Ordering groceries should be a fairly simple transaction. You pick your food, choose a delivery window, and decide whether the convenience is worth the cost. Having competing services gives you somewhere else to go when that last part stops making sense, which is why DoorDash buying Instacart makes me uncomfortable.
DoorDash has announced an agreement to acquire Instacart for approximately $17 billion, valuing it at $65 per share. The companies expect the transaction to close in late 2027 or the first half of 2028, subject to shareholder and regulatory approvals. For now, they remain separate businesses.
DoorDash is selling this as a way to help local stores compete, and there are some appealing promises. DashPass and Instacart+ would be available for one membership fee, while Instacart customers could gain access to more than 50,000 additional stores. DoorDash also expects to retain the Instacart brand and app.
A combined subscription could be useful, especially for households already paying for both services. I am not going to pretend saving money is a bad thing, but a membership bundle does not answer the bigger question of what happens when two competitors stop competing.
Keeping two apps on your phone does not preserve two independent businesses fighting for your order. If both ultimately answer to the same owner, switching between them becomes a very different kind of choice. The icons might look different, but your money ends up under the same corporate roof.
That matters because competition gives consumers some bargaining power without requiring them to negotiate anything. A delivery service has a reason to improve its prices, service, or promotions when an unhappy customer can move to a rival. Buying that rival weakens one source of pressure to do better.
DoorDash was already expanding its grocery business before announcing this acquisition. As the Associated Press reports, it began grocery delivery in 2020 and subsequently expanded its relationships with major retailers, including Kroger. This deal would bring an established grocery competitor into a business that has already been pursuing those customers.
To be clear, the announcement does not establish that delivery fees will rise or discounts will disappear. Those are risks worth examining, not outcomes anyone can responsibly declare certain today. My concern is that consumers would lose an independent alternative, while the promised benefits depend on how the combined company chooses to operate.
The membership pitch deserves particular scrutiny. DoorDash estimates that combining the subscriptions would save members $100 million annually, but membership is only one part of what consumers spend. A useful assessment would also consider the total cost of ordering groceries over time.
A subscription can look like a bargain while the checkout total tells a less appealing story. Regulators should ask what commitments would protect consumers beyond the initial appeal of getting two memberships for one fee. An attractive bundle today should not settle questions about pricing power tomorrow.
There are also implications for the stores these services depend on. The companies’ post-close commitments say grocers would remain free to work with other delivery platforms, which is welcome. However, permission to use a competitor is only part of the equation; retailers also need competing services capable of reaching their customers on worthwhile terms.
The same distinction applies to delivery workers. DoorDash promises more opportunities to earn, but more available orders would not automatically mean better pay for the time and expenses involved. Workers deserve scrutiny of the economics, just as customers deserve scrutiny of their checkout totals.
I understand why DoorDash would want Instacart, and I can see why a combined membership might appeal to customers. What I do not accept is the idea that making a delivery company bigger automatically makes grocery shopping better. Consumers need meaningful alternatives when a service becomes too expensive or fails to deliver, and this deal would put two of those alternatives under one owner.
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