Chinese companies try to fool consumers in the West
Changing a firm’s name, moving headquarters and buying global brand names are just part of the strategy
Chinese companies are desperate to disguise their country of origin in a bid to confuse global consumers. With tension rising between Beijing and Washington, these brand names have used various methods to airbrush their image.
Made in China is no longer an option. Nor are links to the world’s second-largest economy or the shadowy Communist Party.
But that has not stopped them from flooding into the United States and Europe. In 2021, the online fast fashion label Shein underwent a makeover. Now, it is looking at a possible US$60 billion IPO in New York.
“Shein relocated its [HQ] to Singapore [two years ago]. In April, it deregistered its original parent company in Nanjing. E-commerce platform Temu has been headquartered in Boston since its launch last September,” The Wire China, a digital news magazine, reported on Sunday.
“[Temu’s] parent company PDD Holdings moved its headquarters to Ireland in the first quarter of this year, according to its SEC filings,” it said.
Being [seen as] a Chinese company … comes with risks.
Scott Kennedy, of the Center for Strategic and International Studies
Made in China:
- Cryptocurrency exchange Binance, social media sensation TikTok and e-commerce platform Pinduoduo have all been transformed.
- Pinduoduo has morphed into the more Western-sounding PDD Holdings and operates out of Dublin.
- Shanghai Automotive or SAIC simply bought the British marque sports car MG and marketed its 90-year history.
Between the lines: “[Sill,] rarely have companies moved abroad to rebrand their national identity. Such maneuvers complicate the question of what makes a firm Chinese, posing potential issues for their customers, suppliers, and investors,” The Wire China reported.
Big picture: Along with allies in Asia and Europe, the US is locked in an economic and military standoff with China.
Delve deeper: It includes trade, high-tech, Beijing’s bullying in the South China Sea and threats to Taiwan, as well as its tacit support for Russia’s illegal invasion of Taiwan.
Why it matters: “Being [seen as] a Chinese company is potentially bad for doing global business and comes with risks. It may affect your image around the world,” Scott Kennedy, of the Center for Strategic and International Studies, told CNN online.
China Factor comment: Economic stagnation at home is forcing Chinese companies to reinvent themselves as they muscle into foreign markets. But the long shadow of the ruling Communist Party is never far behind. Global consumers beware.