Latvia's post-duty parcel count fell 26% in July, and PDD bulls say Europe replaces the US loophole

PDD Holdings closed September at $77.94, a 52-week low and about 6.2 times forward earnings, roughly a quarter of the 23 times its large-cap peers command ³. The bull case says Temu's shift to local warehouses replaces the lost US de minimis with Europe ³. The first hard counts from European customs argue the other way: buyers are not waiting to be served from Poland, they are stopping.

Latvia's July count fell 26% month over month

Latvia's postal operators published the first post-duty numbers on 1 October↗ ¹. Customs processed 710,000 low-value declarations in June, before the EU's €3 duty took effect on 1 July, then 525,000 in July and 528,000 in August ¹. Latvijas Pasts says the fall matches the EU-wide average of 30 to 50 percent; Omniva puts the initial drop near 70 percent, softened partly by a wait-and-see reaction as shoppers learned the new payment procedures ¹.

The 5.8 million declarations Latvia logged from January through August run 2.8 times its 2.07 million total for all of 2025 ¹. That pattern points to June's pull-forward ahead of the duty rather than sustained demand: the stockpiled month, not the pipeline, did the inflating.

France counted the same collapse at checkout

Médiamétrie data shows↗ Temu's French visits fell more than 40 percent in July and Shein's 36 percent, against an average basket of around €10 where a €3 duty bites hard ². French customs figures↗ put EU-wide small-parcel imports down 30 to 40 percent since the tax began, with June-to-July sales volumes down 50 percent at Temu and 37 percent at AliExpress ⁷. Dutch customs reported↗ July low-value imports down 60 percent year over year, yet still collected €35 million in the fee's first month ⁵. Two bases, one direction.

The fee schedule only tightens in November

November stacks a second charge: €2 per customs line, approved 21 September, tested in Spain from 1 October ². On IamExpat's arithmetic, a three-category order such as a charger, a shirt and a book carries €15 in combined surcharges, the €2 fee per line plus the €3 duty per item category, on top of VAT; the €2 fee alone on three lines is €6, and there is no universal €5-per-package rule, only whatever the declaration's lines carry ⁵². The €3 duty itself is temporary, giving way in July 2028 to standard category tariffs of up to 17 percent↗ ⁸⁴. Europe is not easing off, it is escalating.

PDD's numbers cannot see the segment bearing the cost

Temu's target of filling 80 percent of EU orders from within the bloc↗, backed by 10 self-operated warehouses, is the pivot working as designed ⁴. But PDD reports Temu inside one opaque segment, so its roughly 20 percent net margin and RMB 451.6 billion in net cash say nothing about the unit bearing the charges ³. What is visible in the filings: quarterly net income has fallen year over year in five of the last eight quarters, and hedge funds holding PDD dropped to 52 at the end of Q2 from 66 ⁶³.

The consensus target of $115.50 implies 48 percent upside, but only if Temu's local model scales before the parcel pipeline, and the fee schedule behind it, finish contracting ³. Latvia's counter says the demand the pivot was meant to replace is already shrinking; the question for November is at what price the remaining shopper stays.