JD.com brings logistics power to Korea in bid to rival Coupang
Under tariff pressure, 'China's Amazon' targets Korea in strategic shift from US
As Chinese e-commerce players contend for market share in neighboring South Korea — an apparent hedge against tightening access to the US — JD.com has entered the fray, armed with its own logistics network.
JD.com, one of China's leading e-commerce platforms alongside AliExpress and Temu, sets itself apart with a direct-purchase model in contrast to the open-market approach favored by its peers.
Last week, JD Logistics, the supply chain arm of JD.com, opened two self-operated logistics centers in Incheon and Icheon, Gyeonggi Province, marking the first time a Chinese e-commerce company has established its own warehouses on Korean soil.
According to JD.com, the centers offer third-party fulfillment and 12-hour delivery across parts of Seoul and Gyeonggi Province. The Incheon hub handles logistics for US consumer goods and Korean beauty brands targeting overseas markets, while the Icheon center specializes in pet products.
'Consumers in South Korea expect fast and precise delivery,' said an official from JD Logistics. 'By combining our automation capabilities with global operations expertise, JD Logistics is well-positioned to support local brands and enhance customer satisfaction.'
JD Logistics also connects Korean products directly with Chinese consumers via JD.com's cross-border e-commerce platform, the company explained. The company's global logistics network now spans over 100 warehouses across 19 countries.
JD.com's expansion into Korea may seem abrupt, but its footprint in the country dates back to 2018, when it set up JD Korea, a subsidiary tasked with wholesale and retail sales, e-commerce and telecommunications. In 2022, it secured a license for cross-border freight services.
Industry insiders see JD Logistics' new centers as a step toward entering Korea's e-commerce market.
Its apparent push to court Korean consumers adds to the unease among domestic firms already grappling with slowing growth and declining performance.
'JD.com has typically prioritized building its own logistics infrastructure when entering new markets, and this move appears to follow the same playbook,' one industry official said. 'A full-scale launch into the Korean market now seems only a matter of time.'
JD.com's foray into Korea is likely to set the stage for a rivalry with Coupang, the country's e-commerce powerhouse, as both companies prioritize speed and logistics through infrastructure-driven models.
'The influx of low-cost Chinese products is likely to expand, intensifying cutthroat competition with Korean e-commerce platforms like Coupang,' another industry official noted.
JD.com reported annual revenue of 1.16 trillion yuan ($160 billion) last year, more than five times Coupang's 41 trillion won ($29 billion) in sales. While Coupang is listed on the New York Stock Exchange, JD.com trades on the Nasdaq.
As macroeconomic tides shift with sluggish domestic growth in China and rising trade tensions with the US, Chinese e-commerce firms are extending their reach into overseas markets with stronger growth potential.
The US government's recent move to end tariff exemptions on Chinese imports under $800 also motivates Chinese e-commerce giants' advance into Korea, a high-stakes market where their platforms are rapidly gaining ground.
According to market research firm WiseApp, AliExpress and Temu's combined transaction volume in Korea reached an estimated 4.28 trillion won last year, up 85 percent from the year before. In 2021, the figure was just 1.1 trillion won, before crossing the 2 trillion mark in 2023.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Korea Herald
11 hours ago
- Korea Herald
BOK chief backs need for won-based stablecoin, warns of FX risks
Central bank notes price growth slowing, but pandemic-era surges still weigh on consumers Bank of Korea Gov. Rhee Chang-yong said Wednesday that he is not opposed to the issuance of a Korean won-pegged stablecoin and, in fact, sees a need for it. When asked whether the issuance of a won-based stablecoin could trigger inflation by increasing the money supply, Rhee clarified his position. 'I do see the need for a won-backed stablecoin. Let me be clear — I am not against it,' he said during a press conference held at the central bank's headquarters. He added that the impact of such a stablecoin on the monetary system would depend on the form of issuance and the type of assets backing it. However, Rhee raised concerns over potential challenges to foreign exchange controls. 'If a won-based stablecoin is issued, it could facilitate the conversion of won-denominated assets into dollar-based stablecoins, which could increase demand for foreign stablecoins and complicate forex management,' he said. The ruling Democratic Party of Korea has been pushing to allow non-banking institutions to issue a won-based stablecoin. 'We would need to consider the broader implications for bank profitability and structural changes if payment and settlement functions — traditionally handled by banks — are expanded to the non-banking sector," Rhee said. He added that the central bank would work with the Ministry of Economy and Finance and the Financial Services Commission to establish appropriate measures as soon as possible. Wednesday's press conference was also held to review the current inflation trend in Korea. In the first five months of 2025, consumer prices rose 2.1 percent — slightly higher than the 1.8 percent increase seen in the last six months of 2024, but still near the central bank's target of 2 percent. 'The pace of growth has stabilized, but prices remain elevated due to the sharp rise that occurred during the COVID-19 pandemic,' Rhee said. From 2021 to May 2025, overall consumer prices increased by 15.9 percent. Meanwhile, the cost of living index — which includes a selected subset of essential items — rose 19.1 percent during the same period, outpacing general inflation by 3.2 percentage points and highlighting rising household burdens. The Bank of Korea also commented on the potential inflationary impact of recent US tariff measures. The central bank noted that the tariffs could actually help ease inflationary pressure in Korea, given its heavy reliance on exports to both the US and China. The logic: weaker global demand could lead to lower raw material prices. Additionally, if China redirects its low-cost goods to markets like Korea due to reduced exports to the US, it could create further deflationary pressure. However, the BOK emphasized the uncertainty surrounding these projections. 'Since the implementation and scope of tariffs could vary depending on negotiation outcomes, factors such as won depreciation or partial supply chain disruptions could offset any downward pressure on prices,' the central bank said in a statement.
Korea Herald
12 hours ago
- Korea Herald
Seoul shares up for 3rd day on top-cap, IT gains
South Korean stocks closed higher for the third consecutive session Wednesday, led by big gains in market heavyweight Samsung Electronics and IT shares. The local currency was trading lower against the US dollar. The benchmark Korea Composite Stock Price Index added 21.89 points, or 0.74 percent, to end at 2,972.19. Trade volume was moderate at 568.6 million shares worth 14.4 trillion won ($10.5 billion), with losers outnumbering winners 457 to 425. Foreigners net purchased 272 billion won worth of local shares, and institutions bought 130.6 billion won, while retail investors unloaded 432 billion won in apparent profit taking. Investors' eyes are on whether the KOSPI will hit the 3,000 mark for the first time in over three years this week despite the growing tensions in the Middle East. Overnight, Wall Street lost ground on news reports that US President Donald Trump has called for Iran's "unconditional surrender" and warned people in Tehran to evacuate immediately, suggesting a possible escalation of tensions in the region. Iran has been engaging in a military conflict with Israel after the latter conducted preemptive airstrikes on Iranian nuclear facilities earlier this week. Experts said foreign investors moved to buy IT shares on the Korean government's plan to make a massive investment in artificial intelligence (AI), while global investment bank JP Morgan recommended overweight of top search engine Naver in stock portfolio. On Sunday, President Lee Jae Myung appointed Ha Jung-woo, head of the Future AI Center at Naver, as the presidential secretary for AI policy, a newly minted position. Naver shot up 17.92 percent to 243,500 won, while Kakao, the operator of the country's dominant mobile messenger, jumped 6.56 percent to 55,200 won. NHN, a major IT and game company, also rallied 10.46 percent to 32,200 won. Tech behemoth Samsung Electronics climbed 2.93 percent to 59,800 won, and leading nuclear power plant manufacturer Doosan Enerbility advanced 2.69 percent to 61,000 won. Major oil refinery SK Innovation soared 10.98 percent to 101,100 won as the Israel-Iran conflict drove up international oil prices. On the other hand, chipmaking giant SK hynix lost 1 percent to 246,500 won, while defense industry leader Hanwha Aerospace dropped 2.83 percent to 927,000 won. The local currency was quoted at 1,369.4 won against the greenback at 3:30 p.m., down 6.7 won from the previous session. (Yonhap)
Korea Herald
13 hours ago
- Korea Herald
Woori Financial takes cue from aging Japan
A think tank under South Korea's financial service provider Woori Financial Group published a book Wednesday exploring how Japan adapted to aging demographics, redefined its financial and corporate landscape and what lessons Korea can draw from the transformation. Titled The Great Shift in Japan's Economy (tentative translation), the book is the result of a yearlong research project conducted by the Woori Finance Research Institute, which included in-person interviews and case studies, looking into the country's corporate culture reforms, digital innovations and changed role of financial institutions. "While initiatives such as the shareholder return policy were effective, the success of the Japanese financial institutions' value-up strategy was mainly driven by their global business," Woori Finance Research Institute CEO Park Jung-hoon said at a press conference held at the bank's headquarters in central Seoul, Wednesday. In the book, the think tank delved into the global expansion of Japan's three major financial firms, Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial Group, and Mizuho Financial Group. Struggling with the Japanese central bank's prolonged monetary easing, the three firms altered in their business targets, setting their sights on global operations. As a result, their overseas operating profits surged fivefold between 2006 and 2023. Earnings from overseas operations took up roughly 50 percent of the total operating profits for the firms in 2023,more than three times what they did in 2006 — 15 percent. "It took over 10 years for the Japanese finance firms to bear fruit in their global operations. Korean financial companies have to continuously strengthen their global competitiveness in a long-term perspective,' Park said. Taking a hint from Japan and its aging society, Woori Financial plans to bolster its senior-targeted operations, too. Having gained the green light from the authorities to acquire Tongyang Life and ABL Life, the finance group is to officially incorporate the insurers into its portfolio in July. "With the acquisition of the insurers, Woori Financial is looking into how the group can offer senior-targeted financial services. We are studying Japanese cases through business trips, visiting nursing homes, and meeting experts. Woori Finance Research Institute will continue to study how the group can encompass seniors in its business, as it is a meaningful agenda on a national level,' Park said.
