Two of China’s major fast fashion retailers, Temu and Shein, are bracing for price increases in the US due to President Donald Trump’s new tariffs on Chinese imports. These tariffs, reaching up to 145% on Chinese goods, coupled with the cancellation of duty-free exemptions for shipments under $800, spell trouble for these companies’ low-cost business models in the US market. Shein has informed customers of impending price adjustments from April 25, citing rising operating expenses.

Initially, Trump planned a 30% tariff or $25 per item, escalating to $50 by June 1. However, in response to China’s retaliatory tariffs, Trump tripled rates for exempt packages to 90% or $75 per item, increasing to $150 in June. Despite these challenges, experts suggest that Temu and Shein may still offer competitive pricing compared to other retailers.

The impact of these tariffs has led both retailers to reduce their US social media advertising spending, which has been instrumental in attracting young and budget-conscious shoppers. Temu’s and Shein’s ad expenditures on platforms like Facebook, Instagram, and TikTok have seen significant declines in recent weeks. Notably, Temu has scaled back its Google Shopping ads since mid-April.

As these fast fashion giants navigate the changing trade landscape, Meta declined to comment, while Google, Shein, and Temu were not available for immediate comment. The evolving tariff situation and its ripple effects on consumer prices and marketing strategies underscore the complex interplay between global trade policies and business operations in the fast fashion industry.