DoorDash, the leading food delivery service in the United States, announced on October 29 that it is acquiring Instacart, a major competitor in grocery delivery. This transaction follows DoorDash's acquisition of the British platform Deliveroo earlier in October, signaling an accelerated race for market dominance. The deal values Instacart at $17 billion, or approximately 15.2 billion euros.
The announcement drew sharp criticism from New York City Mayor Zohran Mamdani, who highlighted the irony on social media X. He noted that DoorDash was prepared to spend billions on this acquisition just months after struggling to secure funds to pay its own couriers. In September, DoorDash admitted to a settlement with New York City, agreeing to pay over $131 million in back wages and fines for underpaying some of its nine million "dashers." The company had acknowledged the situation by stating, "We messed up," regarding the labor dispute.
Despite these recent controversies, DoorDash CEO Tony Xu, who founded the company in San Francisco in 2013, argues that workers will benefit from the merger with Instacart. Xu claims the combination will reduce the time between deliveries, thereby improving courier earnings. Furthermore, he asserts that merging the expertise of both companies will provide small businesses with the tools needed to remain competitive against retail giants like Walmart and Amazon.
The consolidation reflects a broader trend in the food delivery sector where efficiency is prioritized. The concept suggests that if plans proceed as envisioned by Deliveroo's owners, couriers may eventually make only one stop per trip rather than two separate deliveries for groceries and meals. However, this strategy faces competition from Walmart, which has also entered the segment through a partnership with Subway, aiming to achieve similar efficiencies in the delivery market.
Sources: Le Monde Économie.