July 5, 2010 | By ChinaRetailNews.com Editor – The international fast food giant McDonald’s has set up a strategic partnership with Shenzhen Metro Company for its expansion in business areas along subway lines.

This is reportedly the first time for McDonald’s to form an alliance with a local metro transit company in China.

According to the agreement signed by the two parties, during the next five years, the American fast food company has the priority to open restaurants in all underground and above-ground real estate projects operated by Shenzhen Metro. Apart from the rent gained from the agreement, Shenzhen Metro can also take the opportunity to develop the fast food business in its subway stations since there is no fast food restaurant in these stations.

Prior to this, McDonald’s announced that it plans to increase its investment in China by 25% and its operating revenue is expected to be triple by 2015, comparing with that in 2009. – read more at ChinaRetailNews.com…

ZTE Corporation, based in Shenzhen, is currently the eighth-ranked handset maker in the world, according to the Gartner Group.

By Zhu Shenshen (Shanghai Daily) – THREE Chinese firms, two in the mainland and one from Hong Kong, have been listed in the world’s top 10 handset makers, thanks to the growing market demand in Asia, a United States-based research firm said today.

By the end of the first quarter, Shenzhen-based ZTE Corp ranked No. 8, followed by Hong Kong-based G-Five with the No. 9 position, which ranked in the top 10 for the first time. Shenzhen-based firm Huawei Technologies ranked No. 10, according to Gartner Inc, a US-based IT research firm.

The combined market shares of the top five mobile handset manufacturers, including Nokia, Samsung, LG, RIM (Research in Motion) and Sony Ericsson, dropped from 73.3 percent in the first quarter of 2009 to 70.7 percent in the same period this year, according to Gartner.

ZTE, which expects mobile phone revenue to grow 35 percent annually in 2010, grabbed a 1.7 percent share of the global market, up 0.4 percent from last year.

China’s mobile subscriber base will reach 840 million units by 2010 and more than 1 billion in 2012, according to Informa, a Switzerland-based research firm. — read more at ShanghaiDaily.com…

Starbucks VIA Ready Brew instant coffee is offered at a Starbucks coffee shop in Chicago, Illinois. Starbucks instant coffee is already available in the United States, Canada, the United Kingdom and Japan. (Scott Olson/For China Daily)

By YU TIANYU (China Daily) – BEIJING: Global coffee chain Starbucks Corp is planning to launch instant coffee products in China, a region it believes will be its largest market outside North America, surpassing Japan.

Wang Jinlong, chairman of Starbucks in China, told China Daily that the company is presently working on market surveys and customer preferences for such products.

Starbucks Chief Executive Officer Howard Schultz said the company expects to sell more than $1 billion of its instant coffee, called Via Coffee Essence, worldwide after it started offering the powdered mix in Japan, the world’s biggest market for instant coffee since early this month.

The product is already available in the United States, Canada and the United Kingdom.

“During the last five decades, there have been very few new products, but great progress has been made in the world’s instant coffee market,” Wang said.

“Starbucks has taken over 20 years to revolutionize its offerings and we are offering high-quality instant coffee that customers can enjoy anytime and anywhere,” he added.

Instant coffee accounts for just 2 to 3 percent of coffee consumption in the US, he said. But, the company is convinced of the huge potential in China and expects to launch the products soon.

According to market research firm Euromonitor International, coffee sales in China could reach $3.6 billion by 2011 from $2.4 billion in 2006.

Instant coffee currently makes up the biggest chunk of China’s coffee industry with Nestle’s Nescaf and Kraft’s Maxwell House the major players in the market.

Starbucks operates more than 16,000 outlets in over 50 countries. Since entering the mainland in 1999, it has 376 outlets in 26 cities, mainly in coastal regions.

Wang said the company would focus more on inland cities in the future.

The company expects second- and third-tier cities to become significant markets after its expansion.

It has opened 14 outlets in Chengdu and 10 outlets in Chongqing.

Meanwhile, the company will look to further expand its presence in first-tier cities like Beijing, Shanghai and Shenzhen. — read more at ChinaDaily.com…

McDonald's and its competitor KFC in Shenzhen

McDonald’s Corp, the world’s largest hamburger chain, said it expects to boost its capital investment in China by about a quarter this year to tap the growth of the world’s third-largest economy.

“We expect to increase our capital investment by 25 percent over last year,” said Kenneth Chan, McDonald’s China CEO, during the launch of a new marketing campaign on Friday.

“We continue to be extremely bullish about our business in China and will continue to invest in opening new restaurants,” Chan said, but declined to disclose the investment amount for 2009 or 2010.

McDonald’s, which competes with Yum Brands’ KFC in the US and China, was planning to open 150 to 175 restaurants in China in 2010, which would lead to the creation of 10,000 new jobs, he added.

The company said it had 1,135 stores in Chinese mainland as of the end of 2009.

McDonald’s is launching a new brand concept called “Make Room for Happiness” to mark the 20th anniversary of the opening of its first restaurant in Shenzhen. – read more at ChinaDaily.com…

A JR Tokai Maglev train

JR Tokai targets 7 U.S. areas to promote bullet, maglev train systems: Central Japan Railway Co. said Monday it has selected seven U.S. areas in which it will concentrate its marketing efforts for its ”shinkansen” bullet train and maglev train systems. For shinkansen systems, the Japanese railway operator, known as JR Tokai, said it has picked four areas spearheaded by a possible route linking Tampa, Orlando and Miami in Florida. (Via Kyodo News (Business).)

Bain to buy Japan Domino’s operator Higa: Bain Capital LLC said it will buy Higa Industries Co., which operates Domino’s Pizza stores in Japan. The Boston-based private equity firm will buy the company from Duskin Co., Daiwa SMBC Capital Co. and founder Ernest Higa. The transaction will take place Feb. 1, Bain said in a statement Monday without providing a purchase price. (Via The Japan Times: News & Business.)

UPS plans new Shenzhen air hub: A planned air hub for logistics giant UPS in Shenzhen is expected to intensify competition in international express service among the big players in China. Sources from Shenzhen Airport (Group) Co Ltd said the hub is expected to be operational February 9, and will see 14 round-trip cargo flights between nine countries and regions in its first stage, the National Business Daily reported Saturday. (Via Business – People’s Daily Online.)

China Automotive Systems To Supply Chrysler North America: Wuhan-based China Automotive Systems, a power steering components and systems supplier in China, has announced that its first global OEM customer is the Chrysler Group LLC, which is headquartered in North America. In November 2008, CAAS received its first order from Chrysler to export power steering gears to Chrysler’s North America assembly facility. (Via China Sourcing News.)

Hundreds queue for Dodgers tickets: (ChinaPost.com.tw) – Hundreds of loyal fans queued up yesterday in Taipei and Kaohsiung to purchase the tickets to the exhibition games between the LA Dodgers and Taiwan’s baseball league following the Major League team’s official announcement on Jan. 23. (Via China Post Online – Taiwan , News.)

The GEB board is to be officially launched today at the Shenzhen Stock Exchange. (Jiang Ning)

Zhou Yan (China Daily) – CITIC Securities Co, the largest listed domestic brokerage, and its subsidiary have topped the list of brokers earning underwriting fees for the first batch of stock listings on the NASDAQ-style growth enterprises board (GEB), which is to be officially launched today.

CITIC, together with CITIC China Securities, in which the former holds a 60-percent stake, have earned underwriting fees worth 188.97 million yuan in three initial public offerings (IPOs).

The two brokers’ combined underwriting commission accounted for 26.3 percent of the total made by all the 23 domestic broker participants, with Beijing Ultrapower’s 166.97 million yuan underwriting fee earned by CITIC Securities ranked at the top.

The brokerage firm and its subsidiary have underwritten issues for software developer Beijing Ultrapower, Shenyang-based SIASUN Robot & Automation, and filmmaker Huayi Brothers.

The first batch of 28 companies, which are to be listed on the GEB based in Shenzhen on Oct 30, have raised around 15.5 billion yuan ($2.27 billion) in their IPOs, according to Yao Gang, vice-chairman of the China Securities Regulatory Commission.

“Large brokerage firms like CITIC Securities have more star underwriters with extensive expertise and good reputation. Therefore, their smaller peers find it hard to compete with them in bargaining with IPO firms,” said Liu Zhiteng, an investment manager at investment consulting firm Blue Ocean Capital.

According to figures compiled by 21st Century Business Herald, the average underwriting commission rate for the 28 cases was 4.83 percent, higher than the small- and medium-sized board’s 3 percent and 2 percent on Shanghai’s main board. CITIC Securities’ underwriting fee for Beijing Ultrapower was 6.6 percent.

Changjiang Securities estimated that 50 firms were likely to be listed on the new board, raising a combined 22.5 billion yuan within the year, which will generate 1.58 billion yuan worth of underwriting fees for securities firms. read more…