Temu and Shein's European squeeze

Temu and Shein are now large enough in Germany for economists to put a price on the damage: €2.5 billion a year in lost retail sales. (zdfheute.de) The estimate comes from IW Consult, working for the German Retail Federation, or HDE, and is based on a February 2026 online survey of 4,000 consumers aged 16 to 69. The study says more than 40,000 jobs have already been lost in Germany, mostly in retail. (zdfheute.de) The same analysis says 51% of Temu and Shein shoppers would have bought the same items elsewhere at the same price if the Chinese platforms were unavailable, and 19% said they would have paid more. It also puts the broader hit to the German economy at roughly double the retail loss once rent, logistics, energy and wages are counted. (zdfheute.de) The parcel flow helps explain the scale. HDE says Temu and Shein sent about 460,000 packages into Germany every day in 2025, and the study says the resulting tax loss for federal, state and local governments could reach €420 million a year. (zdfheute.de) Germany is not dealing with this in isolation. The Council of the European Union said on December 12, 2025 that goods entering the bloc in consignments worth less than €150 will face a fixed €3 customs duty from July 1, 2026, ending the duty-free treatment that helped direct-from-China e-commerce grow. (consilium.europa.eu) That customs change follows a wider European crackdown on cheap imported e-commerce goods. The Council said the temporary duty was meant to address unfair competition for European sellers, fraud, consumer safety risks and the environmental costs tied to the flood of small parcels. (consilium.europa.eu) German retailers have been pressing for tougher action for months. In February 2026, HDE urged Chancellor Friedrich Merz to consider an import ban as a last resort, arguing that Temu and Shein were benefiting from unequal enforcement of European safety and environmental rules. (heise.de) The platforms are still growing despite that pressure. Research cited by Heise says Shein’s net revenue in Germany rose 18% to €1.1 billion in 2024, while Temu nearly quadrupled its German gross merchandise volume to €3.4 billion, lifting it to fifth place among business-to-consumer marketplaces. (heise.de) Across the European Union, the audience is already massive. Deutsche Welle reported that in the first half of 2025 Temu averaged 115 million monthly active users in the bloc and Shein averaged 145 million, based on the companies’ own figures. (dw.com) European regulators have also gone after the platforms directly. The European Commission said on July 28, 2025 that it had preliminarily found Temu in breach of the Digital Services Act over how it assessed the risk of illegal products, and on May 26, 2025 it said Shein was being pressed by the Consumer Protection Cooperation Network over practices including fake discounts and unclear consumer information. (ec.europa.eu 1) (ec.europa.eu 2) The German study lands before Europe’s new €3 parcel duty takes effect on July 1, 2026, with one message already visible in the numbers: even under heavier scrutiny, Temu and Shein are still winning orders at a scale local retailers can feel. (consilium.europa.eu) (zdfheute.de)