Core Insights - The ultra-premium liquor market in China is characterized by a "one super, two strong, and multiple poles" oligopoly structure, with market concentration reaching historical highs by the end of 2025 [2] - Moutai holds over 60% market share, further increasing from 58% in 2021 to 63% by 2025, establishing itself as the pricing anchor and value benchmark in the ultra-premium segment [2] - Wuliangye and Luzhou Laojiao dominate the core price range of 800-1200 RMB, collectively accounting for about 35% of the ultra-premium market [2][3] Market Dynamics - The CR3 (Moutai, Wuliangye, Luzhou Laojiao) accounts for over 94% of the ultra-premium market, indicating a highly consolidated industry landscape [3] - The 2026 Spring Festival period is expected to show a K-shaped differentiation in the liquor industry, with overall sales down by approximately 10-15% [3] - Wuliangye adopts a strategy of maintaining factory prices while providing channel subsidies to lower terminal prices, while Luzhou Laojiao focuses on controlling supply to maintain brand value [3][5] Pricing Strategies - Wuliangye's strategy involves indirect price reductions through channel subsidies, keeping the official factory price stable at 969 RMB per bottle [5][6] - Luzhou Laojiao maintains its factory price at 980 RMB, emphasizing strict control over distribution and pricing to uphold brand integrity [7][8] Sales Performance - Wuliangye's sales during the Spring Festival period show a year-on-year increase of 5-12%, successfully capturing market share despite overall industry contraction [9][10] - Luzhou Laojiao experiences a decline in sales volume by 15-20% during the same period, missing opportunities in the market [14][15] Inventory and Channel Management - Post-Spring Festival, Wuliangye's inventory levels are reported to be at a healthy range of 45-60 days, significantly lower than the industry average [16] - Luzhou Laojiao faces challenges with inventory management, particularly in weaker regions where stock levels exceed three months [19] Brand Positioning - Wuliangye's pricing strategy has led to a reduction in brand premium, with terminal prices dropping to the 800 RMB range, potentially affecting its high-end positioning [22] - Luzhou Laojiao's strategy of maintaining higher prices reinforces its high-end brand image, although it risks losing market share in price-sensitive segments [25][26] Future Outlook - The competition between Wuliangye and Luzhou Laojiao will depend on their ability to sustain their respective strategies post-Spring Festival, with Wuliangye focusing on volume and channel health, while Luzhou Laojiao aims to maintain brand value [26]