2025-09-09 14:53Summary of the Express Delivery Industry Conference Call Industry Overview - The express delivery industry has undergone significant changes, transitioning from a "Spring and Autumn" phase (2017-2019) characterized by high growth and light asset models to a "Warring States" phase (2020 onwards) marked by heavy asset investments and price wars [3][10]. Key Points and Arguments - Revenue Decline Factors: The decline in single ticket revenue is attributed to three main factors: cost-driven efficiencies, rational competition, and irrational price wars. The past five years have seen revenue declines primarily driven by cost factors such as scale effects and automation upgrades [1][4][20]. - Impact of New Entrants: The entry of Jitu in 2020 triggered irrational price wars, leading to a decline in industry performance and valuations, putting pressure on networks and couriers [1][8]. - Regulatory Actions: Local governments, such as in Yiwu, have implemented measures to raise minimum delivery prices to curb irrational competition, which has stabilized the network and improved valuations for lower-ranked companies [1][9]. - Market Recovery: Following the anti-involution actions in 2021, leading companies regained market share, and single ticket revenue increased, significantly restoring profitability [10][11]. - Future Price Competition: The industry is expected to enter another price competition phase in the second half of 2024, with intensified price wars anticipated post-Chinese New Year in 2025 [1][12]. Important but Overlooked Content - Regulatory Influence: The effectiveness of the anti-involution measures heavily relies on regulatory strength, which has shown to alleviate competitive pressures in the short term and promote healthy competition in the long term [2][16]. - Profitability Elasticity: Future profitability in the express delivery sector will depend on the sustainability of price increases and regulatory actions. Current net profits for major companies are low, indicating a need for effective price adjustments to enhance profitability [17][21]. - Long-term Implications: The current anti-involution measures are expected to foster a healthy competitive environment, leading to industry consolidation and the rise of leading companies, ultimately benefiting consumers and investors alike [22]. Conclusion - The express delivery industry is at a critical juncture, with regulatory measures playing a pivotal role in shaping its future. The focus on sustainable pricing and profitability recovery presents significant investment opportunities in the sector, particularly for leading companies poised for growth in a more stable competitive landscape [19][22].