Temu Shifts to Local Fulfillment in U.S. Following End of Tariff Exemption

Temu, the Chinese e-commerce platform owned by PDD Holdings Inc., has announced a significant change in its U.S. operations. Effective immediately, the company has halted direct shipments from China to U.S. customers. This decision comes in response to the U.S. government's termination of the "de minimis" tariff exemption, which previously allowed low-value shipments from China to enter the U.S. duty-free.

The "de minimis" exemption, established in 1938 and raised to an $800 threshold in 2015, enabled platforms like Temu and Shein to offer inexpensive products to U.S. consumers without import duties. However, as of May 2, 2025, the Trump administration has removed this exemption, imposing a 120% tariff or a flat fee on such shipments, which is set to increase to $200 by June 1 .The US SunThe Guardian

In response, Temu has shifted its business model to focus on selling goods from local U.S. merchants. All U.S. orders will now be fulfilled from within the country, with products from China marked as "out of stock." The company has also begun recruiting U.S.-based sellers to join its platform, aiming to maintain its market presence and continue offering competitive prices to consumers.

This strategic pivot is seen as a direct response to the new trade policies, which are part of a broader effort to address concerns about unfair competition from Chinese e-commerce firms and to curb the influx of illicit goods. While the immediate impact on consumers may include price adjustments and potential delays, Temu's move to local fulfillment aims to mitigate these effects and align with the new regulatory landscape.

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