Nike spent forty years teaching Chinese consumers how to buy overpriced sneakers. Starbucks spent twenty years teaching them how to overpay for burnt coffee. GM spent decades teaching them that cars should break down in interesting ways. The students have graduated. They no longer need the teachers.
Domestic brands now make the same sh*t for half the price. Turns out that was the entire value proposition. Nobody in Shanghai gives a f*ck about Michael Jordan's legacy when they can buy identical foam for sixty yuan. The swoosh doesn't hit the same when your government is in a trade war with the company that owns it.
Starbucks lost ground to a chain called Luckin Coffee, which somehow survived an accounting fraud scandal and came back stronger. That's the level of competition we're discussing. A company that literally got caught lying about its numbers still makes a better latte than Howard Schultz's fever dream of Italian cafe culture translated through Seattle and shipped to Beijing.
GM's problem is even simpler. Chinese EV companies build electric cars that don't look like appliances designed by committee. They also cost less than a Chevy Bolt, which is an impressive achievement considering the Bolt already looked like GM gave up halfway through the design process.
Every retail trader who bought these stocks because "China growth story" is now learning that growth works both ways. The local brands grew. The American brands shrunk. Geopolitics did whatever geopolitics does. Consumer preferences changed, which is finance-speak for people stopped buying your garbage.
Nike still has the Chinese factory. They just lost the Chinese customer.
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