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more than 200 days have passed since yu yongfu stepped down from his management position at alibaba local life group at the end of march this year.

over the past six months, ele.me, the home delivery business of alibaba's local lifestyle segment, has tried to make a difference in its field, such as cooperating with 4,000 authorized apple stores across the country, launching the first iphone 16, investing 500 million yuan to subsidize new restaurants, and cooperating with taobao hourly delivery.

in contrast, although gaode, which is responsible for the in-store business, has also made new moves, they are mainly aimed at travel scenarios.

at the end of april this year, autonavi released a new taxi patrol network integration solution; in mid-july, it launched a taxi service in hong kong; in early september, autonavi added a ride-sharing business segment and operated in 65 cities in the yangtze river delta, pearl river delta, hubei province and other regions.

it is not difficult to see thatamap's new strategies are all aimed at its core business of internet travel.it has not yet come up with any new initiatives for the fiercely competitive in-store market.

after joining alibaba, autonavi was once highly anticipated and yu yongfu was appointed as the operator.

the first time yu yongfu led autonavi, he successfully won the mobile map war, with dau (daily active users) steadily exceeding 100 million; the second time he led the team, he was responsible for building autonavi into alibaba's local life flagship.

to this end, alibaba gradually integrated its word-of-mouth and other businesses into autonavi, hoping that the latter would make a difference in the in-store field. autonavi, ele.me and fliggy formed the "flying high" troika, competing in the trillion-level local life market.

but until yu yongfu left, autonavi had not really been able to squeeze into the local life table. meituan is still the largest player in the entire track, douyin has risen rapidly and ranked among the top two, and even kuaishou wants to get a piece of the pie; although autonavi has the support of alibaba, it is not the mainstream choice of in-store consumers and merchants.

after the end of the yu yongfu era, autonavi's new management has not made any special moves in the past six months, nor has it shown the momentum to fight a do-or-die battle in the local life sector, but has continued to focus on travel scenarios.

on the other hand, according to a report by snow leopard finance, a securities analyst who has been paying close attention to alibaba said that autonavi is currently profitable. in addition, a securities analyst summarized the current situation of alibaba local life group as follows: "autonavi is making a small profit, while ele.me is making a small loss."

alibaba management has publicly expressed its support for autonavi. in a conference call for the second quarter of fiscal year 2024 (third quarter of natural year 2023), alibaba group ceo wu yongming said that the group will continue to firmly invest in location-based technology services and continue to focus on the two business positions of local life, namely, using autonavi as the main body to develop technology services for travel and destinations, and using ele.me as the main body to develop technology services for instant home delivery.

but a year later,faced with autonavi, which has been "buddhist" and "small profitable" in the post-yu yongfu era, it may be time for alibaba to sell it.

after 2023, alibaba has been in a shrinking posture. zhang yong proposed "1+6+n", transforming the group into a holding company and promoting the independence of its businesses; wu yongming proposed "strategic focus", making e-commerce and cloud computing the highest priority. the strategic visions of the two group ceos are different, but their attitudes of reducing organizational fat and increasing leanness and shrinking the management radius are consistent.

in an internal letter in april this year, jack ma, who had just returned from his online travels, praised tsai chongxin and wu yongming, saying that "the new management... made decisive and clear choices about what we want and what we don't want."

but,the “letting go” campaign at the alibaba group level has not yet been completed.

previously, alibaba's main targets were its invested companies. in a financial report conference call in early february, tsai chongxin said that alibaba had set up a special team to execute capital market sales transactions. in the first nine months of 2023, the company will exit $1.7 billion in non-core assets; at the same time, it will gradually exit traditional retail business.

according to shijie.com, tsai chongxin said internally that non-core businesses cannot continue to "transfuse blood" to the main business.

alibaba has many businesses outside of its two pillars of e-commerce and cloud computing, such as youku in the entertainment sector, hema and sun art retail in the new retail sector, and autonavi and ele.me in the local lifestyle sector. strictly speaking, they all fall into the category of “non-core”.none of these pieces that are far from the center of the stage have been completely abandoned.

the reason is that these businesses generally suffer serious losses and are facing suppression from the industry leader.

for example, youku is the only one of the three long-video platforms that has not yet made a profit, and its user base is far behind the other two; hema has been mired in losses for many years, and after closing stores and laying off employees in many cities, it has only achieved profitability in its main business, hema fresh.

the group is willing to continue selling, but the assets that can be put on the shelf are not very good, and it is difficult to find a buyer, which is the bottleneck for alibaba to continue to promote its focus strategy. in this case, alibaba needs to take out a relatively high-quality non-core asset to "sample" and drive the rapid disposal of other assets.

amap, which is hard to rival in the field of mobile maps, may be alibaba's currentthe most impressive and painlessby marrying off autonavi, alibaba can recover a considerable amount of cash and significantly reduce the group's transfusion pressure; at the same time, it will also pave the way for selling more assets and push the next stage of transformation into depth.

judging from its map services alone, autonavi, which was led by yu yongfu twice, is undoubtedly a high-quality asset.

as a free tool application, autonavi has hundreds of millions of active users. according to data from market research company questmobile, from october 2022 to september 2023, autonavi's mau (monthly active users) reached 760 million, second only to wechat, taobao and alipay.30 million more than tiktok, ranking fourth among all apps.

in addition, as of march 2023, autonavi's dau exceeded 100 million for 24 consecutive months, second only to taobao, tmall and alipay in the alibaba system. in contrast, bilibili, which has a unique video content ecosystem, did not achieve dau of over 100 million until the third quarter of 2023.

on the other hand,amap’s traffic monetization capabilities are also remarkable.

currently, advertising is the main source of income for autonavi. the specific forms include various splash screens, pop-ups, banners, graphics, and links sponsored by manufacturers, as well as new ways of playing such as customized voice broadcasts when the navigation is started, during use, and at the end.

despite being criticized by many people for being "unpredictable", autonavi still earns a lot of money and has not lost any users. in the first quarter of this year, alibaba's local life group's revenue exceeded 14.6 billion yuan, a year-on-year increase of 19%. alibaba said in its financial report that this performance was driven by the rapid growth of orders from ele.me and autonavi.

in the second quarter, alibaba local life group's revenue increased by 12% year-on-year to 16.2 billion yuan, with a slower growth rate, but improved profitability. adjusted ebita (earnings before interest, taxes, and amortization) narrowed significantly from -1.982 billion yuan in the same period last year to -386 million yuan, and profit margin improved to -2.4%. considering that ele.me is still a big loss-maker, autonavi contributed most of the profits of the entire business segment.

in addition to monetization through advertising,another cash cow of autonavi is online ride-hailing.

autonavi entered the internet travel market through the aggregation model very early, and gradually connected to hundreds of small and medium-sized online ride-hailing platforms across the country, but was suppressed by didi for a long time. until didi was removed from the platform due to security review, autonavi's market share increased significantly, once occupying about 20% to 30%.

didi previously disclosed that in the second quarter of this year, the total order volume of its chinese travel (including online car-hailing, taxis, chauffeurs and ride-sharing) segment was 3 billion, with an average of 33 million orders per day. if the share ratio is 5:1, the daily order volume of autonavi taxi can reach more than 6.6 million orders.

recently, the capital market has warmed up to online car-hailing services, and second-tier platforms such as didi, ruqi, caocao, and xiangdao have started to go public. this also provides a more accurate measure of the potential value of autonavi.

taking ruqi travel as an example, its average daily order volume in 2023 was 267,000 orders, which is approximately 1/25 of autonavi; as of september 24, ruqi travel’s market value was approximately hk$4.2 billion.based on this rough estimate, autonavi's valuation could reach hk$105 billion.

in addition, the online ride-hailing platforms that have launched ipos have all launched the concept of robotaxi, trying to take advantage of the commercial operation of autonomous driving. however, as they are relatively small in size, their technical and financial strengths are also relatively limited. although robotaxi is a promising future, it may not be something that small and medium-sized players can achieve.

in contrast, if autonavi is looking for a buyer, it can tell a self-consistent robotaxi story based on the huge number of online ride-hailing users and orders, as well as its deeper technical accumulation and more abundant financial reserves.

however, behind the flourishing story of autonavi’s autonomous driving, there are also bugs in the technical route that need to be resolved.

it has been planning autonomous driving for a long time, but has focused on high-precision maps. but now, whether it is tesla, weili, wenjie, zhiji, xiaomi and other oems, or autonomous driving technology providers such as baidu, they all prefer real-time visual solutions based on lidar and cameras, that is, "heavy perception, light map". after long-term iteration and polishing by automobile manufacturers, this solution has l2-level assisted driving capabilities and has demonstrated high reliability in different environments.

under this circumstance, although the high-precision maps that autonavi has spent a lot of money and resources to build can theoretically achieve autonomous driving above l3 level, it is difficult to find large-scale application scenarios in the short and medium term due to the difficulty of research and development and high operation and maintenance costs, and faces the risk of becoming a "dragon-slaying skill".how to explain the long-term value of hd maps to potential buyers?this will be a big problem for alibaba and autonavi.

overall, although autonavi faces some challenges, it is still a "rich mine". however, if it continues to stay within the alibaba group, it will be difficult for autonavi to fully realize its value.

for alibaba, which is led by joseph tsai and wu yongming, under the major proposition of focusing on its core business, apart from the two cornerstones - e-commerce and cloud computing, there needs to be a question mark as to whether to continue investing in other businesses or even whether to hold them in their hands.

on the other hand, taobao, aliexpress and alibaba cloud are all facing increasingly fierce external competition and need more funds. the group also needs to concentrate more resources on these sectors. in particular, cloud computing has set off an unprecedented price war in the field of ai large models in may this year, which is bound to drag down the profit expectations of all players in the field, and alibaba cloud is also difficult to stay out of it.

this also means that the epoch-making transformation of alibaba led by cai and wu is far from over. e-commerce and cloud computing will be the top priorities, while non-core businesses such as amap are unlikely to receive large investments.

in fact,in the ten years since being acquired by alibaba, autonavi has never been the chosen one of the entire group.

in the alibaba ecosystem, amap has long been the infrastructure provider of lbs (location-based services), such as providing address services for taobao and map services for ele.me and hema. whether it is the c-end or the b-end, amap has never deviated from its tool positioning.

the resulting situation is that gaode seems indispensable, but is actually just a tool.

during yu yongfu's first time leading autonavi, he increased the dau from 20 to 30 million to over 100 million, second only to taobao and alipay within alibaba. however, few people think that autonavi has the status comparable to taobao and alipay, one of the reasons being that autonavi has too prominent a tool attribute.

another problem facing the "tool man" autonavi is that although it has many users, most of them leave after using it and are difficult to guide them to taobao and other alibaba services. autonavi's effectiveness in attracting new users to alibaba is not as obvious as it should be in theory; one manifestation is that the growth rate of alibaba's e-commerce business has slowed down significantly in recent years, but autonavi, which has more than 100 million daily active users, has not been able to act as a "white knight."

gaode once tried to break out on its own, and after 2021, it integrated a large number of local life-related functions. when you open gaode, in addition to basic services such as navigation and taxi-hailing, you can also find restaurant reservations, hotel reservations, surrounding tours, etc. you can even find dental cleaning, ophthalmology, cinemas, beauty, maternity and childbirth, home appliance repair, etc., which can be called a "meituan alternative".

however,amap has never been able to find the best way to closely integrate with alibaba's main business.

so far, among the large number of sub-businesses that autonavi has extended from maps, even the most mature taxi-hailing service is still outside of taobao and alibaba cloud. in the "1+6+n" division, autonavi, as a member of the "6", is not even as relevant to alibaba's main business as the "n" such as hema, sun art retail, and ali health.

in the mature mobile map market, unless there is a dramatic change, it is unlikely that the future revenue growth and profit performance of autonavi will exceed the normal range. even in the lucrative online car-hailing market, autonavi needs to compete with didi for orders, and the second place in a mature industry will not achieve a higher growth rate and profit margin than the leader.

if it were outside of alibaba, autonavi, with its annual revenue of hundreds of billions of yuan, would undoubtedly be a rare high-quality company;as a member of the alibaba camp, autonavi's current performance and future expectations seem to be not so good.

in addition to the lack of business linkage and low revenue share, amap is also somewhat distant from alibaba in terms of organizational culture.

as an "outsider", autonavi's uniqueness lies in that its managers and team did not consider integrating into alibaba as soon as possible, but instead worked hard to maintain their own characteristics and independence to avoid being assimilated by alibaba people. to this end, yu yongfu and other helmsmen played a game with alibaba group's management, and the latter also showed a high degree of tolerance.

when yu yongfu first took over autonavi around 2015, one of his conditions was not to implement alibaba's hierarchical management culture in the short term and that everything should be business-oriented, which was also supported by jack ma.

after 2016, yu yongfu temporarily left and turned to the ewtp fund. autonavi's independent development was not greatly affected. it even applied to establish the "autonavi innovation economic zone" in 2020, insisting on a relatively independent organizational culture and business approach at the cost of alibaba group not providing capital support.

in july 2021, yu yongfu came out again, and alibaba packaged autonavi, ele.me and fliggy into the local life group and handed it over to him. yu yongfu's management boundaries were further expanded, but the relative independence and non-alibaba cultural characteristics of autonavi and ele.me are still retained to this day.

in the history of autonavi’s development, yu yongfu’s two stints at the helm have had a profound impact; autonavi’s culture has also been marked by the yu family’s imprint."outlier" assets with limited value and shallow integration,it’s time for alibaba to put it on the shelves and look for buyers.

if alibaba sells autonavi, yu yongfu might be the most suitable buyer.

in the personnel adjustment at the end of march, yu yongfu was transferred to the ewtp fund and left the front line of business again. but in fact, the 48-year-old yu yongfu is at the golden age of a professional manager, and it is too early for him to choose to retire at this time.

for amap, there can be many business leaders, butthe only person suitable for the "number one position" is yu yongfu.

yu yongfu led autonavi twice, in 2015 and 2021. in the first time, yu yongfu helped autonavi escape the entanglement with competitors such as baidu maps, stand out from the siege, and occupy the top spot in the mobile map industry; in the second time, in addition to sorting out the map and online car-hailing business, yu yongfu also promoted autonavi to develop local life. although he failed to shake meituan's position, he also laid a good foundation.

in the eyes of his former subordinates, yu yongfu is quite popular. according to jiemian news, a former mid-level manager of uc said that yu yongfu "has a keen insight into the business and often raises key issues"; a grassroots manager of alibaba's local life business said that "(the management) gives yongfu too little time."

in the first 100 days after yu yongfu stepped down, the new management of autonavi did not come up with any refreshing strategies or measures. with the dramatic changes in the internal and external situations, autonavi cannot just move forward along the old track, but needs to push forward strategic changes more firmly in order to continue to break through. compared with the new management, yu yongfu is obviously a more suitable key figure.

in addition to yu yongfu,external companies such as meituan, douyin, and ctrip are also potential buyers of autonavi.

as a local life giant, meituan needs to continuously acquire traffic to drive the operation of the entire business model. by acquiring autonavi, meituan will gain a larger base of active users than its own traffic pool; autonavi's expertise in destination search and navigation can also be efficiently matched with meituan's expertise in in-store supply.

in addition, it is much more reasonable for consumers to jump from gaode to meituan to complete in-store consumption than to stay in the map app to buy and use coupons, and the experience is also smoother.

douyin also has reasons to take autonavi into its pocket. as the largest short video platform in china, douyin does not lack traffic, but consumers need to enter through content scenarios such as short videos and live broadcasts, and the local life consumption chain is longer and more complex than that of meituan. in-store content is both douyin's strength and its weakness in further improving transaction efficiency.

by acquiring and integrating autonavi, douyin will be able to identify and reach more specific consumer needs and establish a new link of "search-navigation-coupon purchase-verification". douyin's local life business will establish a commercial closed loop of search scenarios based on map navigation in addition to content scenarios, thereby gaining momentum in the competition with meituan.

as for ctrip, it occupies a dominant position in the ota (online travel agency) field, but it also faces the problem of traffic acquisition. the acquisition of autonavi can inject more accurate traffic in travel scenarios into ctrip and convert it into hotel and travel orders; at the same time, ctrip can also extend its tentacles to local life, adding greater imagination space.

for alibaba group,the sale of autonavi will be the most intuitive manifestation of "strategic focus".this move will not only bring many benefits in business and finance, but will also once again clarify the strategic direction of the tsai-wu era.

today, the "1+6+n" governance structure envisioned by zhang yong has basically run aground; except for e-commerce and cloud computing, all other businesses of alibaba are likely to be sold. especially for businesses with good qualifications and obvious bottlenecks like autonavi, alibaba should act decisively. just as zhang yong opened his era with double 11, alibaba in the cai-wu era might as well use the sale of autonavi as a symbolic starting point for a new stage.