Now Citi Bank is a Bicycle shop… can they get any lower than that…?
By Nick Summers October 31, 2013
Vikram Pandit stood fidgeting in a park near New York’s City Hall, looking owlish in a suit and rimless spectacles. It was May 7, 2012, and he’d had better springs. Citigroup (C), where he was chief executive officer, had recently flunked a government “stress test” meant to identify which big lenders were still shaky in the wake of the financial crisis. The Federal Reserve had vetoed an $8 billion stock buyback, and irritated shareholders had just voted against Pandit’s pay package of $15 million.
Today the news was better. Pandit took his place next to a podium as New York Mayor Michael Bloomberg announced to a gaggle of reporters that, after three years of study, the city was finally starting a bike-sharing program—one that would cost taxpayers nothing, thanks to a $41 million deal with Pandit’s Citigroup. The cobalt blue two-wheelers, the mayor said, would be called Citi Bikes.
As Bloomberg detailed the program, which he said would grow to include 10,000 bicycles at 600 stations across the city, he kept tripping over its name. “The person who I have the pleasure of introducing next hopes that everyone does exactly the same thing I did four or five times: confuse ‘Citi Bike’ with ‘Citibank,’ ” the mayor said. “That is very good for Citibank’s business, and presumably the reason why they are the sponsor of this—and I certainly hope it works.” (The mayor is the founder and majority owner of Bloomberg LP, the parent of this magazine.)
Pandit smiled and took the microphone. “Citi Bike is kind of like the Zipcar (CAR) for bikes,” he said, reeling off its many virtues. “It’s better for the environment. It’s also good exercise. People will be able to borrow a Citi Bike wherever they want and return it at their destination. This should lead to fewer cars on the road. It should lead to less crowding on subways and buses and better access to neighborhoods far from public transit.”
And best of all: “As the mayor said—all of this without using any taxpayer money!”
Here the irony was as thick as a Citi Bike’s puncture-resistant tires. Citigroup took an estimated $476 billion in public cash and guarantees during the financial crisis, more than any other bank. Now Pandit was sending an amount equivalent to 0.008 percent of its rescue bill back to the people, in the form of shiny new three-speeds. Could tough, crisis-scarred New Yorkers really be bought off that easily?
Eighteen months later, Citi Bike has remade the city. Since the program’s official launch on May 27, 2013, New Yorkers (and tourists) have taken more than 4.7 million trips and pedaled 9.4 million miles, obliterating projections, as the system has been embraced by commuters and the celebrity class alike. Bruce Willis rode a Citi Bike off the street and onto the stage of the Late Show With David Letterman; 10-year-old Quvenzhané Wallis pedaled one around on the set of the remake of Annie. Leonardo DiCaprio, whose new film, The Wolf of Wall Street, shows brokerage-house excess at its worst, has been repeatedly spotted on one of the rolling Citigroup advertisements. More than 92,000 people have purchased $95 annual memberships; tens of thousands more have bought daily and weekly passes.
Early critics of the program, who faulted the placement of docking stations and called the bikes eyesores, have largely been shouted down. When a Wall Street Journal columnist said the city had been “absolutely begrimed by these blazing blue Citibank bikes” and asserted that “the bike lobby is an all-powerful enterprise,” she was ridiculed on both The Daily Show With Jon Stewart and The Colbert Report—programs that are normally sulfuric on anything even tangentially related to the big banks and that have also been quick to mock other Bloomberg programs. Scores of novice cyclists haven’t been crushed beneath speeding cabs, bloodying Citi logos, as detractors predicted.
In October the New York Times ran a delightful story about couples incorporating Citi Bikes into their wedding ceremonies. Aaron Naparstek, a prominent biking activist, tweeted that Dani Simons, the Citi Bike marketing director, had a job that “just continues to do itself: I wonder what she does all day?”