Hours after a key US tariff exemption expired, Chinese e-commerce platform Temu announced a significant shift in its shipping strategy, opting to route all American sales through US-based sellers. According to a statement from Temu, all sales in the U.S. are now managed by local sellers, with orders fulfilled domestically. This move marks a departure from the previous reliance on the de minimis exemption, which allowed goods valued at $800 or less to enter the US duty-free.

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Temu, alongside other Chinese e-commerce giants like Shein and AliExpress, had capitalized on this loophole to deliver ultra-low-cost goods to American consumers. However, the expiration of this exemption, coupled with tariffs imposed by former President Donald Trump on Chinese imports, has driven Temu to adapt its business model. By leveraging US-based warehouses, Temu aims to maintain its competitive pricing while circumventing the new tariff landscape.

Data from the IndexBox platform indicates that the de minimis exemption had been a significant factor in the proliferation of Chinese goods in the US market. Despite the shift in shipping practices, Temu’s products remain predominantly manufactured in China, raising questions about the long-term sustainability of this strategy. The company faces challenges such as potential shortages and the need to adjust pricing strategies to accommodate new operational costs.

On social media, users have reported stock shortages and additional fees for items not sourced locally, indicating a transitional period for the platform. As Temu navigates these changes, the broader implications for the e-commerce landscape and US-China trade relations remain to be seen.

Source: IndexBox Market Intelligence Platform