In a speech at the 2017 Gateway Conference in Toronto, Alibaba’s Chairman made some bold long-term forecasts for his company.
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He stated that:
- Within 10 years, Alibaba would deliver worldwide in 72 hours or less
- Within 10 years, Alibaba would deliver 10 billion packages a day
- Within 20 years, 60% of the world will shop online
In a related announcement, Alibaba stated that it would spend US$807 million to increase its stake to 51% in Cainiao Smart Logistics Network Limited (“Cainiao”), a delivery and logistics business. It will also invest another US$15.2 billion over the next five years to build out its global logistics network with the aim of fulfilling orders in China within 24 hours and within 72 hours globally.
The investment would focus on areas such as research in logistics data technology, smart warehousing, smart delivery and global logistics infrastructure. By taking control of Cainiao, Alibaba is committing to investing and owning its own logistics infrastructure (akin to Amazon) despite its capital intensity.
It is yet another example of Alibaba taking a long-term view of its business and its willingness to invest heavily in that long-term view.