PDD Holdings' (PDD) Temu is giving up substantial control over its Chinese supply chain because of the new tariffs introduced by President Donald Trump, Bloomberg News reported Tuesday, citing sources familiar with the matter.
The company is encouraging merchants to transition to a "half-custody" system, where factories handle bulk shipments to US warehouses while Temu oversees the online marketplace, the sources told Bloomberg.
This shift, which Temu intends to fully implement for its US operations, could reportedly raise costs for sellers by eliminating shipping efficiencies, potentially leading to higher prices for consumers.
The news outlet added the company is preparing for the likely removal of the US "de minimis" rule, which currently allows small parcels valued under $800 to enter the country without tariffs.
Temu did not immediately respond to MT Newswires' request for comment.
Shares of PDD Holdings were down more than 2.5% in recent Tuesday premarket activity.
(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)
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