A two-stage robust approach to integrated station location and rebalancing vehicle service design in bike-sharing systems

A bike-sharing system is a shared mobility mechanism that provides an alternative transportation mode for short trips with almost no added travel speed loss. However, this model’s low usage ratio and high depreciation rate pose a risk to the sustainable development of the bike-sharing industry. Our study proposes a new integrated station location and rebalancing vehicle service design model. This model aims to maximize daily revenue under a given total investment for station locations and bike acquisition. To address demand ambiguity due to possible bias and loss of data, we present a two-stage robust optimization model with a demand-related uncertainty set. The first stage of our model determines the station locations, initial bike inventory, and service areas of rebalancing vehicles. In contrast to the literature, which either simplifies the rebalancing process as an inventory transshipment problem or formulates it as a complex dynamic bike rebalancing problem, we assign each rebalancing vehicle to a service area composed of several specified stations. An approximate maximum travel distance for each rebalancing vehicle is also designed and constrained to ensure that the rebalancing operation can be performed within each period. In the second stage, our model optimizes the daily fleet operation and maximizes the total revenue minus the rebalancing cost. To solve our model, we design a customized row generation approach. Our numerical studies demonstrate that our algorithm can efficiently obtain exact solutions in small instances. For a real-size problem, the nearly optimal solutions of our model also reveal a high-quality worst-case performance with a small loss in mean performance, particularly when the value of the budget ratio (that is, the average number of bikes per station) is at a medium level. Moreover, the distribution of service areas depends on the bike supply and demand level at each station. The optimal fleet rebalancing operation does not have to be confined to one geographical area. Furthermore, our robust model can achieve larger mean and worst-case revenues and a higher revenue stability than a stochastic model with a small data set.