JD.com Is Largest E-Commerce Beneficiary in China's National Trade-In Program

JD.com offers authentic products from its online first-party business with speedy and high-quality delivery. It adopts an asset-heavy 1P model with self-owned inventory and largely self-built logistics, complemented by an asset-light third-party model. By comparison, its competitor Alibaba relies mostly on a 3P model. Underperforming Pinduoduo and Douyin, JD’s GMV/China online retail sales of goods has decreased from 30.7% in 2021 to 28.4% in 2024. To reinvigorate growth, JD wants to promote itself as an everyday low-price platform and has launched a CNY 10 billion subsidy program to attract price-sensitive customers. It stopped selling nonstrategic low-margin products from the 1P business and is allowing 3P merchants and business partners to provide these products instead. JD.com is also streamlining its organization to increase its ability to respond to quickly to changing market dynamics. We expect JD.com to see decent sales growth in 2025 as the national trade-in subsidy program started in the fourth quarter of 2024.