FEELING THE HEAT

Shein and Temu Lose American Customers After Trump Closed Key Tariff Loophole

The Chinese fast fashion giants have seen a sharp dropoff in demand.

President Donald Trump may have pressed pause on his harshest China tariffs, but Shein and Temu are still feeling the effects. The two e-commerce platforms, both giants in the world of fast fashion, have seen demand for their products plunge stateside since Trump announced his Liberation Day tariffs in April. Beyond his now-paused 145 percent tariff rate, the president also abolished a loophole known as “de minimis,” which allowed foreign companies to avoid tariffs when importing goods worth less than $800. The loophole was critical for platforms like Shein and Temu, which specialize in shipping ultra-low-cost items. As a result, both companies rapidly decreased their spending on advertising in the U.S., and Shein hiked its prices by nearly 400 percent for U.S. users. Now the online retailers have seen drastic drops in daily user activity from American customers, down 52 percent on Temu’s site and 25 percent on Shein’s. The two companies, which previously shipped goods directly from China to consumers, are also reportedly scrambling to establish American warehouses. For now, however, they’re also leaning on non-American markets. Last week, Chinese analysts reported that both Shein and Temu were experiencing marked growth in Latin America and Europe.