Coupang's Counterattack: "Rocket Delivery Nationwide" with a 3 Trillion Won Investment

Ali's Domestic Investment Doubled
'Nationwide 100% Free Rocket Delivery' Goal
Expanding Job and Shopping Opportunities in Population-Declining Areas

Coupang will invest more than 3 trillion won by 2026 to provide free nationwide Rocket Delivery. This investment scale is more than double the 1.5 trillion won that Alibaba Group, which operates the Chinese direct purchase app AliExpress, plans to invest in the domestic market over the next three years. Through this investment, Coupang is expected not only to expand its business areas but also to contribute to improving population decline and the "shopping desertification" in rural areas.

Coupang announced on the 27th that it plans to invest more than 3 trillion won over three years from this year to 2026. This investment includes the expansion of new fulfillment centers (FCs), the introduction of advanced automation technology, and the advancement of the delivery network.

First, by 2026, Coupang will promote new construction and equipment investment for FC operations in more than eight locations including Gimcheon, Gyeongsangbuk-do; Jecheon, Chungcheongbuk-do; Busan; Icheon, Gyeonggi-do; Cheonan, Chungcheongnam-do; Daejeon; Gwangju; and Ulsan. Logistics facility investments in Gwangju and Daejeon will be completed this year, and operations will begin. The Busan and Icheon FCs are scheduled to start construction in the second quarter of this year, and the Gimcheon FC is planned to begin construction in the third quarter. The Jecheon FC in Chungbuk is planned to start construction in the fourth quarter of this year, with sequential expansion of new FC investments expected going forward.

Through this investment expansion, Coupang plans to sequentially increase Rocket Delivery areas nationwide and establish a service of virtually "100% free Rocket Delivery for the entire national population" by 2027. Currently, Coupang operates Rocket Delivery in 182 out of 260 cities, counties, and districts nationwide (70%). As the 'Kusegwon' (areas where Rocket Delivery is available) gradually expands from next year, Rocket Delivery is expected to be available in about 230 cities, counties, and districts from 2027. In terms of population, this is estimated to cover more than 50 million out of South Korea’s total population of 51.3 million as of the end of February this year.

Most of the areas where Coupang’s free Rocket Delivery will expand are designated as population decline areas (a total of 89) by the Ministry of the Interior and Safety. Coupang currently operates Kusegwon in 17 locations including Samcheok, Gangwon-do; Gimje, Jeonbuk; and Yeongam, Jeonnam. However, in three years, free Rocket Delivery is expected to expand to more than 60 population decline areas.

Notably, Rocket Delivery is expected to be introduced in regions with an aging population (over 65 years old) exceeding 40%, such as Bonghwa, Gyeongbuk; Goheung and Boseong, Jeonnam; Uiseong, Yeongyang, and Cheongsong, Gyeongbuk; and Hapcheon, Gyeongnam. It also includes areas where the population of 30,000, considered the last line against local extinction, has collapsed, such as Gurye and Gokseong in Jeonnam; Jinan, Jangsu, Imsil, and Sunchang in Jeonbuk; Yeongyang in Gyeongbuk; and Gunwi in Daegu.

Coupang’s expansion of new FCs and delivery networks is also expected to greatly contribute to local employment. Among Coupang’s total employees (over 60,000) in the first half of last year, more than 20,000 were young people aged 19 to 34. Employment of up to several thousand people per FC is expected in several regions where investments are currently underway.

Additionally, many local extinction areas are expected to see improvements in the ‘shopping desert’ where it is inconvenient to obtain daily necessities and groceries. For example, Dokye-eup in Samcheok, Gangwon, a former mining town with a significantly reduced population, had residents who had to drive more than 30 minutes to shop due to the absence of large marts. Since the introduction of Rocket Delivery in mid-last year, more than 5,000 orders have been placed monthly. The newly developed city of Sasong in Gyeongnam, which has many young couples in their 20s and 30s but lacks shopping infrastructure, has seen 1,000 to 1,500 orders daily since Rocket Delivery started in June last year.

As Coupang’s free Rocket Delivery network expands, local Wow membership subscribers are expected to shop easily and conveniently, significantly reducing unnecessary additional delivery fees and transportation costs. Also, Coupang Play content, product discounts, and Coupang Eats’ ‘unlimited free delivery’ will become available.

Professor Kang Hyung-gu of the Department of Finance and Management at Hanyang University said, “The expansion of Coupang’s Kusegwon not only improves consumers’ quality of life but also has a decisive impact on revitalizing the local economy through massive new employment. In particular, the activation of free Rocket Delivery in local grocery deserts will enhance the attractiveness of living in areas hit hard by aging and low birth rates, greatly contributing to balanced regional development.”