Ride-hailing provider Didi enters food-delivery sector

"There's no such thing as a free lunch." -- except for those in Wuxi recently.

Chinese ride-hailing giant DiDi Chuxing launched its food delivery service Didi Waimai in the East China city on April 1, causing fierce competition among food delivery platforms.

Using a coupon for a 20-yuan discount given to new users, Wuxi resident Wang Lingling ordered a takeout meal of fried chicken and only paid the minimum cost of 0.01 yuan (one yuan equals about $0.16).

"The meal was priced at 15 yuan, and the delivery cost was three, which was all covered by the coupon," she said.

Didi's expansion in the food delivery market came after the food delivery company Meituan's move to launch a car-hailing service last month in Shanghai.

Facing competition from Didi, Meituan and other food-delivery service providers such as Ele.me have also been providing discounts.

"Meituan has announced free delivery within the city and Ele.me has offered discounts coupons ranging from 10 to 15 yuan," Wang said.

The competition has been intensified.

A user named "Jennifer" wrote on social messaging service WeChat that the service cannot keep up with the soaring demand caused by the discounts. "I ordered takeout and waited for about two hours."

Some restaurants said they were forced to leave one food delivery platform if they registered on another. Some said they had to cancel orders because they had too many to handle.

The local industrial and commercial department Wednesday held a meeting with Didi, Meituan, and Ele.me, calling for a halt to behavior suspected to be unfair competition and monopoly.

The companies said they would stop inappropriate acts and cooperate with the government to restore market order.

China has been witnessing a boom in the online food delivery industry.

Statistics show the online food delivery market reached 204.6 billion yuan last year, up 23 percent from 2016. The number of registered users is nearly 300 million.