China’s richest individual has openly criticized major e-commerce platforms, accusing them of fostering price wars that have harmed numerous industries and businesses during the country’s
economic downturn.
In an unusually outspoken critique, Zhong Shanshan, founder of beverage company Nongfu Spring, also took aim at the Chinese government, accusing it of being “negligent” in allowing the proliferation of predatory pricing practices. These remarks, which were largely censored by state media, are notable as public dissent from prominent business figures in China often invites repercussions.
During a visit to a county in eastern China on Tuesday, Zhong condemned Pinduoduo, a popular e-commerce platform owned by PDD Holdings. He criticized the company’s pricing strategies, claiming they have disrupted the market and harmed local brands and industries.
“Internet platforms have undermined our pricing system. Specifically, Pinduoduo’s pricing approach has inflicted significant damage on China’s brands and industries,” Zhong was quoted as saying by The Paper, a state-owned media outlet. “This is not merely a case of bad money driving out good money—it’s an issue of industry orientation, where pricing has become the sole focus.”
Pinduoduo has experienced rapid growth in recent years, fueled by its aggressive pricing strategy.
In remarks that were less widely reported, Zhong also criticized the government for failing to address the issue. “The government has not intervened in this industry orientation. I believe this represents a negligence of duty,” Zhong said, according to a transcript published by Sina Technology and in multiple videos shared online.
CNN has reached out to Nongfu Spring and PDD Holdings for comment.
Zhong’s comments come amid an economic slowdown in China, where worsening job prospects and rising financial concerns have pushed consumers to tighten their budgets. This shift has reshaped consumption patterns, with discounts and low-cost options gaining popularity across industries—from groceries to electronics and automobiles. Even Western brands targeting premium markets have had to adjust their pricing strategies to compete.
Pinduoduo, founded in 2015 by Colin Huang, has capitalized on this trend, attracting consumers with its competitive pricing. Despite being a relatively young company, it has quickly risen to prominence in China’s e-commerce landscape.
Zhong’s remarks bring to mind the fallout faced by Jack Ma, Alibaba’s co-founder, who publicly criticized China’s financial regulators in 2020. Shortly after Ma’s speech, Ant Group, an Alibaba-affiliated financial technology company, was forced to cancel its $37 billion IPO. Ma subsequently disappeared from public view, and the Chinese government launched a sweeping crackdown on the tech sector—an effort that also impacted Pinduoduo.
Zhong’s candid comments come at the end of a difficult year. Earlier, he faced criticism from nationalist groups accusing him of lacking patriotism. This backlash affected Nongfu Spring’s stock value and sales, wiping tens of billions off the company’s market capitalization. By August, Zhong had lost his spot as China’s wealthiest individual to Colin Huang. However, Zhong has since reclaimed the top position with a net worth of $52.2 billion, according to the Bloomberg Billionaires Index. Photo by MNXANL, Wikimedia commons.
