Chinese online food delivery giant Meituan has replaced the head of its foundational research and development team, as the company seeks to innovate its business amid slower growth and an anaemic economy.
Han Jian, former head of the platform technology team, will succeed Zhang Jimao, according to an announcement via internal email. Zhang will remain as chairman of the technology committee, a position he has held for three years.
The changes, effective immediately, are aimed partly at improving the operational efficiency of Meituan’s retail businesses through the use of technologies, including autonomous vehicles, drones, artificial intelligence and large language models, according to an employee, who confirmed the authenticity of the email and asked not be named discussing internal matters.
Under the guidance of the technology committee, Meituan will set up a “technology governance preparatory group” to sort out the future scope, goals, operations and sources of support for its technology governance structure.
01:15
Drone food deliveries take off in China’s tech city, Shenzhen
Drone food deliveries take off in China’s tech city, Shenzhen
Meituan did not immediately respond to a request for comment about the reshuffle, which was first reported by Chinese tech media outlet 36Kr.
Meituan, which has seen its stock price plunge 80 per cent from its peak in early 2021, runs one of the largest gig economy platforms in China, consisting of nearly 7 million delivery drivers. The company has been under constant public pressure to improve the welfare coverage and labour conditions of its workers.
In 2021, Meituan was ordered by seven government agencies to pay its delivery riders more than the country’s minimum wage and free them from unreasonable demands made by algorithms dictating the number and timing of deliveries.
In response, Meituan published its delivery algorithms and promised to better protect its workers.
“We anticipate a revenue slowdown because management expects consumers to be more cautious and value-oriented,” Morningstar senior equity analyst Kai Wang said in a research note. He cut the price target by 30 per cent to HK$102 and downgraded the stock to hold from buy.
JPMorgan nearly halved its price target to HK$100 and downgraded its rating to neutral from overweight, while Morgan Stanley slashed its target by a third to HK$120 and downgraded its recommendation to in-line from equal-weight.
Still, most analysts maintained their buy call on Meituan, as fundamentals remain intact.
Additional reporting by Jiaxing Li