As of May 2, 2025, the U.S. government has eliminated tax exemptions for small goods under $800 shipped from China and Hong Kong, imposing tariffs of up to 145%. As a result, Temu has halted its previous direct shipping model from China and switched to a local sales approach utilizing inventory within the U.S.

Currently, Temu has not completely abandoned the U.S. market, but it is significantly modifying its existing business model.

Temu is an online marketplace platform under Pinduoduo. It connects local Chinese manufacturers directly with global consumers, selling inexpensive products in bulk without intermediaries. The company adopts a complete consignment model, where producers in China or the U.S. only need to ship their products to Temu's logistics warehouse, and the rest is managed by Temu.

Time magazine reported in December 2023 that "an app that didn't exist just four months ago has surpassed TikTok, YouTube, and Instagram in downloads," stating that "it is attracting customers with unbelievably low prices while shipping from Chinese factories or warehouses," and expressed concerns that "if Temu's popularity continues, it will significantly impact U.S. retailers and the global supply chain."

Transition of Business Model

Temu no longer offers products shipped directly from China to U.S. customers, selling only products stored in U.S. warehouses. Additionally, it is recruiting sellers within the U.S. to enhance local sourcing and delivery.

Changes in Advertising and Market Share

Following the changes in tariff policy, Temu has drastically reduced its digital advertising in the U.S., leading to a decline in app download rankings. This is interpreted as an indicator of Temu's weakened position in the U.S. market.

Changes in Global Strategy

Due to increasing uncertainty in the U.S. market, Temu is exploring expansion into Europe and other regions. This appears to be a strategy to reduce dependence on the U.S. market and strengthen its position in the global market.

By discontinuing its direct shipping model in the U.S. and transitioning to local sales, Temu has effectively abandoned its previous strategy. However, it has not completely withdrawn from the U.S. market and continues to make efforts to adapt to the market in new ways. Future changes in U.S. government policies and Temu's response strategies are expected to alter its position in the U.S. market.