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After price increase, bike locker usage plummets

Last year, WMATA raised the annual fee for a bike locker at a Metro station from $70 to $200 last July. It was the first increase in 32 years. Today, many of the lockers sit unused.


Photo by Mozul on Flickr.

According to Metro staff, as of spring 2010, about 65% of bike lockers were rented. After the 2010 price hike, lockers are now 41% rented.

Out of the Metro stations that have bicycle lockers, only two of them (Court House and Huntington) are 100% rented. There are 14 sets of lockers that have a less than 20% occupancy rate.


Number of lockers rented and available by station. Stations with the highest percentage rented are at the top. Data from WMATA. Click to view spreadsheet.

During last year's budget debate, WMATA staff said the $200 price would bring the price in line with inflation over the 32 years. They estimated the hike would contribute around $200,000 per year to the system's revenues, but with the usage drop, Metro has brought in only about $46,000 more this year.

The launch of Capital Bikeshare may also have cut into the locker demand. Commuters who store bicycles at urban stations to ride to work may now be able to use CaBi, at least when its stations are not empty or full.

According to Washington Area Bicyclist Association (WABA) Executive Director Shane Farthing, "these disproportionately large fee increases came with absolutely no improvement to the [locker rental] program, and many renters simply allowed their contracts to expire."

"WABA is confident that Metro will evenutally reach the conclusion that the system needs fixing," Farthing added, "not because they love bikes per se, but because it makes economic sense for them to encourage people to arrive at stations in a less space-intensive manner [than automobile parking]."

At some stations, the lockers may not be the best use of space. Though 10 of Dupont Circle's 12 lockers are rented out, they all might be more appropriately replaced with additional bike racks, for instance. At stations in less dense areas, there is plenty of room for the lockers, and WMATA should strive to maximize the usage.

So as not to scare away potential customers, Metro should make bike locker prices reflect the unique market conditions at each station by reducing prices when lockers aren't being used. A good start would be to cut the price at stations where less than 80% of the bike lockers are paid for. A good longer-term strategy would be to maintain a waiting list at each station, and increase the price of the bike lockers when the waiting list gets too full.

In the long term, it may not be possible to fill all of the bike lockers at low-demand stations, even when the price is so low it doesn't cover the administrative costs. In that case, Metro could look into removing some of the lockers and devoting the space to free racks or other purposes.

Metro spokesman Dan Stessel said that responsibility for bike lockers and racks had been recently transferred to the planning department, which is analyzing the lockers as part of its bike parking census.

Disclosure: The author rents a bike locker at Eastern Market, which currently has a 45% occupancy rate.

Michael Perkins blogs about Metro operations and fares, performance parking, and any other government and economics information he finds on the Web. He lives with his wife and two children in Arlington, Virginia. 

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Your data is flawed, what about the high % of unusable lockers due to the lack of resources dedicated to fixing/replacing lockers? Ask the "Planning staff" how much capital that are putting into replacing lockers, and how much they og=ffered in the past?

by Mitch on Aug 5, 2011 12:05 pm • linkreport

Hellooooo WMATA? what upkeep do you perform on these boxes? are you charging extra to create MORE bicycle parking? From $70 to $200 in a single sweep? extreme! I want to see WMATA get away with that fare raise on metro users or garage users.

by La Molkas on Aug 5, 2011 12:06 pm • linkreport

Hmm, if I recall, the esteemed author welcomed the increase -- would make more available.

I don't get the bike locker at all. Replacing them with bikeshare stations would be a huge win. Or racks with cameras for some security.

When I see pricing like this, I think the authority wants to kill the business.

by charlie on Aug 5, 2011 12:07 pm • linkreport

@charlie: Que? Please provide a citation for where I said an across the board increase would be good? I might have called for a local increase to reduce waiting lists for certain stations.

by Michael Perkins on Aug 5, 2011 12:11 pm • linkreport

I asked for my locker to be repaired and they did it. Doesn't look great (they used bondo and fiberglass mesh) but it no longer has a hole where people shove their trash.

by Michael Perkins on Aug 5, 2011 12:12 pm • linkreport

Performance pricing is the way to go here. Although it's also right that, in urban stations where space is at a premium, they should carefully consider whether lockers are the best use of the space.

I also think they don't advertise this service much. Is there even a sign on most lockers about how to rent them? If so, it's not very prominent. Simply issuing an occasional press release or tweet about their availability would probably pick up customers considerably. They could also network with local groups to advertise to their members -- say, negotiate a 10% discount for WABA members in exchange for advertising to their members.

by Gavin on Aug 5, 2011 12:14 pm • linkreport

A disclaimer?!?! How journalistic.....

A variable rate on rentals based on usage... how does that work when you are contracted in? The lockers at Silver Spring were broken more than they were in use... so maintenance has been an issue for eons.

The drop shows the 130$ increase is not supported by the consumer. An entity almost triples the fee for usage... and usage drops. Shocking this is not.

What exactly is the point of a wait list when no one is waiting?

How has increased bike commuting hurt the locker business? Has the completion of the MBT increased complete bike-commuting instead of mixed commuting?
In the DC core, how has CaBi influenced locker rental?

by greent on Aug 5, 2011 12:17 pm • linkreport

@mperkins; my bad, then.

It seems as if the real issue isn't pricing, it is marketing, usage and location.

Although I still don't "get" them. For urban areas, bikeshare would seem better. Ok, for far suburban stations maybe they have some use as a last mile replacement.

Wasn't the fare increase as much about homeless people as it was about biking?

by charlie on Aug 5, 2011 12:21 pm • linkreport

@greent: I just didn't want the implication that I'm advocating for cheaper service when I would benefit from that change to be a surprise.

The variable rate would be that the price that's being offered to renewals or new customers would change based on how many lockers are available. I wouldn't expect Metro to change this rate daily or monthly. Perhaps quarterly would be often enough to react to change without requiring too much work. Annual might be good enough too.

Once the prices drop there might be some more demand. Unlike with street parking where you don't want the spaces to completely fill up (because the extra cars searching for a space impose a congestion and pollution cost on the rest of us), there's not really much of an externality associated with having a short waiting list. So the price should drop until there's a few people waiting to get a locker. But not too much of a waiting list.

The rest of your questions are probably unanswerable based on the data we have, which is very little. Apparently Metro was not doing much tracking before this year, or at least I was told the data is not available because it no longer exists.

In terms of broken bike lockers, the information I have available said that as of spring of 2010 was that: 65 percent (838) have current contracts, 15 percent (190) are out of service due to key problems or physical damage, 4 percent (55) are pending evictions, and 16 percent (203) are available for rental.

by Michael Perkins on Aug 5, 2011 12:27 pm • linkreport

There are a couple of other things I think are keeping rental rates down, even if they do not necessarily account for the recent drop:

1) The lockers are not well-labeled. Some people may not even know what they are.

2) Even when people know what they are, they may not know how to rent them or what the cost is. None of this information is provided on the lockers themselves.

by Jim on Aug 5, 2011 12:36 pm • linkreport

" Metro has brought in only about $46,000 more this year"

You throw around "only's" pretty liberally. How about only increased revenue by 78%. Under the old pricing scheme WMATA brought in about $58,000. Under the new price schedule the revenue is $103,800. Not a bad bit of business. You don't want WMATA to be accused of giving away valuable real estate to special interests. Now let's start pricing the parking lots accordingly.

Since there is a surplus, WMATA should convert some of the lockers to daily or hourly use like it's done in the SF bay area.

by Tom on Aug 5, 2011 12:41 pm • linkreport

@Tom, I agree 100%! WABA is just that - a special interest group - who likes to fudge their numbers. I was at a Basic Bike Maintenance class at REI in Fairfax and the instructor handed out "Bike to Work" brochures and told us all to register - even if we had no intention of biking to work. She said "that's how WABA gets funding and how some access decisions get made." Nice!

Metro raised the bike locker fee to increase revenue - not promote greater usage. Appears they succeeded! Good for them!

Metro's Planning Office is just as guilty of fudging data --like an expensive bike access study that talked to 50 bike advocates -- that's not skewed is it? There are a whole lot of people that would like to see the bike lockers pulled to make way for vehicle parking!

by Mitch Murphy on Aug 5, 2011 12:52 pm • linkreport

@tom: The "only" was in comparison to the budget numbers presented to the board: "Raise the price almost 200% and you'll get an extra $200,000 to balance the budget!"

In reality, $46,000. So, ONLY about 25% of the original intent.

Metro's budget is about $1.3B annually for the operations side.. That's $1,300,000,000.

by Michael Perkins on Aug 5, 2011 12:59 pm • linkreport

Thanks for the follow-up Michael.

by greent on Aug 5, 2011 1:06 pm • linkreport

Get outta here! Talking about more stuff I didn't know.

Metro has bike lockers for rent?

WOW! What do they look like?

by HogWash on Aug 5, 2011 1:08 pm • linkreport

I am a longtime Court House resident and I have never seen lockers near the metro. This prompted me to check out the WMATA website, which indicates they have RACKS but not LOCKERS. Who is incorrect here?

http://www.wmata.com/getting_around/bike_ride/parking.cfm

http://www.wmata.com/rail/station_detail.cfm?station_id=96

by Court House Resident on Aug 5, 2011 1:13 pm • linkreport

@Court House Resident: Obviously the 8 people they got to pay $200 a year for bike lockers that don't exist. :)

by Michael Perkins on Aug 5, 2011 1:15 pm • linkreport

Regarding the budget numbers, I don't see where the $200,000 number came from. The only way they would have gotten an additional $200,000 would be to have increased the capacity to 100% at the new price. As it is, they've increased their revenue from bike lockers by over 40% so it seems the price increase is justified.

by Tim G on Aug 5, 2011 2:00 pm • linkreport

Didn't I read when they made this change that a good portion of the rented lockers were rented to the homeless? Maybe the drop in rentals is due to pricing out these people who only used them for storage?

If that is the case, I think that would be a good thing. Time for WMATA to clean them up and bring in variable pricing to match demand.

by SB on Aug 5, 2011 2:04 pm • linkreport

@Tim G: Oddly enough, you can't even make an extra $200k from 1280 lockers by changing the price from $70 to $200. There aren't enough lockers. You get $156,000 if you assume 1200 lockers increase by $130 each.

Nevertheless, it came from this budget document: http://greatergreaterwashington.org/post/4894/wmata-budget-deep-dive-part-3-fare-proposals/

It might have been a rounding error, but the budget number was given to two significant figures, implying it was accurate to the nearest $10,000. If it was $0.2M, then maybe it could have been $160,000 really. But this was $0.20M, which implies between $204,999 and $195,000.

by Michael Perkins on Aug 5, 2011 2:10 pm • linkreport

I think the tiered pricing system based on usage sounds pretty difficult to administer across multiple stations. And I think the price increase should be viewed in the perspective of value, not of past pricing. A dedicated locker for under $17/month? That seems like a pretty good deal. It also makes the tiered idea seem less viable... how much lower (or higher) would you want to make prices?

by JMC on Aug 5, 2011 2:11 pm • linkreport

@Gavin, et al.

Definitely agree. I lived in DC and used the metro for years before I found out what those big boxes were for. I assumed they were maintenance storage or something until one day I saw someone putting a bike into one. Thought literally never crossed my mind that it was a bike locker I could rent.

$200/yr doesn't seem like a bad price to me. In fact, I would be cool with paying that (or more) if I was trying to decide between a house next to a station or one farther away that cost a lot less and didn't want to get a car.

The problem here isn't that supply and demand disagree on a price point. It's that Metro hasn't informed demand that there IS a supply (or how to go about renting the lockers), so there's no market.

by Ronald on Aug 5, 2011 2:21 pm • linkreport

Now, replace bike rental fees with taxes and you just figured out why proponents of tax increases always overestimate what a tax increase brings in i.e. people change their behaviors to reflect the change.

by Burger on Aug 5, 2011 2:28 pm • linkreport

If you go to the flickr page for the photo linked in this post, it says that the locker users actually bought 2 lockers on opposite sides from each other to store his larger bike...

http://www.flickr.com/photos/mozul/160368005/

Anyone know if this is legit, and that it still might be possible for someone renting opposite from you to steal your stuff?

by Robert Oriole on Aug 5, 2011 2:29 pm • linkreport

Attention Economists! Who wants to do a bike locker price elasticity of demand calculation using the delta of rented lockers and the delta in price?

When I lived in Denver, they also had a locker system run by the transit agency, though poorly managed, as I wrote about here:
http://ayearofbikecommuting.blogspot.com/2008/02/my-new-property.html

The better system would be to use something like Bikestation's automated bike parking station. They have one in Covina, CA, and a few other locations at this point. Most appropriate for periphery stations, too space intensive for DuPont or Woodley, though I'd make that same argument for the existing bike lockers.

I was taught in policy school that all policy remedies flow from the problem definition. In this case, the problem is that a decent bike left unattended all day will be stripped of parts, vandalized or stolen. If we can agree on that, then we can come to a different remedy than exclusive bike lockers, and probably a more affordable one.

by Will on Aug 5, 2011 3:05 pm • linkreport

For all of those whining about how parking should be increased, tell me how many times parking has been increased over the last 32 years.

Sheesh

by TGEOA on Aug 5, 2011 3:06 pm • linkreport

With the non-existent advertising, it appears only a select few actually know about the lockers in the first place. I wonder what would happen if metro actually advertised these lockers in the stations.

As other people said, these aren't obviously bike lockers. I had assumed they were electrical or other utility boxes for the first 5 years I lived here. Maybe a few bright colorful signs would fill those lockers. I'm sure the WABA whining would be replaced by calls for more racks.

If metro wanted to really make them easy to use, maybe some type of pay-by-smartrip system for per-day rental.

by m on Aug 5, 2011 3:15 pm • linkreport

I rented a bike locker at the Rockville station for three years. After the price increase, I did not renew my contract when it expired.

When the rental fee was increased, I was flabbergasted by the percentage of the increase. I did not have an issue with a price increase. Let be honest. $70 was dirt cheap to rent a locker for a year and WMATA had never raised the price. But a 185.7% increase in one swoop? That really pissed me off.

Now I park my bike at the rack. It gets rained on, and I've had a light stolen off of it (the light only cost $5, so I wasn't really upset). Given the negatives, I STILL would not pay $200 a year to rent a locker. I would, however, pay more than $70. If the price was dropped ($100/year?) I would absolutely rent a locker again.

by HB on Aug 5, 2011 3:16 pm • linkreport

I was taught in Policy School that elasticity (like all other market behavior) is contingent, inter alia, on people knowing there's a market...and that referring to policy school was pedantic.

by Jeff on Aug 5, 2011 3:18 pm • linkreport

I wonder if the lack of advertising at the stations and the ambiguous nature of the lockers themselves is for security and to dissuade vandalism. Since most or a lot of people don't know what they are, they don't get much attention and don't get damaged or broken in to terribly often.

by JMC on Aug 5, 2011 3:20 pm • linkreport

It's a slow day, so here it is, the price elasticity of Demand for bike locker rentals here in DC is .47

Ed = .47

Calculated using the method expressed here, and using available data points from the metro spreadsheet:

http://www.quickmba.com/econ/micro/elas/ped.shtml

Metro should be able to use this to determine a profit maximizing price for bike lockers. Likely, this will be somewhere in between their old price and new price.

by Will on Aug 5, 2011 3:24 pm • linkreport

Jeff,

I was taught in grade school that "policy school" should not be capitalized. Your school must have sucked, the fact that people have been paying for bike lockers, and especially that fewer chose to do so when the price changed demonstrates that there is a market, albeit imperfect, for this particular good.

Yay for Friday afternoon comment fights.

by Will on Aug 5, 2011 3:31 pm • linkreport

DuPont or Woodley

Please! It's Dupont, not DuPont.

Thank you.

by Dupont Circle on Aug 5, 2011 3:34 pm • linkreport

since the price elasticity of demand is less than one, shouldn't the maximizing price be higher than it is now?

Is profit maximizing price really what WMATA wants? We should have even more empty lockers? Should WMATA charge profit maximizing fares so we can run half-empty trains?

by Michael Perkins on Aug 5, 2011 3:34 pm • linkreport

Hb is correct. Short term vs long term elasticity.

Any way to correlate this data with the data from bike parking?

by Charlie on Aug 5, 2011 3:45 pm • linkreport

@JMC - I agree completely.

$200/yr doesn't seem like a bad price to me. In fact, I would be cool with paying that (or more) if I was trying to decide between a house next to a station or one farther away that cost a lot less and didn't want to get a car.

In fact, the value is favorable even if you already have the car. I'm considering getting a locker as a fair-weather substitute for driving 1.5 miles to the station. Even with that short a drive and a reasonably fuel-efficient car, the locker would pay for itself in saved fuel costs with 50% usage. And when parking is considered, it will pay for itself with usage as little as 1 day a week.

Of course, as with "free" auto parking, bike riders are accustomed to "free" bicycle racks, with the primary cost being the theft-and-damage risk. That's undoubtedly why demand is so price elastic.

by Eric on Aug 5, 2011 3:50 pm • linkreport

Either these data are wrong, or WMATA's locker wait list management is screwed up (or perhaps both). I signed up for the waiting list for a locker at College Park two years ago, and I haven't been contacted yet. I'd be delighted if I could get a locker for $200.

by Rob on Aug 5, 2011 3:57 pm • linkreport

Michael,

I probably got off to a tangent. No, profit maximizing should not be the goal, going back to the problem definition, the goal should be providing a way for someone to leave a bike unattended all day and be confident that when they return it will still be there in the same condition as they left it. I'm not convinced the best solution for this is lockers, and believe, without evidence, that security cameras and enforcement is the solution. We can look to our friends in Europe or Asia to see they don't have individual lockers, but rather massive corrals, often with unlocked bikes everywhere.

Prevent the thefts and vandalism and you solve the problem and can just use normal bike racks. Of course with Metro transit police busy with bag searches and looking for terrorists, park police busy harassing pedi-cabs and yelling at motorists for stopping at crosswalks, and MPD busy escorting celebrities from Dulles, I'm not sure who would have the time to actually address this quality of life issue.

by Will on Aug 5, 2011 3:57 pm • linkreport

Also, Michael is right,

if the slope were representative, based on the concrete data we have available, the profit maximizing price is above $200. Assume you priced it at $205 and got only one cancelled locker, they'd increase their revenue marginally while decreasing occupancy marginally.

We're limited by only having two data points, P1/Q1 and P2/Q2 with which to calculate a simple slope for PED. We need a few more points if we want to get the real PED, which is most certainly a curve that gets increasingly steep as price escalates and increasingly gradual as price goes down. If metro wanted to really maximize profit, they could do this calc for each station and have performance pricing set accordingly.

by Will Handsfield on Aug 5, 2011 4:11 pm • linkreport

I don't think Cabi is a likely cause. 9 of the stations on that list are located near a Cabi station. Those nine have an aggregate rental rate of 52%. You need to do a before and after assessment of rental rates before you start drawing too many conclusions.

by Scott on Aug 5, 2011 5:11 pm • linkreport

For the life of me I cannot understand why they require a full year commitment for a locker. Do they require a full year committment to get a parking spot, or a train ticket at WMATA? No. So, why not daily or weekly rentals too?

by SJE on Aug 5, 2011 5:42 pm • linkreport

[Full disclosure: former DC resident for 7 years, now living in Oakland, but still occasionally read the blog.]

Just wanted to agree with SJE above. The bike locker system we have in the Bay Area charges per hour - you register for a card, buy time on it, and can use any locker in the system by swiping the card in and out. I use this on a very occasional basis - maybe a few times a month - but am very glad to have it when necessary. Seems to work fine without requiring a huge upfront commitment.

As for those wondering why bike lockers instead of bikeshare, they serve pretty much mirror image markets. Lockers are for those who ride from home to the Metro for their commute and don't want to leave their bike unguarded. Bikeshare doesn't meet that need (or only does so in the dense city center where there are bikes available near most people's houses.)

by Erica on Aug 5, 2011 6:43 pm • linkreport

It's odd to see New Carollton listed at 19%. Two years ago when I requested a locker there I was told there were none and to contact them in a couple of months (they don't keep a waiting list). Either lockers there became much less popular, or they were wrong.

Jim, Some people don't want the lockers labelled. They don't want to hang a sign that reads "Free bike inside if you can break this open."

Re: Homeless. Where is everyone getting this? No they didn't raise the price to keep out the homeless.

If the goal of WMATA was to maximize revenue this might be a good choice, but this isn't their goal. Their goal is to maximize ridership for a set subsidy. So this policy reduces both ridership (maybe) and the subsidy. If this policy drives away enough customers it's a fail even though it may increase revenue.

by David C on Aug 6, 2011 12:02 am • linkreport

It's about time bike owners started paying their fare share. They're using roads and demanding parking spaces and showers in office buildings. They should cough up some bucks for parking. Frankly, they should be paying license and registration fees as well. If you want to play, you got to pay.

by maeve on Aug 6, 2011 3:01 pm • linkreport

Setting prices is hard work! We should be more forgiving of mistakes and experiments. Cut WMATA some slack!

by WRD on Aug 7, 2011 5:13 pm • linkreport

Like some others have commented, I have tried in vain over the past several years to rent a locker at Braddock Road. Every time I was told that all the lockers are rented but they keep a waiting list. They took my information (or so they said over the phone) and said they'd call me. As expected, I was never called.

My neighbor, who has had a locker for about 10 years, told me the way he got it was calling 2x a week, every week for 2 months. He thinks they got tired of him and gave him a locker to make him go away.

Clearly WMATA's bike locker system has management issues. Once they fix them, I would gladly pay $200/year for a locker.

by Braddock Biker on Aug 8, 2011 10:06 am • linkreport

I had a similar experience to @Braddock Biker when I first got my locker. They told me they had one available in 2 weeks, then when I called back - poof, it was gone. Then when I asked how that was possible, they mailed me a key and said if it was occupied to let them know, as it likely was (!). Completely mismanaged.

When they hiked the rates, I never got notification that I needed to renew. I procrastinated contacting them as I didn't really want to pay the extra fee. Guess what happened - nothing. Free locker. No email, no phone, no letter, no posting on my locker. I've since trued up (so that I don't get repossessed), but they were clueless.

They claim it's under new management now. I hope so, as they'll never capture anywhere close to the revenue they want/need to.

While the econominerds of this blog will surely push for elastic pricing, does anyone think that an organization that can barely manage a "rented/not rented" spreadsheet can effectively institute such an elaborate scheme? C'mon now.

All that said, the one time that I had a problem with my lock, they promptly dispatched somebody to fix it (was done within about 24-48 hours).

And to the comment about sharing your locker with the person across - that would require a reciprocating saw to actually do (the lockers are separated by plywood internally), which I'm pretty sure would be considered destruction of property.

by rooty tooty on Aug 8, 2011 4:51 pm • linkreport

rooty tooty: "does anyone think that an organization that can barely manage a 'rented/not rented' spreadsheet..."

You're absulutely right -- managing this is way outside of WMATA's wheelhouse (and they're already bad at managing what's inside their wheelhouse).

They should have Alta (the CaBi vendor) run it instead -- the technology for manging daily/annual locker rental is almost the same as managing daily/annual bike rental.

by Novanglus on Aug 10, 2011 10:51 am • linkreport

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