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Coupang to shake up Korea’s logistics industry landscape

Gears up to start logistics business with strong networks, aggressive investment; to hurt dominant delivery player CJ Logistics

By Jan 12, 2022 (Gmt+09:00)

Coupang's delivery trucks
Coupang's delivery trucks

South Korea’s e-commerce giant Coupang Inc. is looking to tap into the country’s logistics industry, shaking up the sector, while market leader CJ Logistics is losing its dominance.

CJ Logistics has lost market share since raising delivery fares to improve profitability when the market’s growth slowed last year.

Parcel delivery volume was estimated to have increased around 10% last year, about half of 20.7% growth in 2020, according to the domestic logistics industry sources on Tuesday. The volume rose 8.8% in the first three quarters from a year earlier.

The slowdown came as the local e-commerce market is maturing after years of rapid growth and US-listed Coupang expanded its business with its own logistics networks, sources said. The more Coupang grows, the fewer parcels logistics companies deliver. Coupang’s online market share probably rose 6% points to 20% in 2021, according to Hana Financial Investment Co.


Coupang’s rapid expansion posed an immediate threat to CJ Logistics, raising concerns over growth in the country’s top logistics company. Its growth, which had outpaced the overall industry’s expansion, underperformed the market. CJ Logistics’ parcel delivery volumes rose 5.3% in the first three quarters of 2021, sharply lower than 28.1% in 2020. The company increased delivery fares by about 10%, causing some of the customers to turn to smaller rivals Lotte Global Logistics Co. and Hanjin Transportation Co., industry sources analyzed. As a result, CJ Logistics’ market share fell to 48% last year. The market share was above 50% in 2020.
A CJ Logistics' logistics center
A CJ Logistics' logistics center

Coupang aims to expand its business into delivery service for other e-commerce operators, utilizing the logistics networks it has built up with the billions of dollars of investment in its own business. The company is predicted to soon begin delivery services.

Coupang obtained approval for the service from the government through its logistics subsidiary Coupang Logistics Services.


Coupang was known to recently hire a large number of employees for the third-party delivery service.

“Rumors are swirling that Coupang, which is still expanding its logistics networks, has prepared tens of thousands of Coupang Cars for third-party logistics services,” said an industry source.

Coupang’s logistics centers across the country are located within 10 kilometers of about 70% of the country’s total households.

On the rumors, the company took a cautious stance, saying “we are very busy handling the surging parcels of our own.”

Coupang’s entry into the logistics sector is expected to take a bite into CJ Logistics, given the e-commerce giant’s aggressive moves in a new market. Coupang Eats, its food delivery service operator, already threatened the country’s dominant player Baedal Minjok, owned by Germany’s Delivery Hero SE, with active investment.

Mirae Asset Securities cited Coupang’s third-party delivery service as the main risk to CJ Logistics. Its stock prices remained sluggish even as the company’s operating profit in 2021 was forecast to increase 9% to around 355 billion won ($298.2 million).

The stock on Tuesday closed at 126,000 won, down 35% from a 52-week high of 194,500 won.

Write to Han-Shin Park at

Jongwoo Cheon edited this article.
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