China’s Luckin Coffee is Brewing Competition in New York City

Coffee enthusiasts lined up around the block in the run up to the Chinese chain’s New York City launch. (Credit: Tiffany Wang)

At the end of June, there was a new coffee shop on the block. China’s top coffee chain Luckin Coffee toured different New York City hotspots with a series of coffee truck pop-ups, warming up coffee-loving customers for the openings of its first two U.S. stores.

On the second day of the promotion, the line for Luckin’s free coffee stretched two blocks long in 90-degree weather in Soho.

“I actually really like it,” summer student intern Paige Yu said after her first sip of Luckin’s matcha coconut latte. “I tend to like sweeter drinks, so the coconut is a great addition.”

Luckin and other Chinese beverage brands’ expansion into the U.S. will spark new competition and opportunities in a saturated market of Asian and domestic beverage makers and a fervent pool of consumers.

According to the National Coffee Association, two-thirds of Americans drink multiple cups of coffee every day.

More importantly, the NCA reported that “consumption of specialty coffee has increased by nearly 18%” from 2020 to 2025, indicating good prospects for Luckin’s specialty drinks like pineapple cold brew and velvet latte.

Stylish tea brands that are popular in China are popping up all over New York: HEYTEA opened 14 locations in a year; Naisnow and LELECHA have plastered their new storefronts with signage.

But there are few Chinese coffee brands like Luckin.

Luckin Coffee has more than 24,000 stores in Asia as of the end of March, surpassing Starbucks’ 19,000 stores worldwide.

Luckin Coffee is known for its game plan of seizing the market with rapid expansion first and dealing with the debt later.

Luckin CEO Jinyi Guo acknowledged that they even “opened slightly more stores than initially planned” in the latest earnings call, “further cementing [their] leadership as China’s largest coffee chain brand by store count.”

Luckin’s marketing department said it is not currently responding to media requests.

The company’s annual report said that it grossed $4.7 billion in revenue in 2024, a nearly 40% increase from the previous year, thanks to rapid store and customer growth.

However, “decreasing customer spending, increasing competition, [and] declining growth of China’s coffee industry” prompted Luckin to seek new sources of revenue outside China, in Singapore, Malaysia and now the U.S.

“As part of our long-term development strategy, we are taking a disciplined approach to overseas expansion,” Guo said.

During its four days of pre-opening truck pop-ups, customers received a free cup of 16 oz coffee if they signed up for the store app, a $0.99 coupon for any drink, and a tote bag for tagging the store on social media.

There were also hidden phrases of encouragement in the cup sleeves, such as “You’re doing great, even if it feels not” and “Chase your dreams, and luck comes along,” that became sought-after souvenirs.

Hongbo Zhao, a University of Wisconsin–Madison student, has been a fervent Luckin customer. He said he found himself craving Luckin’s coffee three times a month when it was only available in Asia.

“They have some particular coffee that only Luckin has. For example, orange cold brew, pineapple cold brew, coconut cold brew kind of stuff,” Zhao said. “Compared with that, American coffee is kind of boring.”

News of the event spread on social media platforms like RedNote and Instagram, targeted at young people in New York, many of whom showed up at the hour-long lines.

Yu came across the pop-up on TikTok. “I’ve heard of a lot of good things about it, so I was interested to try it out,” she said.

“I’m Chinese and I’ve been to China a few times before and I saw this place all over the place in China,” Yu said, “so I thought it was really interesting that they were opening up a shop here.”

Instagram food blogger Emma Newhouse said the drinks looked really good. “And that was just like, ‘I need it’.”

Russell Winer, New York University professor emeritus of marketing, highlighted the company’s use of social media.

“It sounds like their target audience is going to be sort of late teens, early 20 somethings,” he said, adding that the Luckin’s social media strategy “might be effective against Starbucks, which has a broader target audience and somewhat older.”

The crowd was free advertising for Luckin Coffee in itself, attracting curious looks and gasps from passersby on the buzzing street:

“What is this coffee?” one passerby asked.

“This is so New York!” another said.

As Chinese consumers’ spending power staggers, with the country’s GDP lingering between $18 to $19 trillion since 2021, Chinese companies like Luckin and Miniso were born out of a need for cheap but cute products.

After Miniso successfully opened four locations in Manhattan, Luckin arrived in New York City with a similar business model.

“If the price can be economical, we will get Luckin Coffee in my daily routine,” Zhao said.

Although Luckin is offering a load of grand opening coupons, their drinks are typically priced around $6.45, which some customers at the pop-ups didn’t think was a bargain.

On top of that, Winer said Luckin’s two stores in Manhattan aren’t that many and “they’re gonna have to drive [consumers] to those two locations.”

And those locations are surrounded by Starbucks, budget chains like Dunkin’ and McDonald’s, and independent cafés.

Just around the corner from Luckin’s new home between West 27th and 28th Street on 6th Avenue sits a boutique café, Patent Coffee. The barista there was unfazed by the incoming rivalry.

“It’s a healthy competition because this is the best coffee shop in this neighborhood,” Lorenzo Rodriguez said.

Winer said he sees potential for Luckin in New York City, which is filled with young people with disposable income.

“ If they offer a good product, and they do an effective marketing job and make it seem young and hip and something cool, then there’s no reason they can’t be successful,” Winer said.