Bike-sharing provider Bluegogo bankrupt after months of problems: reports

By Chen Qingqing Source:Global Times Published: 2017/11/15 22:03:39

Chinese bike-sharing services provider Bluegogo has gone bankrupt, media reports said, and its major supplier said the company has been struggling with financial difficulties for months.

The company recently announced it will dismiss its entire staff and pay their salaries until February 2018, an unidentified employee of Bluegogo said in a post on social media platforms on Wednesday.

The company has been getting many complaints from users concerning deposit refunds, Bluegogo said in a post on its Weibo account on October 20.

A senior executive of Bluegogo told the Global Times on Wednesday that he had already resigned. The company's PR representative said he has also left Bluegogo.

Chen Anqiao, a bike supplier to Bluegogo, said the company suspended its orders in April due to financial problems. "They could not raise any funds from investors," he said, noting this situation had caused problems for bike manufacturers and suppliers.

"We have accumulated a debt amounted to more than 10 million yuan ($1.51 million) because of the suspended orders," Chen complained.

In spite of the rapid development of the sharing economy, other Chinese bike-sharing companies also failed in 2017. The Beijing-based company 3Vbike closed operations in July after most of its bicycles went missing, presumably to thieves, a month after Wukong Bicycle in Chongqing ended its services.

In August, a bike-sharing company called Dingding ended its services, according to media reports.

Bluegogo had been actively exploring the overseas market earlier this year. However, after it launched services in San Francisco in January, it was criticized by local officials for "dumping" tens of thousands of bikes that cluttered the sidewalks and ended up broken and abandoned, according to the Mercury News based in San Jose, California. 

Two major companies - ofo and Mobike - have seized much of the market, according to media reports. As of this summer, the market share of ofo in terms of active users accounted for 53.9 percent while Mobike had 34 percent, media reports noted, citing industry consultancy iiMedia Research. 

Posted in: COMPANIES

blog comments powered by Disqus