JD.com's Food Delivery Gambit: A Threat to Monopolies or a Risky Gamble?

China’s food delivery sector is bracing for a shakeup as JD.com (NASDAQ: JD) launches its bold assault on market leaders Meituan (0988.HK) and Alibaba’s Ele.me. In February 2025, JD Takeaway entered the fray with a zero-commission model and groundbreaking labor benefits—a strategy that has already triggered regulatory scrutiny, competitor backlash, and a race to reshape industry norms. For investors, the question is whether this move will cement JD as a new market leader or backfire in a sector already dominated by entrenched giants.

The Zero-Commission Blitz

JD’s entry into food delivery is a direct challenge to the industry’s revenue model. By waiving platform commissions for merchants signing up before May 1, 2025, JD Takeaway aims to undercut Meituan and Ele, which together command 90% of the market. This aggressive pricing strategy is no accident: it leverages JD’s deep financial pockets to disrupt a low-margin sector where scale and network effects have long protected incumbents.

The real game-changer, however, is JD’s focus on couriers. Unlike competitors that classify riders as independent contractors, JD offers full-time couriers social security, housing funds, and insurance coverage—a first in the industry. This not only attracts workers but also forces rivals to raise labor standards. By March 2025, Meituan and Ele had already announced enhanced benefits for couriers, a clear sign of JD’s disruptive influence.

Regulatory Tailwinds and Headwinds

JD’s timing aligns with growing antitrust pressure on Meituan. In February 2025, China’s State Administration for Market Regulation (SAMR) extended Meituan’s rectification period indefinitely, citing ongoing allegations of anti-competitive practices like blocking restaurants from joining rival platforms. This regulatory push has created space for JD to poach merchants and couriers.

Meanwhile, the U.S. Department of Justice’s Anticompetitive Regulations Task Force (launched March 2025) signals a global trend toward curbing monopolistic practices, even if JD’s moves are primarily domestic. The alignment of regulatory priorities—both in China and abroad—suggests a favorable environment for new entrants seeking to break up entrenched duopolies.

The Couriers’ Crucible

JD’s labor strategy is both a moral and a tactical play. By guaranteeing full-time couriers direct labor contracts, it tackles a long-standing industry flaw: precarious gig work conditions. This not only improves worker retention but also positions JD as a socially responsible alternative. The company’s pledge to double its full-time courier force to 100,000 within three months underscores its ambition to build a loyal, institutionalized delivery network—a stark contrast to competitors’ reliance on freelancers.

Competitors’ responses highlight JD’s impact. Meituan denied allegations of banning riders who work for JD Takeaway but admitted punishing a driver for falsely claiming such a ban. This rebuttal suggests JD’s claims have at least stoked fear among rivals, even if their truth remains contested.

Risks and Rewards for Investors

The stakes are high. If JD succeeds, it could carve out a sustainable niche in food delivery, leveraging its logistics expertise and financial flexibility. Its zero-commission model, however, risks thin margins unless it can rapidly achieve scale. Meanwhile, Meituan and Ele’s swift benefit upgrades illustrate the costs of competition—potentially squeezing their own profit margins.

Conclusion: A New Era for Competition

JD’s gamble is paying off strategically, even if financial returns remain uncertain. By targeting labor standards and pricing power, it has forced rivals to reform while gaining regulatory favor. Key data points reinforce this view:
- SAMR’s indefinite scrutiny of Meituan removes a key barrier to entry.
- Meituan’s 60% market share dominance is now under direct pressure, with JD’s recruitment blitz and zero-commission model eating into its core.
- Couriers’ shifting loyalties—drawn by JD’s benefits—could destabilize the gig workforce that sustains competitors.

For investors, the calculus hinges on whether JD can convert these advantages into long-term profitability. The risks are clear: scaling delivery networks is capital-intensive, and Meituan’s rectification period could end without meaningful structural changes. Yet the broader trend—toward fairer labor practices and antitrust enforcement—is a tailwind for JD.

In a sector where 90% of revenue flows to two players, JD’s entry marks more than just a corporate battle—it’s a test of whether China’s digital economy can evolve beyond its monopolistic roots. For now, the verdict is still out, but the stakes for investors couldn’t be higher.