What will happen with Temu and Alibaba after Trump's 104% tariff?
Trump's renewed tariffs on China, including a 104% duty on specific imports, threaten platforms like Temu, but Alibaba may benefit from all this.
With former President Donald Trump reviving his tough stance on China — and this time, he’s not pulling any punches. A fresh wave of tariffs, including an eye-popping 104% duty on certain Chinese imports, is shaking up e-commerce platforms like Temu and Chinese giants like Alibaba. So, what’s next for your online shopping cart and the stock market?
Let’s start with Temu, the viral shopping app known for jaw-droppingly cheap goods shipped straight from China. It’s been using the “de minimis” loophole, which allowed duty-free imports under $800. But that door just slammed shut. Trump signed an executive order ending the de minimis exemption, meaning Temu’s entire business model could be in trouble. And the price—it could be sky-high.
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Temu’s parent company, PDD Holdings, hasn’t said if it’ll hike prices just yet. But let’s be honest: “companies usually force consumers to eat at least a portion of the additional charges.” That means your $4 phone case could cost a lot more soon — especially as tariffs kick in on May 2, with fees of up to 30% or a flat $25 per item.
How Trump tariffs will affect Alibaba
Meanwhile, over on Wall Street, Alibaba (NYSE: BABA) is in the spotlight. Chinese tech stocks are feeling the heat, but some investors are seeing opportunities where others see red flags. “The stock market is not thinking; it is only feeling,” one investor told Benzinga.
Alibaba stock has dropped to just 78% of its 52-week high, making it a tempting buy for bargain hunters. But unlike Temu, Alibaba isn’t overly dependent on US shoppers. The bulk of its e-commerce revenue comes from China and Asia-Pacific markets, which remain largely shielded from US tariffs.
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More importantly, Alibaba’s cloud computing business — growing at double-digit rates — is where real long-term value lies. In fact, Bank of America recently boosted its stake in Alibaba by 7%, and analysts at Mizuho raised their target price to $170 per share.
