BACK in the 1980s, I would see pictures of China and it would be most likely a street with a sea of bicycles driven by people who wear the same gray or dull blue Mao jackets.
In the last 30 years, however, China has grown tremendously from a backward country to a powerhouse that is now acknowledged as the world’s second largest economy. In the process, it has a world record of reducing its poverty by over 600 million people.
If you go to China today, you would hardly see anybody wearing Mao jackets. People wear all kinds of colors and brands. Virtually all luxury clothing brands are now represented in China, and list them as one of their biggest markets. The bicycles were now slowly replaced with pictures of planes, cruise ships, bullet trains, and all kinds of SUVs, trucks, motorcycles, and luxury cars.
A statistic in Beijing indicated that while bicycles were used in two thirds of travel in the 1980s, it was responsible for less than 20 percent of the travels by 2014.
However, visits to China in the last two years show another trend – the bikes are back. In major cities, you can now see hundreds of brightly colored bikes parked on the curb.
According to Time magazine, close to 20 milion bicycles are now in Chinese streets. This is funded by close to 100 different companies that have a tremendous disruptive plans – you unlock the bike through a smartphone app, and you can use them. For the equivalent of a few pesos, you ride them where you want to go, and after you’re done, just lock them up and wait for other people to just pick it up and use it.
The biggest (or second biggest, depending on who is talking), Mobike, started operations in 2016, and was able to station nine million bikes in over 180 cities in China in just two years. They boasted that their bikes were used up to 30 million times a day, and just a week ago, they hit another milestone when they were purchased by another company Meituan-Dianpin for $2.7 billion.
The other top competitor is Ofo, which also claims close to 10 million bikes, and 30 million trips a day. Ofo is backed by Didi Chuxing, China’s top car ride which beat Uber in china. On the other hand, Mobike is backed by TenCent, which owns Wechat.
This revolution may be unique to China, whose population used to ride bikes 30 years back. While they boast of millions of bikes, New York, London and Paris still report less than 20,000 shareable bikes each.
But the disruption is also not a walk in the park. The third largest bike sharing company in China, Bluegogo, went bust, as did over 30 of the companies with similar business in just a few months.
The other casualty was the bike manufacturers. With bikes all lying around waiting to be ridden without caring whether it was lost or destroyed, and only for a few cents, most people have stopped buying bicycles, which made a lot of manufacturers go bust. The junk yards of many Chinese cities are also full of thousands of broken bikes, many of them broken in just a few days.
That’s how it works. Disruption anyone?