PDD Holdings Inc’s (NASDAQ:PDD) online retailer Temu and fast-fashion retailer Shein will increase prices next week to shift the burden of U.S. President Donald Trump’s tariffs and crackdown on affordable imports on consumers.
The companies shared plans to raise prices starting April 25, offering the customers a week to buy at the current prices, Reuters reported Thursday, citing the company’s websites.
Temu also slashed its online ad spending in the U.S. and noted plunging ranking in Apple Inc’s (NASDAQ:AAPL) App Store following U.S. tariffs on trading partners.
Temu has been spending money on TV ads and across Meta Platforms Inc (NASDAQ:META) Facebook to grow its market share in the U.S. by targeting budget shoppers.
Temu’s strategy helped it top Apple’s list of the most downloaded free apps in the U.S. for the past two years. However, downloads of Temu on Apple’s App Store have fallen 62% recently, CNBC reported Thursday, citing SimilarWeb.
Under President Trump’s tariff policies, packages shipped from China are now subject to a tariff rate of 145%. At the same time, he ended the duty-free status on low-value China imports. New rules slap 90% tariffs on sub-$800 China shipments, ending a key pricing edge for fast fashion.
Amazon.Com Inc’s (NASDAQ:AMZN) third-party marketplace sellers, many of whom source their products from China, are eying price hikes.
Last October, Amazon set strict price caps for its new low-cost storefront, with limits like $8 for jewelry and $20 for sofas, targeting discount rivals.
The new platform ships orders from China and offers sellers reduced fulfillment fees, aiming to boost affordable product offerings.
Amazon CEO Andy Jassy warned that tariffs on Chinese imports could result in higher consumer prices, as many of the company’s third-party sellers are unlikely to absorb the additional costs.
Temu was previously one of Meta’s largest advertisers, but it appears to have dramatically scaled back its spending on the platform.
Advertising analyst Brian Wieser at Madison and Wall told CNBC that over $7 billion of Meta’s $132 billion ad revenue in 2023 came from China.
Price Actions: PDD stock is up 1.93% to $94.13 at the last check Thursday.
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