Replacing Cars With Bikes? Not So Fast

(MoneyWatch)  Trouble has cropped up for a promising idea to reduce pollution and oil usage: public bike rentals in large cities. The world's leading program, the Vélib' rental network in Paris, France appears to be disintegrating.

Inner city driving is inefficient, polluting and above all frustrating, so organizers first came up with government-sponsored bike hiring in the 1960s. The programs started becoming popular this decade, with over a half dozen cities signing on.

Vélib' is the largest yet, with some 1,450 rental stations distributed through Paris. The New York Times has a rundown of Vélib's troubles:

With 80 percent of the initial 20,600 bicycles stolen or damaged, the program's organizers have had to hire several hundred people just to fix them. And along with the dent in the city-subsidized budget has been a blow to the Parisian psyche.

"We miscalculated the damage and the theft," said Albert Asséraf, director of strategy, research and marketing at JCDecaux, the outdoor-advertising company that is a major funder and organizer of the project. "But we had no reference point in the world for this kind of initiative."

Parisian authorities are blaming the damage on the same disaffected urban youth that rioted and burned cars in 2005. One need not look far, though, to find a similar group in any large city.

Part of the problem is that these aren't your standard cheap city bikes. Paris pays over $3,500 per bicycle, kitting them out with special equipment intended to prevent damage and help locate missing bikes. But no matter how well-defended the bikes become, they'll always be at a disadvantage to a determined thief or vandal.

Where to next? Paris is going to continue the program, even though it appears to be bleeding money, and London mayor Boris Johnson has already said he will roll out a similar program in 2010 with 6,000 bikes.

So bike rentals will have another chance to succeed. But if neither London or Paris is successful, it's doubtful that other large cities will be willing to try. In that case, bike hires may well be doomed never to grow beyond the tourist market.