In mid-October, JD.com announced it will launch a “national good car” during the “Double Eleven” period. JD.com partnered with GAC and CATL for this project. Some media misinterpreted this as JD.com making cars. JD.com clarified it is not manufacturing cars. Instead, it is collaborating. JD.com will handle customer insights and exclusive sales.
“Custom” e-commerce selling cars? It looks similar to the past. Selling cars online has become common. After years of effort, the impact remains small. This does not relate to product value. E-commerce can sell anything, even commercial real estate worth billions. The key lies in the fact that cars are less standardized than home appliances or IT products. They require more in-person experiences for products and services. Some discussions analyze the pricing, battery swap system, and structural features of this “national good car.” We will learn product details at the November 9 launch. However, the general direction is clear: low SKU, entry-level electric vehicles targeting the large “family” A-segment market. JD.com will handle sales and after-sales services entirely. The listing status is unclear, but since JD.com lacks car manufacturing qualifications, it will likely apply for product certification under the “Aion” brand. JD.com has already deeply engaged in car sales and after-market services. It offers online car products, parts, and maintenance services. It operates nearly 3,000 physical stores and over 40,000 partner outlets. What significance or uniqueness does this approach hold?
Can JD leverage its asset advantages in the automotive value chain? This relates to JD’s strategic direction. The rise of Pinduoduo, Douyin, and other e-commerce platforms has impacted Taobao the most, followed by JD. JD is not just an e-commerce platform. It has significant supply chain and logistics resources. In simple terms, JD holds the most assets in e-commerce and has the most touchpoints among distributors. Compared to the mediocre financial services of major manufacturers, JD Finance outperforms them. This gives JD a unique advantage in the car sales and aftermarket sectors. However, this does not explain why Liu Qiangdong has aggressively entered food delivery, travel, discount supermarkets, and coffee markets since his return. He has used generous subsidies to challenge strong competitors. The reason may lie in JD’s slowing core retail business. Although net profits have slightly improved, the e-commerce sector has entered a mature market. Under operational pressure, JD must seek a second growth curve. Fortunately, JD still has strong cash flow for its retail business, so it can afford aggressive strategies, at least in the initial stages. The partnership for car sales differs from the previous “supermarket” model. It focuses on customized car sales, targeting specific brands and models. GAC or Aion can act as manufacturers without engaging in marketing or aftermarket services. Additionally, CATL should not be viewed merely as a battery supplier. It should be seen as a quality endorsement for “national good cars,” a key supplier, and a provider for new scenarios. JD will manage the rest of the automotive value chain. JD aims to integrate car sales and services into its standardized e-commerce “new process.” This “new process” is more complex than traditional e-commerce. JD has its own warehousing and logistics. It will build a logistics business around vehicle fulfillment. In China, no company has ever combined warehousing and logistics for vehicles. JD seeks to monetize its logistics assets. This strategy highlights JD’s advantages over competitors like Cainiao and Meituan. A single company managing the entire logistics chain enables efficient, low-loss delivery. Given that cars are large items, JD will soon allow customers to track their orders. Customers can follow the logistics process and view video updates on transportation and storage. JD can outperform car manufacturers in financial services. By combining auto finance with insurance, trade-ins, battery-as-a-service, vehicle maintenance, and modifications, JD can create a more robust financial model than the current “installment buying” approach. This could significantly increase its financial business. From an investment perspective, JD’s involvement in the automotive value chain represents a heavier asset load than before, but it remains light compared to manufacturing. JD believes the automotive value chain merits deep engagement. With smart design, JD’s asset advantages can outperform its retail business.
“Enhanced Scene” Retail Some mention that JD has 50 million Plus customers. This presents a good opportunity for monetizing memberships. However, applying the user growth model from QQ to WeChat is difficult. History shows we should not overestimate e-commerce user stickiness. At least, it cannot compare to the activity levels of social media users. The battery swapping model itself provides strong scene-based services. NIO’s battery swapping is hard to profit from commercially, yet it remains a key brand identifier. It forms NIO’s competitive advantage. CATL has long sought to enter the battery swapping market and has made many investments. Now, with JD leading, CATL faces less pressure in establishing battery swapping stations. If JD combines scene-based services, like using the JD app to find charging stations or battery swapping stations, it can easily build user communities. Other businesses can connect, not limited to car-related services. Any service requiring offline experiences can join the ecosystem. JD could even venture into social media, which is why Alibaba struggled in that area. In summary, transforming low-frequency car purchases and repairs into high-frequency services like charging, battery swapping, and car washing will greatly increase JD membership stickiness. The membership count will become more valuable. JD’s newly launched Robotaxi business aims to turn transportation into a new e-commerce touchpoint. It integrates AI and IoT to deliver information to users. Watching an ad could potentially earn mileage. JD.com seeks a solution for retail through “enhanced scenario” retail. The “national good car” and Robotaxi serve as tools. They can operate at a loss but still create buzz. Concerns about profitability arise. Once profits come, worries about the three giants’ revenue-sharing model may lead to discord. Currently, JD.com leads the project while GAC and CATL collaborate. The risk in profit distribution is low. Some claim solid-state batteries will end battery swapping. CATL holds more authority on this matter. Their investments suggest battery swapping still has potential. JD.com just needs to trust CATL’s judgment. However, the “national good car” poses challenges. JD.com does not manufacture cars, but its ties to manufacturing and brands run deep. Quality issues could lead to significant accountability and high explanation costs. JD.com’s channels include both self-operated and franchised partnerships. If after-sales service doesn’t match the vehicle brand’s standards, it won’t be a positive asset. Moreover, JD.com lacks significant technical accumulation in smart driving and smart cockpit areas. This “dual intelligence” gap affects product competitiveness and service scenarios. Business is still developing, and JD.com focuses on launching this vehicle to create a “hit” atmosphere. They have little time for extensive investments to address these gaps.
JD.com rushes to enter this business. It mimics automakers by planning a series of marketing activities, including preheating, internal testing, test drives, and launch events. During the delivery phase, JD.com adopts a customization model. The success of the launch event does not guarantee overall success. The first batch of user experiences is crucial for JD.com’s future on this path. If this initiative succeeds and develops into a profitable business model, it may not bode well for most automakers. If automakers shift upstream in the value chain and distance themselves from end customers, the consequences will be clear. They would face challenges far more serious than the “soul issue” of past years.