Report: China’s Largest Coffee Chain Luckin Prepping US Launch

“Luckin Coffee” by chooyutshing is licensed under CC BY 2.0.

Chinese coffee giant Luckin Coffee is planning a small-scale launch in the United States, less than four years after the company agreed to a $180 million settlement with the Securities and Exchange Commission (SEC) over fraud charges.

The Financial Times first reported the Xiamen-based company’s ambitions for the U.S. market. Citing “two people with knowledge of the matter,” the Financial Times reported that the company is eyeing a U.S. launch as early as next year, with eyes on cities with “large numbers of Chinese students and tourists such as New York.”

The report further states that Luckin Coffee plans to “undercut U.S. incumbents by selling drinks priced around $2 or $3.”

Luckin Coffee declined comment to the Financial Times inquiry, according to the report. The company did not immediately reply to DCN’s request for comment.

Convenience and affordability have been central to Luckin Coffee’s pitch since its founding in 2018. With small-scale stores and kiosk formats combined with a focus on mobile ordering and automation, the company experienced a meteoric rise in its home country, opening more than 4,000 stores within its first two years.

As of 2023, Luckin was opening an estimated 16.5 stores per day in China, and it is now China’s largest coffee chain by a wide margin, followed by another relatively new chain, Cotti Coffee, and Starbucks. In July, Luckin Coffee said it had reached 20,000 stores.

Luckin Coffee was originally listed on the Nasdaq exchange in 2019, then was de-listed in 2020 following SEC claims that company leaders fabricated more than $300 million in sales to appease investors. Two former Luckin executives, Charles Lu and Jenny Qian, subsequently went on to create what is now Luckin’s largest domestic competing chain, Cotti Coffee.

The Financial Times report comes just one day ahead of Luckin Coffee’s planned third quarter earnings call.

Luckin Coffee recently opened the largest coffee roasting factory in China. The company also recently signaled a trade agreement with the world’s largest coffee-producing country, Brazil, worth approximately $500 million.

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