Competition in Bike-Sharing: Effects of Discount Incentives and Comfort Level

This paper investigates the competition between two types of bike-sharing services, particularly at bus stops, subway stations, and residential areas. Two types of shared bicycle travel choice models are constructed. A shared bicycle operator attracts users by implementing discount incentives, and the comfort levels of riding the two types of shared bicycles are different. The equilibrium fares, potential user demand, and operator profits under joint profit maximization, price competition, and potential user demand competition scenarios are derived, and the competitive results under the three scenarios are compared. The results show that, in the potential user demand competition, the difference in potential demand between the two operators is largest; in the joint profit maximization scenario involving shared bicycle operators, the difference in potential user demand is smallest. In all competitive scenarios, higher operating costs and costs in lowering comfort loss for the shared bicycle operators will increase fares; the substitution level between the two types of shared bicycles has a positive impact on potential user demand, and the higher the substitution level, the better the effect of discounts in attracting users.