China's Crackdown on Food Delivery Giants: Balancing Competition & Economy

China is set to investigate aggressive competition among tech-operated food delivery platforms like Meituan and Alibaba. This initiative aims to address price wars that have hurt profits and contributed to economic deflation, ensuring a more stable market with fair pricing.

China has launched an investigation targeting cutthroat competition among food delivery platforms operated by tech giants such as Meituan and Alibaba. The State Council aims to curb price wars that have slashed profits and exacerbated deflationary pressures on the economy.

According to a statement from the State Administration for Market Regulation, this move is designed to ensure fair competition and foster a market environment characterized by high quality and reasonable pricing. In 2025, consumer prices in China stalled at previous levels, missing the government's growth target amidst ongoing efforts to stabilize prices.

The excessive subsidies and price wars within the food delivery sector have adversely impacted the real economy, intensifying competitive strains referred to as 'involution,' or 'neijuan' in Chinese. This fierce competition is notably evident in the instant retail market, where tech giants have invested heavily, banking on delivery services as a keystone for future e-commerce growth.

(With inputs from agencies.)