Temu Stops Importing from China and Switches to US Warehouses

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Temu, the popular online shopping app known for its ultra-low prices, is changing its operating model in the United States. On May 2, 2025, a rule called de minimis, which allowed low-value packages to enter the country tax-free. In response, the company stopped importing products directly from China and now ships all its orders from warehouses located in the United States. This change allows the business to avoid the new tariffs and maintain affordable prices for its customers.

Why Temu had to change

The exemption de minimis It was a loophole that allowed packages under $800 to enter tax-free. Thanks to that, Temu could sell products like sneakers for $5 or kitchen utensils for $2, directly from China, without additional tariffs. However, the Trump administration decided to close this loophole, imposing tariffs of up to 145 TP3T on Chinese products.

In response, the company eliminated products shipped from China and replaced them with items marked "Local Warehouse." These are stored in facilities within the U.S., ensuring that consumers don't pay extra fees.

What the new Temu model means for buyers

In April 2025, Temu began warning users about potential price changes due to rising trading costs. Since then, its website and app have displayed a "Local Warehouse" badge on many products. This indicates that the item is already in the U.S. and therefore unaffected by the new tariffs, offering faster deliveries without surprise fees.

The Chinese-owned platform says it's now working with local sellers to help them reach more customers and continue offering low prices.

How Temu compares to other brands

Other companies like Shein and Amazon's Haul also exploited the same loophole. Shein opted to raise its prices to cover the new tariffs, while Amazon stopped applying additional fees to its products.

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Fountain: CNBC