On June 5, the Chongqing Coffee Industry Association issued a joint statement with several local independent coffee brands, urging JD.com’s food delivery to halt its aggressive Billion-Yuan Subsidy campaign. The group criticized the platform’s steep discounts on freshly brewed coffee, claiming it has triggered a rapid market-wide price collapse and harmed the long-term health of the local coffee sector. The statement highlighted that large chains like Luckin and Cotti benefit disproportionately from subsidies, pushing their delivery prices below cost, some as low as RMB 1.68 ($0.23) per cup, while squeezing out smaller local players. In May, independent cafés in Chongqing – one of China’s biggest cities – reportedly saw a 12% drop in online sales and a 13% fall in average order price. The association warned that continued price wars could accelerate store closures and job losses. It called on JD.com to disclose its subsidy mechanisms and redirect funds toward fostering a sustainable delivery ecosystem. The open letter has since been taken down. [36Kr, in Chinese]
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