Shopping habits in the U.S. are changing, with convenience and low prices driving millions to new platforms.
Temu, a Chinese e-commerce app, has become a favorite among American consumers, offering a vast array of inexpensive goods.
But its rapid success comes with challenges, as the company faces increasing scrutiny from regulators.
For the second year running, Temu topped the Apple Store’s list of most downloaded free apps in the U.S., beating heavyweights like TikTok and Amazon, according to Hotnews.
Loopholes Might be Closed
Its rise is attributed to competitive pricing and a reliance on the U.S. “de minimis” rule, which allows goods valued under $800 to enter duty-free.
While this policy cuts red tape, it’s also been criticized for enabling tax loopholes and illegal activity, such as the trafficking of restricted substances.
Washington is paying attention. The Biden administration has proposed closing these loopholes to prevent exploitation by foreign companies.
If enacted, such changes could dramatically impact Temu and others like it, raising costs and making them less appealing to budget-conscious shoppers.
Donald Trump’s impending return to the presidency could add to the uncertainty. During his campaign, Trump promised to impose steep tariffs — up to 100% — on Chinese imports.
While his exact policies remain to be seen, the rhetoric signals tough times ahead for Chinese exporters.
Temu is not alone in this fight. Shein, the fast-fashion giant, has also grown reliant on the de minimis rule.
Both companies are navigating a growing backlash not only in the U.S. but also in Europe, where regulators are taking a closer look at online imports.
The European Union is considering removing its own duty exemption for goods under €150.
The challenges extend beyond the West. Vietnam recently banned Temu, reflecting Southeast Asia’s growing concerns about market disruptions caused by Chinese platforms.
