J&T Express, a logistics giant that grew rapidly from its Southeast Asian origins through low prices and acquisitions, has hit a major regulatory wall after more than a decade of aggressive expansion. The company is now under formal investigation.
On June 11, the State Post Bureau announced an official safety production investigation into J&T Express (1519.HK). The announcement cited "frequent safety incidents," "recurring major hidden dangers," and a failure by headquarters to implement unified safety management across its network. Following the news, the company's share price plunged by as much as 8.08% during the midday session, closing the day down 4.89%. This wiped out approximately HK$4.2 billion (around RMB 3.65 billion) in market value. J&T Express responded that it would "fully cooperate with the investigation, deeply reflect on safety management issues, and resolutely implement rectification requirements."
This investigation is not an isolated incident. It follows a series of escalating regulatory actions, including a RMB 100,000 fine in Hunan in December 2025, two separate fines in Henan in March and April 2026, administrative interviews by postal regulators in Henan and Liaoning provinces in April, and another interview in Zunyi, Guizhou, on June 2. The mounting pressure culminated in the State Post Bureau's direct intervention.
Just two days before the investigation was announced, on June 9, the completion of a HK$8.3 billion (approximately RMB 7.215 billion) cross-shareholding deal between S.F.Holding Co.,Ltd. (002352.SZ) and J&T Express was finalized. S.F.Holding Co.,Ltd. now holds a 9.98% stake in J&T, becoming its second-largest shareholder, while J&T holds a 4.29% stake in S.F.Holding Co.,Ltd.. Announced on January 15, the deal was seen as the largest strategic cross-shareholding in China's logistics industry. Following the safety investigation into its partner, S.F.Holding Co.,Ltd.'s shares fell 2.53% to HK$30.86 on June 11, showing limited short-term pressure.
Since its listing on the Hong Kong Stock Exchange on October 27, 2023, at an issue price of HK$12 per share, J&T Express's market capitalization once exceeded HK$100 billion (about RMB 86.926 billion) on its debut. The stock price has since trended lower, with its market cap shrinking from its peak to around HK$80 billion (roughly RMB 69.541 billion). The investigation raises a critical question: why has this industry disruptor, known for its "nationwide delivery for 0.8 RMB" strategy, repeatedly faltered on the most fundamental safety standards?
Bai Wenxi, Vice Chairman of the China Enterprise Capital Alliance and Chief Economist for China, points out that the root cause of J&T's frequent incidents lies in the management challenges of its franchise model. "J&T has approximately 19,500 service outlets and 255 transfer centers in China, but the relationship between headquarters and the outlets is a loose commercial partnership, not a tight-knit management entity. When business volume surges and profit margins are compressed, each outlet operates its own service standards, severely squeezing safety investments," he explained.
Zhan Junhao, a renowned strategic positioning expert and founder of Fujian Huace Brand Positioning Consulting, also believes the State Post Bureau's investigation is not due to a single, isolated violation but rather a concentrated eruption of long-term governance failures. Beneath its massive scale, he argues, the company suffers from lax internal management, inconsistent compliance standards at terminal outlets, superficial daily safety checks, and accumulated systemic vulnerabilities, ultimately triggering the regulatory action.
As of the market close on June 12, J&T Express shares rose 1.67% to HK$8.5, with a total market capitalization of HK$82.627 billion (approximately RMB 71.296 billion). S.F.Holding Co.,Ltd. shares closed at RMB 34.36, up 0.09%, with a total market cap of RMB 180.9 billion.
String of Safety Incidents at J&T
The State Post Bureau's official announcement on June 11 cited "multiple production safety accidents," "perfunctory efforts in investigating and rectifying major accident hazards," and "inadequate implementation of unified safety management responsibility across the network." The severity of the language is rare in the express delivery industry in recent years.
The bureau explicitly stated that the investigation was initiated because companies using the "J&T" brand had been involved in multiple production safety accidents this year, with accident hazards repeatedly found at their sites. As the brand management entity, J&T Express failed to implement unified safety management for these related companies, violating the relevant provisions of China's Work Safety Law.
The regulatory level of this investigation is noteworthy. Previously, J&T faced measures primarily from local postal authorities, such as interviews or fines. For instance, the Changsha Postal Administration fined Hunan J&T RMB 100,000, and the Henan Postal Administration fined Henan J&T RMB 50,000 and RMB 20,000 on separate occasions. The situation has now escalated from local supervision to a direct national-level investigation.
Following the announcement, J&T Express issued a midday statement on June 11, saying the company "attaches great importance" and has "established a special task force to fully cooperate with the State Post Bureau's investigation while immediately launching a comprehensive network-wide safety inspection and rectification campaign." However, the statement did not directly address the core accusation of "headquarters' failure in safety management responsibility."
The frequency of J&T's safety incidents in 2026 has exceeded the industry average. In February, a fatal fall occurred at a Panjin J&T transfer center, where a 57-year-old loader was struck by cargo and fell. In May, an unmanned J&T delivery vehicle collided with a bus on a public road in Baotou, Inner Mongolia, though no casualties were reported. Also in May, a J&T warehouse in Malaysia caught fire, affecting a large area.
Domestically, Henan J&T was penalized twice by local regulators in March and April for "failing to implement unified management as required" and "failing to take measures to eliminate accident hazards," respectively. In April, postal administrations in Henan and Liaoning provinces interviewed J&T within the same month. On June 2, the Zunyi Postal Administration in Guizhou conducted a collective interview, pointing out issues including "inadequate implementation of unified management responsibility, delayed handling of disputes, and untimely warning of operational risks."
From network disruptions in Hunan to interviews in Guizhou, from repeated fines in Henan to the national investigation, why have J&T's safety management gaps remained unplugged? According to Zhan Junhao's analysis, the company has experienced numerous major issues in recent years, including fires, transportation accidents, and operational safety hazards, with a compliance incident frequency significantly higher than the industry average. From an operational model perspective, the company's efforts to compress costs have led to severe underinvestment in safety equipment updates, employee safety training, and outlet risk control, creating a long-term absence of safety budgets that sows the seeds for various accidents.
Zhan further stated that the high incidence of safety accidents is closely tied to J&T's aggressive scaling. The company rapidly captured market share and expanded its scale through low-price strategies and lenient franchise requirements. During this breakneck expansion, it neglected thorough vetting of outlet qualifications and subsequent control. This extensive growth diluted management capabilities, leading to失控 at the operational front lines and creating an industry anomaly where larger scale correlates with higher safety risks.
Breakneck Expansion Sows Safety Risks
The growth trajectory of J&T Express serves as a unique case study of expansion speed in China's express delivery sector.
Founded in Indonesia in 2015 by former OPPO Indonesia CEO Jet Lee, J&T leveraged resources from the BBK group to become a top player in Southeast Asia within just two years. It officially entered the Chinese market in March 2020, using an ultra-low-price strategy of "nationwide delivery for 0.8 RMB" to carve out a market niche. From 2020 to 2022, its domestic parcel volume skyrocketed from 2.08 billion to 12.026 billion pieces, representing a compound annual growth rate of 140.2%—an unprecedented pace in the industry's history.
J&T's expansion path was clear: it acquired Longbang Express in 2020 to obtain a domestic express license, purchased the domestic business of BEST Inc in 2021, and acquired Fengwang Express from S.F.Holding Co.,Ltd. in 2023. Through these three acquisitions, J&T achieved a network coverage that took competitors over a decade to build in less than four years. As of Q1 2026, J&T operates approximately 19,500 outlets and 255 transfer centers in China.
However, its expansion speed far outpaced the development of its management capabilities. The corporate DNA of "breakneck growth" has profoundly shaped J&T's operational logic. Bai Wenxi analyzes, "The root cause of J&T's frequent accidents lies in the management失控 of the franchise model... When business volume surges and profit margins are compressed, each outlet operates its own service standards, severely squeezing safety investments."
Bai further points out that J&T has long employed a management style of "replacing management with fines." Public information shows that a courier was once fined as much as RMB 14,000 for seven negative reviews. While such high-pressure tactics may maintain a superficial stability of service in the short term, they accumulate operational pressure on terminal outlets, further weakening their capacity for safety investment.
Financially, J&T reported a full-year 2025 net profit of $225 million (approximately RMB 1.598 billion), a significant 98.2% year-on-year increase. However, its revenue per parcel was only $0.30 (about RMB 2.13), with costs per parcel nearing that level. Under this "small profits but quick turnover" model, investment space for technology R&D, safety facilities, and personnel training is compressed to the limit.
As of the June 12 close, J&T's total market cap of HK$82.627 billion represents a decline of about 22% from its initial post-IPO valuation near HK$100 billion. Bai Wenxi believes, "The valuation gained at the expense of safety indeed carries liquidation risks. As regulatory risk escalates from local interviews and fines to a national investigation, failure to rectify effectively could lead to more severe penalties or even business restrictions. Simultaneously, with over 63,000 cumulative complaints on the Black Cat投诉 platform, the brand image of 'low price equals low quality' has become an obstacle to transformation."
Underlying Challenges for J&T
The frequent safety incidents at J&T Express prompt deeper reflection.
The number of J&T outlets has shrunk from 49,000 to 21,000, with the turbulence from network integration lasting for years. In Q1 2026, J&T's Chinese outlets decreased by 200, and network partners reduced by 100. This active contraction reflects the immense survival pressure on franchisees. Furthermore, imbalanced resource allocation exacerbates systemic instability. In Q1 2026, J&T's overseas parcel volume (primarily Southeast Asia) grew 79.9% year-on-year, while domestic growth was only 8.4%. The tilt of resources overseas has correspondingly weakened the maintenance and upgrading of the domestic network.
Bai Wenxi argues, "The inherent contradiction of the franchise model is that headquarters pursues scale expansion, while franchisees face the reality of thin profits, numerous fines, and hiring difficulties. When survival becomes the top priority, safety investment is naturally pushed aside." He notes that J&T's safety dilemma reveals the "impossible triangle" in the express industry—the difficulty of balancing cost, timeliness, and coverage. "J&T prioritizes cost, while S.F.Holding Co.,Ltd. prioritizes timeliness; they represent two extremes. But transitioning from 'trading price for volume' to 'improving quality and efficiency' is a hurdle J&T must overcome."
Zhan Junhao cautions that the imbalance between speed and safety is J&T's core pain point and serves as a warning for the entire industry. The express delivery sector cannot sacrifice safety for delivery efficiency. Companies must establish normalized safety control systems and incorporate safety costs as a non-negotiable operational necessity. The industry needs to abandon the mindset of extensive expansion and achieve synergistic development of efficiency, scale, and safety compliance.
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