Temu Pushes US Made Products Following Trump's Reversal of Trade Loophole

temu-pushes-us-made-products-following-trump's-reversal-of-trade-loophole

By Madelaine Panganiban

Updated: Feb 07 2025, 01:40 AM EST

Temu Pushes US Made Products Following Trump’s Reversal of Trade — In this photo illustration, the apps for Chinese-owned companies Shein and Temu are displayed on a smartphone on February 04, 2025 in San Anselmo, California. Justin Sullivan/Getty Images/Getty Images

Temu, the Chinese-owned e-commerce platform, has shifted its focus to promoting more "local" products after a significant change in US trade policies.

On Thursday, the site featured items marked with a green "local" badge, indicating they are stored in US warehouses.

This strategic move comes after President Donald Trump eliminated the de minimis exemption, a rule that allowed Chinese sellers to ship goods valued under $800 to the US without paying taxes, NY Post said.

The change now means Temu and other similar companies face increased costs and potential delays due to new tariffs.

The removal of the de minimis rule has affected the business model of companies like Temu and Shein, who previously enjoyed a massive advantage by shipping products directly from China to US customers at low prices.

Temu Cuts Shipping Delays with Focus on US Warehouse Products

Now, Temu is adjusting by prioritizing products stored in US warehouses to avoid the new tariffs and reduce shipping delays.

This shift also allows the company to compete more directly with US giants like Amazon, eBay, and Walmart.

Despite the "local" badge, many of these products are still sold by businesses based in China. However, with inventory now being stored in US warehouses, these products can be shipped faster and bypass the additional costs tied to the new tariffs.

This shift aligns with Temu's goal to maintain its competitive pricing while adjusting to the changing trade environment.

The company's decision also comes as part of a broader strategy to reduce its reliance on Chinese sellers shipping directly to US customers.

According to NBC NewYork, by March 2024, about 20% of Temu's US sales were from sellers with US warehouse inventory. Shein has made similar moves, establishing distribution centers in several US states.

However, the new tariffs and trade restrictions have not been the only hurdles for Temu. A recent US Postal Service ban on packages from China and Hong Kong, followed by a quick reversal, added further uncertainty to the situation.