Alibaba Group increase their logistics
Alibaba Group, the parent firm of the popular Chinese e-commerce site AliExpress, which is well-known for its affordable products, intends to invest over $1 billion in Korea over the course of the next three years. Within the year, a sizable distribution center will be constructed.
Industry insiders said on Thursday that Alibaba has filed its commercial expansion plan to the Korean authorities, possibly for regulatory permission, which includes a $1.1 billion investment.
Distribution Center to come up
By the end of this year, a new $200 million distribution center situated on a 180,000 square meter plot is part of the investment plan. If the idea is implemented, the facility—which is the size of 25 soccer fields—will become the biggest of its sort in Korea.
An official from Alibaba acknowledged that related reviews for the new distribution center are in progress, but he would not go into greater detail about the specifics, such as the site and financial plan.
Officials statements
The official declared, “Alibaba is committed to consistently investing in the Korean market. We are still in discussions with local vendors to make this expansion possible.”
With the improved logistics network, AliExpress, according to sources, could reduce delivery times for Korean clients and increase its market share in the rapidly expanding e-commerce sector of the country.
Prior to Alibaba’s strong pursuit of expansion in overseas markets, AliExpress had offered to invest 100 billion South Korean won ($76.2 million) in South Korea this year to enhance logistics.
In 2021, AliExpress introduced three-to five-day shipping from Taobao, Alibaba’s Chinese e-commerce platform, to South Korea, with a focus on the fashion sector. In order to reduce product prices, the business unit in South Korea distributed 10 billion won in 2022.
Since 2018, the number of active monthly users on AliExpress in South Korea has almost doubled to 7 million.
According to a previous report, Ant Group, an Alibaba fintech unit, had pledged to support four Asian e-wallets that were planning to grow into South Korea with its cross-border payment service, Alipay+.
Through the Tidal Trust II CoreValues Alpha Greater China Growth ETF (NYSE:CGRO) and the Invesco Golden Dragon China ETF (NASDAQ:PGJ), investors can have exposure to Alibaba.
Price Action: On Wednesday, BABA shares are down 1.44% at $75.29.
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