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Tag: China

  • Six European Mobile Wallets and Alipay Collaborate to Promote Digital Payment Interoperability across Europe

    Six European Mobile Wallets and Alipay Collaborate to Promote Digital Payment Interoperability across Europe

    Six prominent mobile wallets across Europe, together with Alipay, announce today a collaboration to promote QR code-based digital payment interoperability for travelers both in Europe and from China.

    Bluecode, ePassi, momo pocket, Pagaqui, Pivo, Vipps and Alipay are working towards adopting a unified QR code, marking a milestone in connecting Europe’s thriving yet fragmented mobile payment landscape. When fully realized, users of the six participating European digital wallets will be able to make QR code-based payments with their home apps to local merchants in 10 European countries where those apps are accepted. At the same time, merchants that already accept mobile payments via the six apps in their respective domestic markets will also be able to easily accept payments made by customers of the other countries covered by the collaboration. In addition, Alipay’s Chinese users can also make payments to merchants that accept these wallets.

    Helsinki-based ePassi and Oslo-based Vipps have started to prepare the roll-out of this QR code format for users across several Nordic countries, while the Spanish payment company MOMO, Portugal’s Pagaqui and Austria’s Bluecode intend to extend the collaboration further later this summer in their respective home markets. Built on the back of a similar partnership announced in December between two Nordic firms, Vipps and ePassi, and Hangzhou, China-based Alipay, this open-ended collaboration is expected to continue to expand into more European countries and companies in the future.

    The collaboration, the first of its kind in Europe, will bring together the six mobile wallet partners’ users, which are more than 5 million in total, and around 190,000 merchants in Europe, as well as a fast-growing number of travelers from China. In addition, as each of the participating firms grows the user base and merchant network, the growth is also beneficial to all of the collaborating firms’ merchants and users, respectively.

    The partnering firms have agreed to apply a compatible QR code format provided by Alipay, the world’s most-used app outside social apps. ePassi and Bluecode will offer technical services to the participating wallets to simplify the integration process among them.

    “With over 12 years’ experience, ePassi is already a mobile payments front-runner in QR code-based payments in the Nordic and selected European countries. We are proud and honored to be part of this unique collaboration of European payment wallets, and to support other partners with their integration as well,” said Risto Virkkala, CEO of ePassi.

    “It has always been our vison to enable European banks with a widely accepted European mobile payment offering”, said Christian Pirkner, CEO of Blue Code International. “As a payment solution provider, we naturally support this collaboration of European wallets agreeing on a technical format. Even more compelling that it is compatible with Asia’s leading lifestyle app Alipay.”

    The announcement came on the heels of Alipay activating the eight-year global partnership with UEFA in Porto, where the inaugural Nations League Final just concluded. “We feel honored to help promote a smart lifestyle and digital experiences in Europe, while continuing to connect more merchants with more Chinese tourists. We believe mobile payment is a universal language that can help connect people just as football does,” said Eric Jing, Chairman & CEO at Ant Financial.

    Alipay currently serves over 1 billion users with its Asia-based local e-wallets partners. Launched in 2004, Alipay has evolved from a digital wallet to a lifestyle enabler. Users can hail a taxi, book a hotel, buy movie tickets, pay utility bills, make appointments with doctors, or purchase wealth management products directly from within the app.

    In addition, Alipay’s technology is being used to enable over 200 Chinese financial institutions to improve efficiency and lower operational costs. Alipay’s in-store payment service covers over 50 markets across the world, and tax reimbursement via the app is supported in 35 markets.

    Nearly 60 per cent of overseas bricks-and-mortar merchants that adopted Alipay saw a subsequent growth in both foot traffic and revenue, according to a report by Nielsen earlier this year.

    “Momo were first to process payments via mobile devices in Spain six years ago, starting in Malaga. Since then, we’ve expanded to also help our merchants increase their sales by accepting QR payments from thousands of Chinese tourists via Alipay.” says Mariano de Mora, CEO of MOMO Group. “We are excited to see how this collaboration with other European payment wallets can bring millions of users to our merchant network here in Spain and offer our users hundreds of thousands of places to pay with their local momo app across Europe.”

    “This unique cooperation is a testament to how collaboration in Europe can simplify the market for businesses and users to create better outcome for everyone.” said Rune Garbog, CEO of Vipps. “We are extremely enthusiastic about new partners joining this collaboration, giving all our combined users broader possibilities for using their preferred mobile app also when travelling abroad.”

    “As a Portuguese company and a stakeholder in this project, Pagaqui rejoices in the choice of venue for this announcement, and is extremely proud to participate in such an ambitious and innovative undertaking”, says João Barros, CEO of Pagaqui. “As in football, European firms can be more successful when playing together as a team. This is a real game changer for businesses and users across Europe, and we are excited to see so many partners taking part in it.”

    Pivo, the largest mobile wallet in Finland with over 1 million registered users, is welcoming the collaboration and the benefits it will provide to all mobile wallet customers. “Interoperability will allow us to offer a simple and unified customer experience across services and points-of-sale internationally. The collaboration will create additional value for Pivo as a service platform, and it is a welcome initiative for the ecosystem and our customers,” said Masa Peura, CEO of Pivo.

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  • Parkson Holdings Extends Store Lease in China

    Parkson Holdings Extends Store Lease in China

    Parkson Holdings’ Beijing operation Parkson Retail Development (PRD) has extended a department store lease in the city until the end of 2021.

    PRD’s Hong Kong-based owner PRGL announced in a stock exchange filing in Hong Kong the firm has signed a new lease agreement for a 189sqm area from the China National Arts and Crafts Group in Beijing’s Fuxingmen. It has agreed to pay a quarterly rental of RMB2.5 million (US$361,800).

    The group has been conducting retail activities at the site for 20 years and this lease follows renewals of seven other leases in the same building back in February. In total, Parkson leases 23,887sqm in other areas of the museum from the same landlord for terms extending as far as the end of November 2028.

    A statement from PRGL said the operation has brought stable revenue in the past, and that the new lease brings continuity to the group’s retail efforts in a location familiar to its long-term customers.

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  • Versace to expand Asian store network

    Versace to expand Asian store network

    More stores, broader range, fewer brands as fashion icon tries to double sales. Versace will open its largest store yet in China this week, part of a concerted plan by the fashion label’s new owners to expand its footprint globally.

    Capri Holdings, which also owns Michael Kors and Jimmy Choo, bought Versace from Donatella Versace late last year for US$2.2 billion. It is now implementing a plan to double the label’s worldwide sales with at least 112 new stores scheduled by 2022 along with a refurbishment program for the existing network. The new Beijing store – details of which are scant at present – is a key step in that plan.

    Worldwide, Versace has 188 stores currently and wants to reach 300 within three years. Asia will be a big benefactor from the plan, already accounting for more than half the network. China alone has 40.

    Along with new openings and revamps of existing stores, Versace will boost its product offer, adding more handbags, footwear and leather goods to its high-end clothing range. Accessories currently account for just 35 per cent of Versace’s sales and the company wants to lift that to 60 per cent.

    “It’s very clear: The productivity in our stores is not what it should be,” CEO Jonathan Akeroyd told an investors briefing this week. He plans to double the sales per square foot across the network.

    “We need to rapidly increase productivity and this will really be the real driver to take us to our US$2 billion revenue target.”

    Versace’s marketing strategy will be revised, with less focus on fashion shows in favour of a stronger social media presence.

    The company has quietly dropped its diffusion brands Versace Collection and Versace Versus and new stores will all bear the core Versace brand name alone.

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  • Samsung cuts production in China as local struggles continue

    Samsung cuts production in China as local struggles continue

    Samsung has been struggling in the Chinese smartphone market for quite some time. In fact, around six months ago the company shut down one of its factories in the region. Now, suggesting things have improved little, Samsung has confirmed that its scaling back production at its only remaining Chinese manufacturing plant.

    At its peak back in 2013, Samsung accounted for an impressive 20% of all smartphone shipments in China. But as local rivals with thinner profit margins became more competitive, the company’s sales quickly began to decline. Over the course of the past year, Samsung has struggled to retain a 1% market share and, while the Galaxy S10 has certainly boosted performance, it seems sales still aren’t at the required level.

    The company’s plants in China previously served both local and international markets, but over the past few years Samsung has shifted a big portion of its production over to countries such as India, leaving Chinese factories to cover local demand only. As such, any cuts suggest the company’s revival strategy isn’t going as smoothly as hoped.

    The South Korean-based brand hasn’t yet revealed the exact extent of these latest production cuts, so the adjustments could potentially be minimal. But it’s reported that Samsung is offering voluntary layoffs with compensation to interested employees until the 14th of June.
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  • Huawei insists global smartphone production levels are as Expected

    Huawei insists global smartphone production levels are as Expected

    There’s been much ado about Huawei’s tough road ahead as key US partners and major parts suppliers are prepared to turn their backs on the world’s second-largest smartphone vendor at the end of a 90-day reprieve granted shortly after President Trump’s announcement of a potentially business-ending ban.

    But although it’s pretty obvious the political tensions are already negatively impacting the Chinese company’s sales and brand image in the Western Hemisphere, Huawei reps and executives continue to insist the situation is not as bad as certain reports make it out to be. After essentially suggesting the White House didn’t do the tech giant any favors by giving it the aforementioned “stay of execution”, Huawei is adamantly denying a fresh rumor regarding current smartphone production.

    In a short statement issued to Cnet and a number of other international news outlets, the company specifically and explicitly refuted the claims made in a Chinese media report about a Foxconn manufacturing shutdown of Huawei mobile devices. Apparently, “global production levels are normal, with no notable adjustments in either direction.”

    At first glance, that may seem reassuring, but clearly, these are extremely volatile circumstances, with lots of moving parts and unpredictable future developments. Just because Huawei might be going about its business like nothing has happened or is about to happen, that doesn’t mean a production halt or at least a downgrade are not in the pipeline. If the embargo on collaborations with US companies stands, market researchers expect a significant slowdown of the Chinese tech giant’s incredible recent growth.

    For the time being, it looks like Huawei is working on the assumption the US-China trade war will somehow cool down in the next couple of months, allowing it to continue selling hundreds of millions of Android phones around the world.

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  • Lower tourist spend hits Tiffany & Co sales

    Lower tourist spend hits Tiffany & Co sales

    Tiffany & Co sales were hit by what CEO Alessando Bogliolo described as “dramatically lower worldwide spending attributed to foreign tourists” during the first quarter.

    Globally, sales fell by 3 per cent in the three months to April 30, to US$1 billion and comparable sales fell by 5 per cent. “Significant foreign exchange headwinds” were also responsible for the result, with sales down a more modest 2 per cent on a constant-currency basis.

    While not releasing breakdowns by country, Bogliolo said global sales attributed to local customers, led by sales in China, grew year on year. “We believe this growth in sales to local customers reflects progress in executing our strategic priorities, including innovations across products, communications and the customer experience, and that Tiffany is positioned for improving trends in the second half of 2019.”

    Net earnings of $125 million were 12 per cent lower than the prior year’s $142 million.

    Tiffany & Co sales in Asia-Pacific declined 1 per cent to $324 million and comparable sales declined 5 per cent due to the effect of foreign currency translation; on a constant-exchange-rate basis, total sales rose 3 per cent and comparable sales were unchanged.

    “These results reflected a continuation of strong growth in Mainland China and mixed results in other markets,” the company said in a statement. “These sales results also reflected lower spending attributed to foreign tourists.”

    In Japan, total net sales declined 4 per cent to $145 million and comparable sales declined 4 per cent, but on a constant-exchange-rate basis, total sales and comparable sales were equal to the prior year. These results were also affected by lower spending attributed to foreign tourists.

    In Europe, total net Tiffany & Co sales declined 4 per cent to $102 million and comparable sales declined 7 per cent. In the Americas, total net sales declined 4 per cent to $406 million, and comparable sales declined 5 per cent.

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  • Alibaba’s 618 Mid-year Shopping Festival targets Specific China Regions

    Alibaba’s 618 Mid-year Shopping Festival targets Specific China Regions

    Alibaba Group has launched this year’s 618 Mid-year Shopping Festival from Taobao and Tmall, allowing brands and merchants to tap into China’s less-developed regions with 1.5 million new products and multiple promotions.

    This year’s festival aims to engage customers in emerging cities, counties and villages across China. To do so, Taobao and Tmall are boosting promotional resources to elevate excitement and help brands reach this rapidly growing market. Altogether, more than 200,000 brands and retailers will participate in the shopping event.

    The shopping event officially started on June 1 and will continue though June 18. Within the first hour, from midnight to 1am, gross merchandise volume (GMV) exceeded that of the first 10 hours last year. And at 11.23am, less than 12 hours after the start, total GMV surpassed last year’s full-day figure.

    Branded products are so far proving extremely popular. Top brands like Apple, Xiaomi, Haier, Aux, Midea, L ‘Oreal, Lancome, Nike and Adidas each notched more than RMB100 million in sales in the first hour. Among them, Apple sold over RMB100 million worth of products in two minutes and 45 seconds, while Midea and Nike both hit that mark in four minutes.

    “In addition to rising discretionary spending, consumers in China’s less-developed regions are becoming more-sophisticated shoppers who are looking for lifestyle upgrades,” said president of Taobao and Tmall Jiang Fan. “This increased consumption potential could mean bright prospects for our merchants. People in these areas might have less access to physical shopping facilities than those in big cities, and this year we are working closely with our partners to address their needs and offer them the same good quality products on our platforms with innovative and fun programs.”

    The number of people living in smaller cities and rural areas accounts for nearly 70 per cent of China’s total population, according to Chinese market-research firm Analysys. These consumers are catching up with first- and second-tier markets in valuing quality over price. Tmall’s figures also show that more than half of the sales generated on its Luxury Pavilion comes from customers outside China’s first- and second-tier cities.

    In view of this trend, Taobao and Tmall are leveraging Alibaba Group’s ecosystem and technology and an array of marketing channels and tools to build momentum from early June. Key initiatives to offer opportunities in fast-growing markets and enhance customer engagement include:

    Tmall product debuts – About 1.5 million products will debut on Tmall during the festival with customers enjoying heavyweight promotional offers on these items. Many were developed by brands on an accelerated cycle, thanks to consumer insights provided by Tmall. In addition to deals on the 1.5 million new products, brands are offering millions of other products at a discount. All products are available to consumers nationwide, but brands are paying special attention to the needs and desires of customers in lower-tier Chinese cities.

    Flash Sales – Alibaba’s flash sales channel, Juhuasuan, allows brands to offer deep discounts to reach new customers in fast-growing markets. Juhuasuan will organise dozens of 618-themed group-selling campaigns featuring must-buy items recommended by brands. Statistics show that Juhuasuan is a tried-and-true channel for brands to attract first-time buyers. Since last year, 80 per cent of the transactions for branded goods through Juhuasuan were from new customers, and nearly half were from lower-tier cities.

    Taobao Livestreaming – Few marketing tools have proved more effective than livestreaming for brands to introduce and recommend 618 products to potential consumers in less-developed regions. Last year, sales generated by Taobao Livestreaming exceeded RMB100 billion. This year, US brands, including Stadium Goods, the streetwear and sneaker resale store backed by LVMH Luxury Ventures; Korean beauty brands, like Laneige and Innisfree; and Japanese cosmetics brands Shiseido will host livestreams for 618.

    Daily Deals – This channel on the Taobao app provides special offerings directly from manufacturers and is highly popular among consumers from less-developed areas in China. Equipped with insights from consumer preferences and behaviors, manufacturers are able to adjust their production processes on a real time basis to meet consumer demands. These manufacturers will introduce 100,000 promotional items for the 618 celebration.

    With a reach of 654 million annual active consumers in China, strong technical support and in-depth market knowledge, Alibaba’s ecosystem is offering a strong growth potential for brands.

    Alibaba Group’s annual results this year reflect that growth potential, with more than 70 per cent of the more than 100 million new active users added during the year ended March 31, 2019 coming from less-developed cities.

  • Huawei’s troubles could hurt the entire smartphone market

    Huawei’s troubles could hurt the entire smartphone market

    After putting on a brave face for the last few weeks and insisting the Chinese company is prepared for whatever US President Trump might throw at it down the line, Huawei has finally acknowledged its incredible recent rise through the ranks of the world’s largest smartphone vendors is likely to slow down.

    But while Apple, Samsung, and Xiaomi are expected to derive important gains from Huawei’s global losses, Canalys is taking a look today at another big potential loser in this extremely complicated equation. The research firm thinks the entire smartphone industry will be hurt by “uncertainties surrounding the US/China trade talks, the US Executive Order signed on 15 May and subsequent developments.”

    Although it’s obviously impossible to project the long-term repercussions of current tensions between the US and Chinese governments, as “subsequent developments” remain up in the air, Canalys is already reducing its 2019 smartphone shipment forecast to 1.35 billion units. That would represent a decrease of 3.1 percent from last year’s total, which in turn marked a worrying decline for an industry that was used to steady, impressive growth until not long ago.

    That essentially stopped when manufacturers got into a rut, failing to innovate like before and convince people to upgrade from their awesome high-end handsets to eerily similar and only slightly awesomer new flagships. With the advent of 5G connectivity and increasingly bolder designs pursuing the foldable and bezelless dreams, analysts are now widely expecting a (slow) recovery of global smartphone sales.

    But if Canalys is right, we may have to wait until 2020 for a boost in shipments. Specifically, this year’s 1.35 billion units are projected to rise to 1.39 billion for a sequential growth of 3.4 percent after consecutive declines of 4.5 and 3.1 percent in 2018 and 2019 respectively.

    Of course, this year’s total is exceptionally volatile and tricky to forecast, greatly depending on whether or not Huawei will ultimately be allowed to continue doing business with US companies. The current assumption is that “restrictions will be imposed stringently” on the Chinese vendor at the end of Trump’s 90-day reprieve, hampering its overseas potential for “some time.”

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  • Raffles City Hangzhou conferred World Gold Winner of Retail Category at 2019 FIABCI World Prix d’Excellence Awards

    Raffles City Hangzhou conferred World Gold Winner of Retail Category at 2019 FIABCI World Prix d’Excellence Awards

    Raffles City Hangzhou, CapitaLand’s largest operational Raffles City development, has been named the World Gold Winner in the Retail Category at the prestigious 2019 FIABCI World Prix d’Excellence Awards held in Moscow, Russia on 30 May 2019. This follows the footsteps of ION Orchard in Singapore and Raffles City Chengdu in China, which won in the same Retail Category in 2013 and 2015 respectively. Raffles City Hangzhou is the only commercial development from China feted at this year’s Awards.

    The annual FIABCI Awards, dubbed the Oscars of real estate, recognise projects that exemplify excellence in all the disciplines of real estate, such as best practices in sustainability and positive contributions made to the community. It is considered one of the most reliable indicators of a development’s worth and its impact on the future of commercial real estate. Mr Lucas Loh, President & CEO of China, CapitaLand Group, said: “We are honoured that Raffles City Hangzhou has received the highest accolade in the Retail Category at the 2019 FIABCI World Prix d’Excellence Awards, which celebrates the crème de la crème of real estate projects around the globe. This is the second Raffles City development in China after Raffles City Chengdu to clinch the prestigious award, underscoring the high and consistent quality of our signature Raffles City portfolio.”

    “CapitaLand is continually pushing the boundaries of urban development with smart, sustainable and human-centric designs that add value to the communities it operates in. With Raffles City Hangzhou, we set out to create a landmark development in the new city centre that will serve as the heart of civic and commercial activities. We are heartened that Raffles
    City Hangzhou has not only achieved commercial success since its opening, it has received recognition from global industry experts. As CapitaLand marks 25 years in China this year, we remain firmly committed to meeting the changing needs and aspirations of Chinese consumers as the country enters new stages of urbanisation and urban renewal.”

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  • Online fashion retailer Mogu reports Steep Growth Numbers

    Online fashion retailer Mogu reports Steep Growth Numbers

    Chinese online fashion and lifestyle retailer Mogu has reported an 18.7 per cent increase in gross merchandise value (GMV) for the year to March 31, to RMB17.408 billion (US$2.594 billion).

    The company’s revenue for the year reached RMB1.074 billion (US$160.1 million), an increase of 10.4 per cent year on year.

    However the number of active buyers in the year to March remained the same as the previous year, at 32.8 million.

    The company said it live-video broadcast business continued to grow strongly with associated GMV increasing 138.1 per cent year on year.

    “We delivered another quarter of solid growth,” said Qi Chen, Mogu’s chairman and CEO. “During the past quarter, we continued to expand, optimise and elevate the supply chain for our fashion ecosystem by enriching content, increasing user engagement on our live-video broadcasts, and facilitating more repeat repurchases,” he said.

    “Looking ahead, we will continue to strengthen our unique three-way fashion ecosystem by further growing our content creation community of fashion key opinion leaders and live-video broadcast hosts, elevating the fashion-product supply chain and supporting deeper collaboration between merchants and KOLs, and ultimately facilitating greater user and community engagement through rich and high-quality interactive fashion content and products.”

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  • Aldi China Opened in Shanghai Last June 7th

    Aldi China Opened in Shanghai Last June 7th

    Aldi will launch in China a week from now opening the first of 11 stores initially planned for Shanghai. But the Aldi China store format will be considerably different to the German discount grocer’s shops in the other 11 offshore markets it has entered: sources in Germany report the stores will have a more upmarket feel, stocking cosmetics and a broader range of dairy products.

    The stores will carry the signature brand positioning line “Everyday value – hand picked for you”.

    The location of the first two stores are in “noticeably prosperous neighbourhoods,” reports Lebensmittel Zeitung.

    The first Aldi China store opens on Friday June 7, and has been described by Aldi insiders as “more modern than company stores in Europe”. They will stock shelf-stable goods imported from Europe and Australia and fresh produce sourced locally.

    Nick Miles, head of Asia-Pacific at IGD, said that while Aldi Sud (South) has been testing the Chinese market for some time, having launched on Alibaba’s Tmall Global platform in April 2017, China will be “a new challenge” for the discount retailer.

    “Aldi currently operates stores in Europe, Australia and North America. Trading in Asia, and particularly China, will be very different. Many international retailers have entered this market over the past 20 years and not succeeded, while discount is a grocery channel that doesn’t currently exist in China – or Asia – in any meaningful way. Discounter Dia sold its business in China in April last year, while Lidl has recently pulled back from selling products via online platforms in the market,” said Miles.

    Lebensmittel Zeitung reports that Aldi South has been working on a plan to enter China through its thriving Australian subsidiary. “The growing business contacts between these two countries mean that the no-frills retailer can also draw on Australian suppliers with considerable experience in exporting to China.”

    Miles, meanwhile, predicts a significant challenge for Aldi will be overcoming potential resistance to its own-label lines.

    “Brands are king in China, while Aldi relies heavily on its private-label ranges.”

    Another challenge is that online grocery retailing and digital technology in retail are “exploding in the market” while Aldi’s business model has traditionally been through physical stores.

    “Aldi will be aware of all these challenges and more but plans to position its stores so that they appeal to China’s rapidly growing middle class and their desire for high-quality, imported products. It has ambitions to open 50-100 stores in the medium term and will be aware to not spread its operations too wide – a mistake other retailers have made in the past.”

    Choosing Shanghai to launch Aldi China makes sense because of the city’s population of more than 30 million, the sophisticated supply-chain infrastructure in the city and the local population’s relatively higher level of income compared with other Chinese cities. It is also a major global logistics hub.

    Meanwhile, IGD forecasts China to overtake the US and become the world’s largest grocery market by 2023.

    “The opportunity for Aldi to be present in the market is therefore clearly significant, but it will not come without its risks,” added Miles.

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  • Song Fa Bak Kut Teh Restaurant Chain to enter Taiwan

    Song Fa Bak Kut Teh Restaurant Chain to enter Taiwan

    Food Republic Taiwan is to open Song Fa Bak Kut Teh restaurants in Taiwan.

    The BreadTalk subsidiary has entered a franchise deal with Song Fa Holdings to develop and operate the Teochew pork-rib stew brand in Taiwan for the next 10 years.

    The first two outlets in Taiwan will be opened in popular Taipei malls.

    “Both malls have strong existing tenants and are household names among the local populace and tourists alike,” said Henry Chu, BreadTalk CEO.

    “With the addition of a star attraction like Song Fa Bak Kut Teh, we are confident to deliver the illustrious Song Fa experience to our customers in Taiwan.”

    Founded in 1969, Song Fa Bak Kut Teh has 10 outlets in Singapore, seven in Indonesia, six in China, and one in Thailand.

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  • Tesla Promotes Lower Priced China-Made Model 3

    Tesla Promotes Lower Priced China-Made Model 3

    U.S. electric vehicle (EV) maker Tesla Inc said on Friday it would price its China-made Model 3 vehicles from 328,000 yuan ($47,529), 13% cheaper than those it currently imports as it pushes sales in the fast-growing market.

    The carmaker has been building a factory in China since January where its initial output will be Model 3 cars. Pre-orders for the vehicles will also start on Friday, the company said on its website.

    The “standard range plus Model 3” is 49,000 yuan cheaper than China’s current cheapest version, also standard range plus, even though it remains unclear whether the carmaker will qualify for China’s subsidies for new energy vehicles.

    The starting prices for five different versions of China-made Model 3s range from 328,000 to 522,000 yuan. Customers can expect to receive the car in 6-10 months, the company said in a press release.

    It also said buyers will only need to put down a deposit of 20,000 yuan and that financing options on offer meant that monthly payment installments will start from 1,100 yuan.

    “The price drop is to make Tesla more accessible,” it said.

    The higher-end version of the Model 3 will still be imported from the United States.

    Investors are focused on whether the gross profit margin on the Model 3 will remain around 20% in China.

    Doubts about the Model 3’s production rate and sales performance have hit Tesla’s share price in recent months.

    Producing cars locally is likely to help Tesla minimize the impact of Sino-U.S. tit-for-tat import tariffs, which has forced the EV maker to adjust the prices of its U.S.-made cars in China.

    Keeping prices in check will also help Tesla fend off competition from a swathe of domestic EV startups such as Nio Inc, Weltmeister and XPeng Motors, as well as established carmakers including Volkswagen AG and General Motors Co.

    Tesla’s so-called Gigafactory is China’s first wholly foreign-owned car plant and is seen as a reflection of the country’s broader shift to open up its car market.

    Pictures of the Shanghai plant posted on Tesla’s social-media account showed the construction of its main section was nearly done. The company also held a recruitment event this week for car manufacturing and logistics workers.

    Tesla forecast its deliveries in 2019 would reach 360,000 to 400,000 vehicles and said it may produce as many as 500,000 vehicles if its China factory reaches volume production in the fourth quarter.

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  • DHL Starting drone deliveries in China

    DHL Starting drone deliveries in China

    DHL China is to start delivering goods by drones, cutting the delivery time on a route in Guangzhou from 40 minutes to just eight.

    The international express delivery-service provider has entered into a strategic partnership with autonomous aerial-vehicle firm Ehang to jointly launch a fully automated smart drone-delivery solution to tackle last-mile delivery challenges in Chinese urban areas.

    Using the most advanced Unmanned Aerial Vehicle (UAV) in Ehang’s newly-launched Falcon series, the new intelligent drone delivery solution overcomes the complex road conditions and traffic congestion common to urban areas. It reduces one-way delivery time from 40 minutes to eight minutes and can save costs of up to 80 per cent per delivery, with reduced energy consumption and carbon footprint compared with road transportation.

    “We are delighted to be partnering with Ehang to set a new innovation milestone with this new fully-automated and intelligent drone logistics solution,” said DHL Express China CEO Wu Dongming, “which combines the strength of the world’s largest international express company together with one of the leading UAV companies in the world. This is an exciting time for the logistics sector, with continued growth of the Chinese economy and cross-border trade, particularly in South China and the Greater Bay Area, which is home to an increasing number of SMEs and startups. This means there is a tremendous volume of logistics needs, which in turn creates new opportunities for implementing innovative solutions that can continuously drive growth with greater efficiency, sustainability and lower cost.”

    The new customised route, which has been exclusively created for a DHL customer, covers a distance of approximately 8km between the customer premises and the DHL service center in Liaobu, Dongguan, Guangdong Province.

    “Together with DHL we are very glad to bring the first smart drone delivery service route to China in Guangzhou; this marks a new beginning in building air logistics for smart cities,” said founder & CEO of Ehang Hu Huazhi. “Riding on today’s launch, we expect smart drone delivery as an innovative logistics solution to be expanded and realised in more areas, and we look forward to working with DHL in building the eco-system for a multi-dimensional urban air transport system.”

    The EHang Falcon smart drone, with eight propellers on four arms, is designed with multiple redundant systems for full backup, and smart and secure flight control modules. Its high performance features include vertical take-off and landing, high accuracy GPS and visual identification, smart flight path planning, fully-automated flight and real-time network connection and scheduling. As a fully-automated and intelligent solution, the drones, which can carry up to 5 kg of cargo per flight, take off and land atop intelligent cabinets that were specifically developed for the fully autonomous loading and offloading of the shipment. The intelligent cabinets seamlessly connect with automated processes including sorting, scanning and storage of express mail, and will feature high-tech functions such as facial recognition and ID scanning.

    This smart drone delivery solution will enhance DHL’s delivery capabilities and create a new customer experience in the logistics sector that opens up even more opportunities for sustainable growth and greater economic contribution. Given the growing prominence of B2C business operations and delivery in China, employing drones in express delivery services offers an innovative solution for meeting the increasing demands for time-sensitive delivery, particularly for last mile delivery in urban areas.

    Building on the launch of its first fully automated, intelligent drone delivery solution in China, DHL will continue to identify new routes that can be developed for clients in need of tailored customer services and logistics solutions and will work closely with EHang to create a second generation of drones in the near future that will further improve capacity and range in drone-operated express delivery.

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  • Starbucks China Reshuffles Management

    Starbucks China Reshuffles Management

    Starbucks China management has been restructured as the company gears up for a more intense focus on its digital business. From June 1, CEO Belinda Wong, becomes chairman and CEO of Starbucks China.

    Two distinct business units will be created – Starbucks Retail and Digital Ventures – the heads of which will report directly to the newly created office of the chairman and CEO, Starbucks China.

    Leo Tsoi has been appointed SVP, COO & president of Starbucks Retail and Molly Liu has been appointed VP & GM of Digital Ventures.

    Wong will oversee new business development in China and focus on long-term sustainable growth.

    “The new team structure is for the next phase of growth and managing resources to balance the short-term needs of the business and the long-term strategic priorities in China,” said Starbucks group president, international, channel development and global coffee and tea, John Culver.

    “While paying more attention to customers and partners, we will accelerate the pace of innovation to capture the new opportunities in the third-place experience and digital innovation,” he said.

    Wong has headed the China business since 2011 and under her leadership, the company has grown at a rate faster than any other of the brand’s global markets. Among her achievements were setting up the New Retail partnership with Alibaba, integrating the East China business in 2017 and creating the “Coffee Wonderland” experience with the Starbucks Reserve Roastery in Shanghai.

    After 20 years in China, the company has grown to 3800 stores in 165 cities, serving 9 million customers every week.

    “For 20 years, we have worked steadily to achieve a long-term and healthy development in China,” said Wong. “For the next chapter of growth, we will stay true to our mission, values and guiding principles. About 53,000 Starbucks partners in China will work together to continue our innovation ventures and bring our passion of coffee to our customers to enhance the third-place experience.

    “We will also support our partners in their professional development to realise their full potential and give back to the community where we live in. ‘In China, for China’, we will continue to fulfill our commitment in developing a long-term and healthy development in China, making Starbucks as a faster, stronger and more loving company,” she said.

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