Alibaba to invest US$16 billion in logistics

HANGZHOU: September 26, 2017. The Alibaba Group is spending US$807 million to raise its stake in affiliate Cainiao Smart Logistics Network from 47 percent to 51 percent. The transaction is expected to be completed next month.

Alibaba said it would also spend US$15.2 billion over the next five years to enable its global logistics network fulfill orders in China within 24 hours and the rest of the world within 72 hours.

alibaba technology company The investment will be used to increase R&D in logistics data technology, as well as develop smart warehousing, smart delivery and a global logistics infrastructure.

"Our goal with this investment is to provide comprehensive, first-class experience for consumers globally," said Daniel Zhang, Alibaba Group CEO. "Our commitment to Cainiao and additional investment in logistics demonstrate Alibaba's commitment to building the most-efficient logistic network in China and around the world."

Zhang said that by enhancing its logistics capabilities, Alibaba is enabling the creation of a seamless online and offline retail experience for shoppers. "We will also continue to deepen our collaboration with various logistics partners to achieve this goal," he added, without naming who they might be.

Cainiao Network operates a logistics data platform that leverages the capacity and capabilities of logistics partners to fulfill transactions between merchants and consumers by using data insights and technology to improve efficiency across the logistics value chain.

Earlier this year Malaysia prime minister Datuk Seri Najib Tun Razak announced the introduction of a Digital Free Trade Zone with support from Alibaba.

The eCommerce enabler is partnering with the state-run Malaysia Digital Economy Corporation to host what Alibaba executive chairman Jack Ma describes as an Electronic World Trade Platform.

Alibaba and Malaysia expect to extend their partnership to include logistics, cloud computing and online finance with Cainiao working with Malaysia Airport Holdings to set up an e-commerce and logistics hub at Kuala Lumpur International Airport.