Relief is on the way for hot, hungry trekkers on the Great Wall of China: 5-minute deliveries by drone

Tanner Brown

Market leader Meituan has launched a service that flies food, drink, medicines and other parcels from a nearby hotel rooftop to one of the ancient wall's watchtowers

It may not be visible from space, but tourists are now getting deliveries by drone while they scale the Great Wall of China.

Delivery giant Meituan (HK:3690) announced that it is now operating drone delivery services to a remote section of the Great Wall, on the outskirts of the Beijing region.

The move marks the capital's first drone food-delivery operation and follows existing services in the country's other first-tier cities: Shanghai, Guangzhou and Shenzhen.

Meituan said each order - available categories are to include food, drinks, medicines and more - will be hand delivered to the rooftop of a nearby hotel, where a worker will attach the package to a drone capable of handling roughly 5-pound, or 2.3-kilogram, loads.

The drone will then fly the goods to a watchtower on the far south section of the wall known as Badaling - a popular section but one that has traditionally had no access to food, drink, medicine or heat-relief products. Another Meituan worker stationed at the watchtower will receive the package and hold it until the customer arrives to pick it up.

The fee for the delivery is a mere 4 yuan, or 56 cents, on average, no higher than regular street deliveries, according to a report from the state-run Beijing Youth Daily. The flight normally takes no more than five minutes, in what would be a near-hour trek by foot.

Meituan is by far China's market-share leader in food delivery, with its yellow-clad moped drivers swarming cities and even found buzzing around rural locations. The move only expands the company's vast network, which reaches most of the massive country.

China's food-delivery industry is the world's largest, with estimated revenue of $450 billion this year. Nearly every restaurant in major cities participates in the Meituan or Ele.me delivery service.

Unlike in the U.S. and Europe, where service and delivery fees often make food delivery an expensive purchase from store to door, China's fees are minimal and often zero, with Meituan or other courier companies paying drivers part of the slice the delivery services collect from restaurants.

The ubiquity of food delivery in China makes for quite the street scene in big cities, particularly at lunch and dinner times. Moped drivers donning the yellow vests of Meituan or the blue shirts of Ele.me swarm the streets, sidewalks and crosswalks, whizzing precariously close to pedestrians as they to labor to make a day's worth of tiny payments add up.

According to conversations with drivers, payments per delivery usually don't exceed the equivalent of a single U.S. dollar, and are often less, making every second count.

This is where drone delivery, while prospectively reducing the number of available jobs for couriers, could ease congestion in city centers and make for safer rush hours.

But the seemingly futuristic service has not been without its hiccups.

On China's hottest social-media app, Xiaohongshu, or Little Red Book, users in Shanghai have complained that they've clicked on the drone option but a regular street driver wound up delivering their orders. A user identified as Green Sleeves said any order he placed of even moderate weight, such as noodles, repeatedly defaulted to surface delivery. "I can only get milk tea or coffee by drone," he said.

Beijing Youth Daily, however, reported that, "According to the relevant person in charge of Meituan Drone, we have completed more than 300,000 orders in total across the four megacities. The service can cover a variety of scenarios such as offices, communities, scenic spots, municipal parks, emergency medical care, campuses, libraries, etc., and provide users with more than 90,000 product choices."

Meituan is also doing what many powerful Chinese tech companies must do to operate unimpeded in the country: staying in the good graces of the authorities. In its PR material for the Great Wall service, Meituan positioned the new venture as focused chiefly on the delivery of heat-relief items, medicines and fluids, though food is on the menu, too.

Drone-delivery packaging entails bulkier and more wasteful materials than ground delivery, and Meituan said in its statement it was spending hours each day recycling delivery boxes.

The company has also managed to thrive amid a nasty bear run for Chinese markets overall. Meituan shares are up nearly 30% for the year, while the benchmark Shanghai Composite Index CN:SHCOMP is down almost 5%. Daily turnover on China's onshore equity markets has fallen to the lowest level in four years.

Tanner Brown covers China for MarketWatch and Barron's.

More Tanner Brown dispatches:

Luxury-goods brands fear their golden goose - China - is cooked

Chinese social media is brimming with anti-Kamala Harris, pro-Donald Trump posts

I spent a week on the Chinese version of E-Trade. Here's what I found.

China's economy is finally showing bright spots. Worrying signs remain.

China's prognostication is challenging. Witness 2023. And 2024 warning signs are flashing.

-Tanner Brown

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

08-29-24 0751ET

Copyright (c) 2024 Dow Jones & Company, Inc.