AliExpress turnover in Europe decreases

Alibaba Group announced its financial results in Q3 this week.

International marketplace AliExpress has continued its decrease in turnover in Q3 this year.

According to the company, this stems from a decrease in orders after the new EU VAT rules came into effect.

Overall, the Alibaba group reports a loss of 2,8 billion euros.

AliExpress is the business-to-consumer subsidiary of Alibaba Group. It is well-known for its low prices and long delivery times. Last year, it launched a logistics solution in Europe to offer a 10-day delivery guarantee.

The Chinese ecommerce company Alibaba invested in an expansion in Europe through its Southeast Asian offshoot, Lazada. But while Alibaba has been in the region for over a decade with AliExpress, its overall track record has been underwhelming.

Last year, the site had just a 4 percent market share in Western Europe, far behind Amazon’s 20 percent, Euromonitor International data show. In Eastern Europe, its 5 percent share also trails Russia’s Wildberries and Poland’s Allegro.

In total, the revenue of Alibaba Group was 29.1 billion dollars in Q3. This is a growth of 3 percent, when compared to the same period a year earlier.

Internationally, the group seems to be slowing down. During the September quarter, the combined number of orders of Lazada, AliExpress, Trendyol and Daraz declined by 3 percent year-over-year, primarily driven by declining orders of Lazada and AliExpress, partly offset by strong order growth of Trendyol, as it said in a press release.

The company expects that the marketplace will continue to face challenges in cross-border ecommerce demand in Europe, because of the depreciating euro and increasing logistics costs.