Chinese companies are shoring up their U.S.-based production and warehouses to evade the Trump administration’s crackdown on Communist Party of China (CCP) imports.
Fashion brand Temu is pushing its locally made products after the Trump administration put an end to a lucrative trade loophole that allowed Chinese fast fashion and low-cost goods to make their way into the U.S. and evade tax enforcement.
Temu is now promoting items stored in its U.S. warehouses under its "lightning deals" section and a "local warehouse" section on its website.
The Trump administration ended an exemption known as "de minimus," which allowed goods valued less than $800 to enter the U.S. without paying duties.
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The de minimus rule helped Temu offer the U.S. suspiciously low-cost goods like $5 sneakers and $6 knockoff AirPods.
Singapore-based, China-founded fast fashion brand Shein has adopted a similar strategy, and it now has a growing U.S.-based workforce of 1,500 and is increasingly relying on warehouses in California and Indiana.
This month, Shein opened a Seattle hub for U.S. fulfillment and logistics operations as it seeks to localize deliveries.
Meanwhile, Chinese quartz company Sunfat Marble and Granite put out a pro-Trump news release promising "intentions for a historic investment into America, with a commitment to create tens of thousand (sic) new American jobs, including construction of new manufacturing facilities across the heartland of the U.S., with an investment totaling $250 million."
"With President Trump in power, we’re more excited than ever to commit to the United States," the company said in a release seen by Fox Business.
"We understand Americans are skeptical of Chinese companies and concerned about foreign investment. It’s why we are also announcing a commitment to only hire American workers. There will be no H1-B visas. There will be no undercutting of American wages."
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On Monday, Trump slapped 25% tariffs on all steel and aluminum imports, which came one week after Trump imposed a 10% tariff on all Chinese goods.
CATL, the world’s top battery maker, has said it will consider building a U.S. plant if Trump opens the door to Chinese investment in the American electric vehicle supply chain.
"Originally, when we wanted to invest in the U.S., the U.S. government said no," CATL founder Robin Zeng told Reuters. "For me, I’m really open-minded."
China’s EV and battery firms are heavily subsidized by the CCP and face some of the steepest trade restrictions due to competition and national security concerns. Chinese EV imports are slapped with a 100% tariff, an effective ban.
It’s not clear how many of the Chinese-based efforts to build U.S.-based supply chains will be successful, and they pose a risk of furthering CCP intellectual theft by allowing such companies to do business here.
This week, Rep. Abe Hamadeh, R-Ariz., wrote a letter to the CEO of a Chinese battery company that operates in California, Stored Power Tech Technology Systems Inc., demanding to know more about its rumored links to China Shipbuilding Corp. (Fangfen), an entity controlled by the CCP. The company touts its ties to Fangfen on its LinkedIn page.
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"If these allegations are confirmed, the relationship would blatantly violate U.S. law," said Hamadeh. "The notion of a Chinese state-controlled enterprise penetrating the U.S. battery industry, especially with potential ties to the Chinese military, is a grave threat."
