AP Business Writer May Anderson
NASHVILLE, Tenn. (AP) — China-based e-commerce websites Temu and Shein say they plan to raise prices for U.S. customers starting next week. This is a ripple effect from President Donald Trump’s attempt to correct the trade imbalance between the two largest economies of the world by imposing high tariffs on goods shipped from China.
Temu, owned by Chinese e-commerce company PDD Holdings, and currently based in Singapore, Shein, said in the same notice that operating costs have risen “due to recent changes in global trade regulations and tariffs.”
The companies said they would make a “price adjustment” from April 25th, but neither provided details on the scale of the increase. It was unclear why the two rivals posted almost identical statements on shopping sites.
Since launching in the US, Shein and Temu have been able to make money for Western retailers by offering products at ultra-low prices, coupled with an avalanche of digital or influencer ads.
145% tariff Trump, coupled with his decision to end customs exemptions, which allow items under $800 to enter US tax exemptions, slapsed on most products made in China, and dented the business model of the two platforms.
E-commerce companies are the largest users of widely used exemptions. Trump signed an executive order this month to eliminate “minimal provisions” for goods from China and Hong Kong, which will be subject to a 145% import tax from May 2nd.
The 4 million low-value plots occurring in China – arrive in the US every day under the soon-to-be cancellation regulations.
US politicians, law enforcement and business groups have lobbyed to remove long-standing exemptions, giving benefits to cheap Chinese products and explaining them as a trade loophole that serves as a portal for illegal drugs and counterfeit products to enter the country.
Shein sells cheap clothing, cosmetics and accessories, and targets young women primarily through partnerships with social media influencers. Temu, who promoted its products through online advertising, sells a wider range of products, including household items, humorous gifts and small electronics.
Last year, businesses were the biggest ad spenders on social media platforms, but both have cut their spending significantly in recent weeks, according to Sensor Tower, a data analytics provider. This could be bad news for platforms like Facebook, Instagram, Snap, X, Tiktok, and more that rely on ads.
In November, American E-Commerce Giant Amazon launched a low-cost online storefront featuring electronics, apparel and other products that cost under $20 and other products. Many of the electronics, apparel and other products in store on Wednesdays are similar to the types of items that are usually found in Shane and Tem.
With customer notifications about pending price increases, the company encouraged customers to continue shopping in the coming days.
“We are stocked and ready to make sure our orders arrive smoothly during this time,” Temu’s statement said. “We were doing everything we could to keep prices low and minimize the impact on you.”
Original issue: April 16, 2025, 6:03pm EDT
