Alibaba Rolls Out Half-Day Delivery Service in Major Chinese Cities
Alibaba Group's logistics arm Cainiao Network has launched express half-day delivery in 8 key cities across China, including Shanghai and Shenzhen, as part of efforts to stimulate domestic consumption amid economic gloom.
The new Cainiao Express service, unveiled in June by incoming Alibaba chairman Joe Tsai, is now available in Shanghai, Hangzhou, Shenzhen, Guangzhou, Dongguan, Foshan, Huizhou and Chengdu.
It allows customers to receive orders placed before noon by 9pm the same day, while orders made before midnight are delivered before noon the next day.
Cainiao said the half-day delivery service will expand to 7 more cities soon. Alibaba owns the South China Morning Post. In June, Cainiao pledged half-day, same-day and next-day delivery across 300 Chinese cities at its Global Smart Logistics Summit.
The company will compensate consumers for any delivery delays or shipment damage under the new express service. This highlights the fierce competition in China's massive package delivery sector dominated by SF Holding, ZTO Express and JD Logistics.
Over 60 billion parcels were delivered in mainland China in the first half of 2022, up 17% year-on-year. During China's 618 shopping festival in May-June, Cainiao handled over 400 million packages daily despite weak consumer spending.
The launch follows Cainiao's new next-day delivery between mainland China and Hong Kong last month. Orders from Cainiao warehouses in mainland are delivered to Hong Kong within 48 hours, with compensation up to 60 yuan for late deliveries.
Cainiao, one of Alibaba's fastest growing businesses, plans an IPO in the next 12-18 months. In May, Alibaba announced an overhaul of its $257 billion tech empire and will report quarterly earnings on August 10.
Cainiao's revenue grew 18% year-on-year in Q1 2022 to 13.6 billion yuan, driven by higher international fulfilment services revenue and logistics demand. This accounted for 7% of Alibaba's total revenue.
Cainiao launches half-day delivery service in 8 major Chinese cities
Part of efforts to boost domestic consumption amid economic downturn
Compensates consumers for delayed/damaged deliveries