Lao Gan Ma Denies AI Layoffs as 600-to-48 Claim Spreads Online
Lao Gan Ma, the chili crisp brand that has been a fixture of Chinese kitchens for decades, found itself at the center of an online storm this week after social media posts claimed the company had used artificial intelligence to cut its workforce from 600 to 48. On October 26, the company’s official hotline told a reporter that the rumor was untrue, that no such information had ever been released, and asked consumers to view the claims rationally. The story had climbed back onto trending lists, drawing attention to how quickly a single unverified post can shape public perception of a well-known brand.
The rumor appears to have grown out of a speech by Li Xin, Lao Gan Ma’s executive vice president and chief quality officer, at a quality development conference in Guizhou province in 2026. According to reports, Li said that after four years of quality consolidation and system optimization, the company reached revenue of 5.4 billion yuan (about $760 million) in 2025, its highest ever. That figure was quickly picked up by self-media accounts, which stitched it together with claims about AI-driven layoffs. The company has not released details about its current headcount, leaving a gap that speculation filled.
The episode illustrates a familiar pattern in China’s internet ecosystem: a snippet of corporate good news becomes raw material for a more dramatic narrative. AI is a particularly potent hook. As factories across the country adopt automation, stories about machines replacing workers resonate with anxieties about employment and the pace of technological change. For a brand as recognizable as Lao Gan Ma, whose glass jars of spicy oil are stocked in supermarkets from Beijing to overseas Chinatowns, the claim carried extra weight.
Lao Gan Ma was founded in the late 1980s by Tao Huabi, a widowed mother who started selling noodles with her own chili sauce from a small stall in Guizhou. The company grew into one of China’s most famous food brands, known for its simple recipe and stubborn refusal to change. Its reputation rests on consistency and a kind of homespun authenticity. That makes any suggestion of large-scale automation or worker displacement particularly damaging, because it cuts against the image the brand has cultivated for nearly four decades.
Whether the denial will be enough to restore trust is an open question. Chinese consumers have become more skeptical of corporate statements, especially when they conflict with viral posts that feel more immediate and shareable. The company’s response was brief and did not offer details about its production methods or workforce, which may leave room for doubt. In the past, Lao Gan Ma has weathered controversies over recipe changes and succession, but each one has required more than a press line to settle.
The broader context is a national conversation about AI’s role in manufacturing. China is the world’s largest industrial robot market, and companies across sectors are experimenting with automation to cut costs and improve quality. For food producers, automation often means packaging and sorting lines rather than wholesale workforce replacement. But the distinction is easily lost in a headline. Lao Gan Ma’s case shows how a single claim, even a false one, can force a traditional brand to engage with a tech debate it never sought.
For now, the company’s hotline has done its job: the rumor has been labeled false. But the conversation has already shifted from whether the claim is true to whether the brand can afford to stay silent on how it actually makes its sauce. In an era when consumers want transparency, a simple denial may not be the end of the story.