Rumored to Open Next Month in Bustling Nanjing East Road
Taiwanese Ministry of Economic Affairs: "No Approval Granted"
Chinese media have reported that Luckin Coffee, the largest homegrown coffee chain in China and often referred to as the "Starbucks of China," is planning to open a store in Taipei, the capital of Taiwan, next month.
On November 27, The Asia Business Daily, citing Taiwanese outlets such as United Daily News, reported that Luckin Coffee, the leading company in the Chinese coffee market, has chosen Nanjing East Road, one of Taipei's busiest districts, as the location for its first store in Taiwan. It was also reported that a job advertisement featuring the Luckin Coffee logo has appeared on Taiwanese recruitment websites.
According to a source, "Interior construction is underway for a Luckin Coffee store next to the three-story Starbucks on Nanjing East Road, with the goal of opening on December 20." The source added that this move appears to be a "declaration of war" against its biggest competitor, Starbucks. Another source stated that the company planning to open the Luckin Coffee store in Taiwan is Sunway Holdings, which was registered in September with a capital of 5 million New Taiwan dollars (approximately 230 million Korean won). The source also raised suspicions that Sunway Holdings may be a company registered as Taiwanese capital but actually backed by Chinese capital.
Suspicions of "Disguised as Taiwanese Capital" in Market Entry
The representative of Sunway Holdings, Weng Jiangliqinq, previously served as a director at Sunda Food Seasoning Company, which supplies coffee beans to Luckin Coffee. Another shareholder, Cheng Zhengang, is the son-in-law of Weng and operates a Luckin Coffee import-export business in Shanghai, China, indicating that they are closely related, according to the source.
The Ministry of Economic Affairs of Taiwan stated that it has never approved an investment application from Luckin Coffee for operations in Taiwan. The ministry added that it will continue to monitor suspicions about possible links to Chinese capital and will conduct an administrative investigation if necessary.
Headquartered in Xiamen, China, Luckin Coffee was founded in Beijing in October 2017 and quickly grew to become the number one coffee brand in China. The company was listed on the Nasdaq in the United States in 2019, but was delisted the following year after revelations of fabricated sales. Since then, Luckin Coffee has restructured its management and ownership and has been working on a comeback, including expanding overseas to markets such as Singapore in 2023. In June of this year, it re-entered the U.S. market by opening two stores simultaneously in Manhattan, New York. Guo Jinyi, CEO of Luckin Coffee, recently stated that the company has about 30,000 stores worldwide, 400 million registered users, and approximately 170,000 employees.
In terms of market share in China's coffee sector, Luckin Coffee is far ahead of Starbucks. In 2019, Starbucks held a 34% market share in China by number of stores, but this figure dropped to 14% last year. In contrast, Luckin Coffee's market share last year exceeded twice that of Starbucks, reaching 32.6%.
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