Retailer Temu’s daily US users halve following end of ‘de minimis’ loophole

Written by Casey Hall, Ariana McLor

Shanghai/New York (Reuters)-Users in the United States continue from the global e-commerce platform at PDD Holdings by 58 % in May, according to the market Intelligence Sensors, one of the many opposite winds faced by e-electronic amid a trade war for the United States.

TEMU decided to reduce advertising spending in the United States and transfer the demand strategy after the White House ended on May 2, known as “De Minimis”-which allowed Chinese companies to charge low-value packages to the United States free from customs tariffs.

TEMU, along with the fast fashion giant, used this for years to drop the elements directly from suppliers in China to consumers in the United States, making prices low.

Temu and Shein have suffered from a sharp decrease in sales growth and customer growth rates since US president Donald Trump announced a comprehensive trade tariff, according to the data gathered by Bain & Company, but TEMU trends were worse than its competitor.

The customs duties forced both platforms to raise prices, but Shin managed to increase the amount of money that is spent for each customer compared to a year ago, while I struggled with TEMU.

TEMU did not respond to a comment on Drop in Us Daily users or the opposite winds he faces in the American market.

Simon Gutman, Morgan Stanley’s stock analyst, said in May that participating in Timo had decreased dramatically after the end of the exemption.

“While the tariff environment is unconfirmed, if the current situation remains for a long time, we believe that Timo’s competitive threat will continue to be weak,” said Gutman.

Last week, the profits of the first quarter of PDD decreased to growth estimates and the executive managers informed the post -profit invitation that the customs tariff had created great pressure for its traders.

They repeated the previous TEMU pledge to maintain stable prices and work with merchants across the regions, in reference to the shift to the local loyalty model that was announced at the beginning of May.

TEMU’s previous business model granted merchants responsible for requesting and providing their products while China -based company has managed most logistical services, pricing and marketing.

Now, TEMU traders can “charge individual orders from China to American TEMU Circassian warehouses, but they will need to process customs duties, customs fees and paper works,” according to a memorandum of analysts in HSBC. TEMU continues to deal with clear requests near shoppers, and to determine prices and online operations.

In the memorandum last week, HSBC said that the growth of TEMU in non -American markets has risen, as non -United States users rose to 90 % of its 405 million monthly users in the second quarter.