", by around 28%. Contacted, JCDecaux "does not ask that the market be canceled and does not call for a new call for tenders", however specifies a spokesperson for the company. "It's com", this letter has no legal value, we react at Smovengo. For the record, Decaux has negotiated no less than four amendments to its contract ”.
