Core Viewpoint - The intense competition in the food delivery sector, described as the largest subsidy war in China's internet industry, has led to a significant increase in daily order volume, surpassing 200 million within just ten days [2] Group 1: Market Competition - Major players like Alibaba, Meituan, and JD have entered the food delivery market, resulting in a rapid increase in order volume [2] - Meituan's CEO Wang Pu Zhong emphasized the unsustainable nature of the current subsidy-driven competition, calling for a return to rationality in the industry [3][5] - Wang highlighted that the majority of current order volumes are inflated and do not reflect genuine market demand, indicating a bubble in the industry [3][5] Group 2: Business Strategy - Meituan aims to respond to competition with more efficient and lower-cost strategies, such as optimizing order structures through in-store pickup [3] - The company maintains a high proportion of valuable orders, with over 70% of orders priced above 30 yuan [4] - Wang noted that the current subsidy strategies employed by competitors are not sustainable and could lead to higher losses due to inadequate system capabilities [3] Group 3: Industry Impact - The ongoing subsidy war has led to a significant increase in order volumes in certain cities, but it has also disrupted traditional dining practices and pricing structures [5] - Wang expressed concerns that the long-term effects of the subsidy war could damage established price perceptions in the restaurant industry [5] - The food delivery business model is characterized by thin margins, making it vulnerable to aggressive competition [7] Group 4: Financial Implications - Estimates suggest that Meituan, JD, and Alibaba may collectively spend up to 250 billion yuan monthly on subsidies [6] - Wang believes that a scenario where all three companies exhaust their cash reserves is unlikely, as each has its own strategic priorities beyond the subsidy war [6] - The food delivery sector's profit margins are low compared to other internet sectors, with the industry generating only 30 billion yuan in profit last year [7]