How Amazon Rival Temu Got Sucked Into Trump’s Trade War
Feb 18, 2025
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Spencer Soper, a Bloomberg reporter with over a decade of experience covering e-commerce giants, shares insights on Temu's explosive growth as a major competitor to Amazon since its 2022 launch. The discussion reveals how Temu's ultra-low prices attract price-conscious consumers. Soper explains the implications of Trump's tariff changes, exploring how they could raise costs for American shoppers and challenge Chinese retailers. The conversation dives into the evolving e-commerce landscape amid rising trade tensions and their potential impact on consumer choices.
Temu's rapid rise in the U.S. e-commerce market highlights the importance of adapting to changing consumer demands and competitive pricing strategies.
Proposed changes to the de minimis rule threaten to disrupt the affordability of imported goods for American consumers, potentially increasing prices and reducing choices.
Deep dives
Meta's Open Source AI Revolutionizes Job Search
Meta's open-source AI model, Llama, is empowering startups like RightSee to create innovative tools, including Job Search Genius. This AI-driven platform assists candidates in crafting effective resumes, practicing for interviews, and developing salary negotiation skills. By providing free access to such advanced technology, Meta opens opportunities for smaller companies to compete in the job market. The affordability and accessibility of Meta's AI model can significantly enhance the capabilities of aspiring job seekers.
Temu's Rise in the E-Commerce Market
Temu has quickly positioned itself as the second largest e-commerce platform in the U.S. since its launch in 2022. The app attracts consumers with its incredibly low prices, often significantly cheaper than competitors like Amazon due to its direct-to-consumer shipping model, which exploits the de minimis rule to avoid tariffs. Following a successful Super Bowl marketing campaign, Temu became a popular choice for consumers seeking budget-friendly options amidst rising costs of living. This rapid growth highlights Temu's ability to adapt to changing market demands and consumer behaviors post-pandemic.
Impact of the De Minimis Rule on U.S.-China Trade
The de minimis rule, which allows low-value goods to enter the U.S. without tariffs, has fueled the success of companies like Temu and Shein by offering consumers significant savings. However, proposed changes to this rule could drastically affect these Chinese e-commerce platforms and the prices American consumers have come to expect. An immediate drop in sales for these platforms was observed following announcements to close the loophole, leading to uncertainty among buyers about potential customs duties on larger purchases. As manufacturers and logistics companies scramble to adapt, American consumers may face higher prices, reduced choices, and longer delivery times in the near future.
Since its US launch in 2022, Chinese marketplace Temu has rapidly risen to become America’s biggest e-commerce platform after Amazon, thanks to ultra-low prices on almost every product imaginable.
On today’s Big Take Asia Podcast, host K. Oanh Ha speaks to Bloomberg’s Spencer Soper and Rachel Chang about Donald Trump’s order to close a tariff loophole and what it means for American shoppers and the giants supplying them with goods direct from China.