The American daily users of the World Electronic Commerce Platform at a reduced price of PDD Holdings Temu dropped by 58% in May. American-Chinese Trade War.
TEMU has decided to reduce advertising expenditure in the United States and to move its strategy to carry out the order after the White House on May 2 ended the practice known as “minimis– which allowed Chinese companies to send low value packages to the United States without a price.
TEMU, with the rapid fashion giant Shein, had used this provision for years to ship articles directly from suppliers in China to consumers in the United States, keeping the low prices.
TEMU and Shein have both had a sharp drop in sales growth and customer growth rates since US President Trump announced scanning commercial prices, according to data collected by Bain & Company, but TEMU trends were worse than its rival.
The prices forced the two platforms to increase prices, but Shein was able to increase the amount of money spent per client compared to a year ago, the data showed, while TEMU had trouble.
TEMU did not respond to a request for comments on the decline in American daily users or winds -contrary winds with which he is confronted on the American market.
The commitment to TEMU fell significantly after the end of the exemption, said Smeon Gutman, actions analyst by Morgan Stanley, said in a note in May.
“Although the tariff environment is uncertain, if the status quo remains for an extended period, we believe that the competitive threat of TEMU will continue to weaken,” said Gutman.
Last week, The benefits of the first quarter of the PDD have dropped growth estimates And the leaders told analysts on a post-benefit call that the prices had created significant pressure for his merchants.
They reiterated TEMU’s previous commitment to maintain stable prices and work with traders in all regions, referring to a transition to a local realization model announced in early May.
The previous commercial model of TEMU gave merchants the responsibility to order and provide their products while the company based in China managed most of logistics, prices and marketing.
Now, the TEMU merchants “can send individual orders from China to Temu American warehouses, but they should face customs and documents,” according to a note from HSBC analysts. TEMU continues to manage the completion orders near the buyers, fixing prices and online operations.
In last week’s note, HSBC said TEMU growth on non -American markets had resumed, non -American users reaching 90% of its 405 million world -class active users in the second quarter.
“The new increase in users has become fast on the less rich markets,” wrote analysts.
