Ofo says it needs more time to downsize fleet as authorities take regulatory action

SINGAPORE — Bicycle-sharing firm Ofo is the first company to be penalised for not rightsizing its fleet to the 10,000 bikes it is allowed under the new licensing requirements, which came into effect on Nov 1.

In a statement released on Monday (Nov 5), the Land Transport Authority (LTA) said that the Chinese company has a fleet size "significantly above" its maximum of 10,000, and or even the fleet size of 25,000 that LTA was originally prepared to grant for its operating licence.

The authority has thus given notice to Ofo of its intention to take regulatory actions for the breach of this licence condition.

Neither Ofo nor LTA would comment on the penalty that it has to pay for the breach. However, in a media release issued in September, LTA said that licenced operators that do not comply with licence conditions will face regulatory sanctions, which may include “financial penalties of up to S$100,000 for each non-compliance, reductions in fleet size, suspension or termination of their licences”.

Responding to LTA’s statement on Monday, Ms Isabelle Neo, country manager of Ofo Singapore, told TODAY that the company has made it clear to the authority that it needed more time to adjust its fleet size.

“Ofo has been clear and transparent in our communications to the LTA that the additional rightsizing of our fleet to 10,000 bikes would require more time,” she said, adding that the firm is confident of being “fully compliant in the coming days” and hopes LTA will consider giving it more time to do so.

She also said that it was disheartening to learn that a financial penalty was so quickly imposed and only on one operator.

Five out of the six bike-sharing firms which were granted licences to operate in Singapore have managed to downsize their fleets to meet a Nov 1 deadline imposed by the authorities.

Last Monday, LTA revealed that Ofo, which was allowed to have a fleet of 25,000 bicycles at first, had asked to reduce that number to 10,000, citing difficulties in meeting its financial obligations under the licensing scheme.