Economic Daily Calls for End to Food Delivery Price War as Meituan and Alibaba Rally
State Media Intervention in Platform Competition
China's Economic Daily has published a commentary titled "The Food Delivery War Should End" (外卖大战该结束了), calling for an end to the destructive price competition between food delivery platforms. The statement triggered immediate stock rallies for both Meituan and Alibaba.
The Price War
China's food delivery market has been engulfed in intense price competition:
- Platforms have been offering massive subsidies to attract both consumers and merchants
- The conflict reportedly burned through 80 billion RMB in just six months
- Smaller players have been squeezed out while the remaining giants bleed cash
The Economic Daily's Argument
The state media commentary argues that:
- Unsustainable model: Price wars destroy long-term value for all participants
- Merchant harm: Restaurants and food vendors are being squeezed by platform commission pressure
- Consumer harm: Current low prices create unrealistic expectations that will reverse when subsidies end
- Market distortion: Capital-driven competition prevents healthy market development
Market Reaction
The commentary had an immediate and significant market impact:
- Meituan shares surged on expectations of reduced competitive pressure
- Alibaba (Ele.me) also rallied sharply
- Investors interpreted the state media signal as a potential turning point
Broader Context
This intervention reflects a pattern in Chinese tech regulation: the government allows competition to drive innovation and lower prices, then steps in when the effects become destructive. Similar interventions occurred in ride-hailing (Didi), online education, and fintech.
The message is clear: Beijing wants efficient, profitable platforms that serve the real economy — not a war of attrition that burns investor capital and harms small businesses.