WA and China in Headlines

(A round-up from January 2018)

Feb. 16: Chongqing-led group blocked in buying Chicago Stock Exchange

Chicago TribuneChicago Tribune reported that the decision of the Securities and Exchange Commission to reject a bid by a Chinese-led investor group to buy the Chicago Stock Exchange was a major blow to its international aspirations. The lead investor was from Chongqing, Seattle’s sister city: Casin Enterprise Group Co., which wanted to serve as a conduit to bring Chinese companies to the U.S. to raise capital. The SEC said it couldn't resolve concerns about the proposed ownership structure, which would have given 29% of the company to a China-based shareholder. CEO and president of the Exchange John Kerin expressed disappointment. An analyst at Greenwich Associates was quoted as saying, however, the Exchange's plan to help Chinese companies go public in the U.S. didn't require owning an exchange and that the motivation was a little unclear. --WA China Watch Digest 02/16/18

Feb. 5: Boeing transferring technologies to China Southern Airlines

China DailyChina Daily Guangdong reported that on Feb. 2 in Guangzhou, Boeing and China Southern Airlines (CSAIR) signed an agreement to convert passenger planes into cargo planes. Boeing will transfer technologies in a series of joint programs, including undercarriage overhaul for Boeing 777 and 787 planes, establishing a production line for converting Boeing 737 NG passenger planes into cargo planes, a support center for Boeing 787 planes, and support programs for Guangzhou Aircraft Maintenance Engineering Co (GAMECO). Boeing VP Stanley Deal was quoted as saying Boeing looked forward to the collaborating to meet demands for Boeing 787 operators, support regional airlines, promote the Boeing Converted Freighter program, etc. This was the first time Boeing made such technologies in aircraft MRO (maintenance, repair, and operation) available to China. --WA China Watch Digest 02/05/18

Jan. 25: Amazon has a potential competitor: Alibaba and Kroger

ReutersReuters reported that Chinese e-commerce and technology company Alibaba and U.S. grocer Kroger Co have had early discussions on working together. The discussions come, the report said, as U.S. e-commerce company Amazon has expanded aggressively into groceries with its acquisition of Whole Foods Market. While Amazon last week opened to the public its Amazon Go checkout-free grocery store, which relies on cameras and sensors to track what shoppers remove from the shelves, Alibaba runs its Hema supermarket chain as a test bed for the e-commerce firm’s move into traditional retail, where mobile phones are used to order, pay and get information about items. Reuters also said Alibaba’s talks with Kroger were not CEO-level yet. --WA China Watch Digest 01/27/18

Jan. 25: Boeing China breaking record in delivery of aircraft in 2017

NetEaseNetEase reported that Boeing China president John Bruns gave a press conference on Jan. 24 on Boeing’s achievement in 2017. He pointed out that, for the first time, Boeing broke the record by delivering 202 aircraft to China, after six years of delivering over 140 aircraft a year. By the end of 2017, China’s fleet of Boeing planes reached 1,500. In addition, Boeing also began construction of its 737 completion and delivery center in Zhejiang, expecting first delivery of 737 Max by the end of 2018. Boeing’s composite materials company in Tianjin also assembled its millionth product in 2017, and with its number of employees growing bigger than that of its competitors. With the competition of high speed trains, Boeing estimated that China would still need 7,000 new aircraft in the next twenty years. --WA China Watch Digest 01/27/18

Jan. 25: Starbucks Shanghai Roastery one day sale doubles one week sale of U.S. store

CNBCCNBC reported that the eight-week old Starbucks Shanghai Roastery is raking in insane sales: its one day sales more than doubles what a traditional U.S. store makes in an average week. It quoted Howard Schultz, Starbucks' chairman, "Our U.S. Starbucks stories, on average, do about $32,000 a week… The Roastery in Shanghai, after eight weeks of operations is doing, on average, twice that not each week, but each day." Shultz then continued to say that in the history of Starbucks, he had never, ever, seen anything remotely like what happened when they opened the Shanghai Roastery, as it shattered every sales record in the history of the company. --WA China Watch Digest 01/27/18

Jan. 5: Chinese homebuyers file lawsuit against Realogics Sotheby broker for inflating prices

Seattle TimesMike Rosenberg at the Seattle Times reported that a lawsuit had been filed by two plaintiffs from China who bought homes in Kirkland, alleging that their broker at Realogics Sotheby’s International Realty was actually working on behalf of the builder selling the homes. They were told there were multiple offers on the table and that they needed to bid more than $2 million each to buy the homes. But when they arrived in the area after the deals closed, they discovered the homes weren’t as promised, and that there had been no evidence that other buyers were interested in the homes. The plaintiffs are Jie “Gabby” Jiao, and the married couple Maoqi Zhang and Wei Fan; the defendant is Realogics Sotheby’s broker Connie Blumenthal. –WA China Watch Digest 01/06/18

Jan. 4: Starbucks spends $1.4 billion and buys 1,400 stores in East China

PSBJThe Puget Sound Business Journal reported that Starbucks closed a deal on Wednesday, spending $1.4 billion and buying 1,400 stores in East China. The Journal said Starbucks announced back in July that it would spend $1.3 billion to buy out the remaining 50% of a partnership with two other companies, or 1,300 stores, in Shanghai, Jiangsu and Zhejiang provinces. The acquisition on Wednesday, the Journal said, meant that Starbucks had added 100 stores in the past six months. Back then, Starbucks CEO Kevin Johnson said, “Unifying the Starbucks business under a full company-operated structure in China reinforces our commitment the market.” The report said Starbucks now operates 3,000 stores in 136 Chinese cities, opens a new store every 15 hours. --WA China Watch Digest 01/04/18

Jan. 2: Chongqing showcased in Times Square New Year’s Eve celebration

East Day NetSeattle’s sister city Chonqing took part in the Times Square New Year's Eve Countdown celebration on Dec. 31, 2017 in New York City, according to East Day news. As the official partner city of this year’s celebration, Chongqing sent its representatives to Times Square, the crossroads of the world, promoted its famed landscape and cultural heritage, and presented the revelers with its Tongliang Dragon Dance. Along with those from Chongqing Tourism Bureau, also appearing at the ceremony were officials of the New York City, the Chinese Consulate in New York, Times Square Committee, and U.S.-China Friendship Association. A banner held up by the Chongqing group in Times Square read, “Happy New Year 2018. Chongqing, China Welcomes You!” --WA China Watch Digest 01/02/18