JD.com CEO Says AI Will Cut Staff by 1/3, Grow Revenue by 1,000% in 10 Years

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That‘s quite the quote from JD.com‘s CEO via China Money Network:

Chinese e-commerce leader JD.com Inc will see revenue expand by 1,000%, while its employee head count will fall by one third over the next ten years due to the use of artificial intelligence technology, says company founder and CEO Richard Liu.

​Those cuts will be possible thanks to, you may have guessed by now, increased automation:

The cuts will be achieved via the use of unmanned warehouses, self-driving trucks, delivery robots and drones, he said yesterday at an industry conference in Shanghai. […]

By November 2018, JD.com will complete construction of its first unmanned warehouse where AI and robots will conduct all work related to parcel sorting, packaging and categorization. JD.com is also currently developing self-driving trucks, which will serve as mobile dispatch centers, releasing robots to make final deliveries.

​JD.com is already working on and securing drone delivery routes:

JD.com has signed agreements with Sichuan and Shaanxi province to build dozens of drone airports. Drones will be able to bring perishable fruits and wild mushrooms from remote places to urban dinner tables without employing land transportation.

(Highlights by me)

​We already wrote about those large drones for rural regions.

The context for JD.com is obvious: JD.com is increasingly betting on its logistics operations to differentiate itself from Alibaba. Thus, JD.com is giving investors a glimpse at how the company plans to make that as cost efficient as possible.

Also, the Chinese government is hard at work establishing „AI“ and related technologies in China. In a way, JD.com is also aligning itself with Chinese policy in a strong fashion.

China’s State Council issued a “New Generation Artificial Intelligence Development Plan” yesterday, outlining how the country will create the world’s leading AI industry, with a target value of RMB1 trillion (US$148 billion) by 2030. […]
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Specifically, the plan calls for the creation of leading companies and brands in China in the areas of drones, natural language processing and image recognition. The country will also aim to nurture the creation and growth of key companies in intelligent robots, smart cars and wearable devices. […]

In expectation that the application of AI will lead to job losses in certain sectors, the plan says that related government agencies should study changes in labor demand and help train workers for new jobs.

This also certainly makes it easier to get the permission to build drone airports.

Expect this topic to accelerate in China in the coming months.

​More on this topic:

​* JD.com Is Already Using 30 Self Designed and Engineered Drones for Delivery
​* JD.com Is Going Against Alibaba’s Lazada in Indonesia, May Do Local Acquisitions
​* Why JD.com’s Biggest Threat is WeChat
​* Two Reasons Why JD.com Invests $397 Mio. In Farfetch
​* Now, JD.com Creates a Logistics Unit as Well

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  1. […] JD.com CEO Says AI Will Cut Staff by 1/3, Grow Revenue by 1,000% in 10 Years […]

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  2. […] JD.com CEO Says AI Will Cut Staff by 1/3, Grow Revenue by 1,000% in 10 Years […]

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