Less than a year ago, FEDEX and UPS executives were talking about how they dealt with a flood of packages from China to American consumers.
The “explosive” is how Carrol Tommy, CEO of UPS, described in July the volume of shipments from e -commerce companies that sell Chinese goods in the United States. “No airline can serve its entire needs,” said Berri Carrir, chief customer employee, Berri Carrire.
But this torrent is expected to slow down after President Trump closed on Friday a loophole that allowed cheap commodities from China to enter the United States without paying a tariff.
The transportation of hundreds of millions of low -value charges on up to 60 charging a day between China and the United States can now wither.
It can be prohibited in falling into such companies as companies as UPS, FEDEX and DHL for a large source of revenue. Airlines, especially those with charges only, and smaller logistics services can also suffer. Airlines may be hurt somewhat because they carry some of these packages as well.
UPS said last week that she expects revenue from shipping packages from China to the United States – the most profitable trade lane – to nearly 25 percent in the second quarter of this year, from the previous year. UPS also announced that it would reduce 20,000 jobs This year as part of a long -term plan to reduce costs, he said “total economic uncertainty” prevented him from updating its expectations for revenue and profits for 2025.
Ms. Tommy said that UPS from China to the United States was responsible for 11 percent of the company’s international revenue. I suggested that the company could take trade tensions by step, saying that when the trade between China and the United States decreased during Mr. Trump’s first term, it increased between China and the rest of the world.
But because Mr. Trump is now launching a more aggressive and broader commercial war, logistical services companies may not be able to compensate for lost sales easily in other places, where they managed from his first term.
“It was a rugged journey the last time,” said Gimme Credit analyst, Gimme Credit. “It took some time until things leak, but this may take longer.”
The definitions imposed by Mr. Trump on Chinese goods during his first term helped the leakage of inexpensive goods from China.
To avoid these definitions, Chinese sellers have increasingly sent the products to the United States under the gap that was closed on Friday to obtain imports from the mainland of China and Hong Kong.
The loophole known as minimal exemption is known as the import of goods of $ 800 or less without paying a tariff or filling in detailed customs documents. Now that the exemption ends, American shoppers will have to pay a tariff of up to 145 percent on Chinese goods, adding $ 14.50 for a $ 10 shirt cost.
Timo, one of the largest e -commerce companies that sell Chinese goods, said last week that it was no longer the charge of requests from China directly to American consumers. “All sales in the United States are now addressed by local sellers, with requests from within the country,” Timo said in a statement.
With the end of the exemption, the Wall Street analysts pressed the connection companies to predict the effect.
When asked to summon the investor in March about the share of revenue that came from De Minimis shipments, Fedex CEO, Raj Subramaniam, said it is a “minority”.
Isabelle Rolason, a spokesperson for FedEx, refused to provide a more accurate appreciation. “With regard to dividing our revenues through geography, we are serving a very diverse customer base across more than 220 countries and regions,” she said in a statement.
The Bon -based DHL, Germany, also said that the percentage of its work came from the minimum shipments of China. “Only a small part of our total size linked to the United States and the size of our total business in the United States market,” said Glennah Ivey-Walker, a DHL spokeswoman.
End of the exemption may be worse for transport companies if it was not for a late change in the rules by the Trump administration.
Low -value goods are set to subject to strict customs bases that require detailed leaves. But the administration at the end of last month issued a concession that allowed the goods to be easier.
Some trade experts said that changing the administration undermines the collection of customs tariffs because it deprived customs and protecting the borders from the information it needs to ensure that the importers were paying the correct amount of import duties.
“If you do not know exactly what is good, it is difficult to know what a potential value is the appropriate value or what the correct tariff should be,” said Lori Walsh, director of the American Economic Liberties Program, an organization that seeks to reduce the strength of large companies.
But some customs lawyers said that, even after the waiver, detailed information will remain.
The waiver came after DHL stopped making some shipments that were subject to the requirements of the papers, and after they spoke to the Trump administration members.
“The waiver” will not make it difficult to collect customs duties or in no way hinder the government’s ongoing efforts to protect its borders. ” She added that DHL had spoken to the administration to highlight the delays that may occur if the requirements of detailed papers are imposed.
A sharp decrease in low -value charges can shake airlines.
Air cargo shipments had already slowed even before the end of the exemption on Friday.
By mid -April, the air freight movement from China fell from the mainland and Hong Kong to the United States by 16 percent from the previous year, according to the industry data. Experts say traffic is likely to slow in the coming weeks.
“We expect to see up to 30 to 40 percent of the Chinese capacity to the United States coming out of the market,” said Derek Landing, founder of Cirrus Global Advisors, an e -commercial and supply chain.
The most active transportation companies in e -commerce trade between China and the United States include the American airlines companies, Atlas Air Worldwide and Kalitta Air; Hong Kong Cathy Pacific Airlines; And shipping departments for Chinese airlines, according to several air freight experts.
The airlines in the United States are not weak because they are working on relatively few flights between the United States and the mainland of China and Hong Kong.
Experts said Chinese companies may try to sell more commodities to clients elsewhere, including in Europe, Australia, New Zealand and Latin America.
There are already signs of such a shift. While air cargo shipments from China to the United States decreased in weeks before the exemption ended, flights to Miami, a flight center to Latin America, had increased somewhat, according to Mr. Sayed.
