b'6American Journal ofTransportation ajot.comSlide in dollar adds to woes ofDe Minimus is ending: European shippers exporting to US Whats next for US importersUS importers are pivoting their strategies as de mini-US Tariffs and the slide of the US dollar against the euro is handi- mis demise with July 1, 2027, end date approaches.capping European Union exports to the US.By Cathy Roberson, AJOTBy Stuart Todd, AJOT USimporterswerecaughtnalization,nearshoring,andthe off guard after a July 30, 2025,faster adoption of delivered duty The slide in the dollar against the euro is notfor beverages and 25% for perfumes and cosmetics. executiveordersignedbythepaid(DDP),wheretheseller a recent trend, the latter, currency now adopted by2025 sales of French wines and spirits to theUSpresident,fast-trackedtheassumesresponsibilityforthe 21 of the EUs 27 members, having appreciated byUS, their biggest export market, fell 21% to 3endofdeminimis,adecades- packageandallshippingcosts 13% against the greenback last year. billion ($3.565 billion) while volumes were downold customs, to August 29, 2025,until the goods are delivered to However,attheendofJanuary,thesingle9%,accordingtotradebodyFEVSandlargelyimpactingmillionsoflow-costa specified destination. If sell-European currency crossed the symbolic thresholdattributed to tariffs and the dollars depreciation. cross-border parcels. The exec- ersarentabletoadoptDDP, of $1.20 for the first time since June 2021, althoughFrench luxury goods giant LVMH appeared toutive order came just a couplesurprisedutieswilltrigger it has ceded a little ground in February. weather the upheaval in trans-Atlantic trade reason- ofweeksafterthesigningofhigher returns, negative reviews, Coupled with the imposition of 15% tariffsably well last year. The groups products, includingtheBigBeautifulBillonJulyand other backlash against mer-on certain imports into the US, within the frame- high fashion, watches, perfumes and champagnes,4,2025,which,amongotherchants. DDP could be adopted by work of the EUs trade agreement reached withdoubtlessbenefitedfrominelasticdemand,USthings, set an end date for the demorereputablebrandsormar-the Trump administration last summer, the currentimporters and consumers being largely insensitiveminimis rule for July 1, 2027. ketplaces, which would shift the weakness of the dollar or the strength of the euro,to price inflation. Theimpactwasnoticeablemerchant pool, said Huckeba.represents a serious handicap for the eurozonesTheUSaccountsforjustoveraquarterofas transpacific air cargo volumes export-oriented sectors. LVMHs global sales and while the first half ofplummetedaftertheeffective The headwinds appear particularly acute forlast year produced a modest decline, Q3 and Q4date. DHL Express, for example, exporters in the automotive, mechanical engineer- reversed the trend. saw a significant drop in US ing and capital goods sectors.bound shipment volume after the t AriFFt HreAtS Andr AteSdeminimisexemptionended. A t urningp Oint int rAde ? AnindicationofjusthowsensitivefreightUSbound billed weight for Germany,byfar,theeurozonesbiggestrates are to tariffs or threats of tariffs, was high- itstime-definiteinternational exporter, has significant trade with the USitlighted by Xeneta, the ocean and air freight rateservice dropped about 32% year-was valued at more than $160 billion in 2024 intelligence platform, in its monthly (air freight)over-year in Q3 2025, primarily driven by automobiles and machinery and otherreport in January. drivenbynewtariffsandthe industrialproductssuchaschemicals,pharma- OntheTransatlanticwestboundcorridor,eliminationofduty-freeaccess ceuticals, and electronics. An estimated 55% ofspot rates unexpectedly rose 3% year-on-year infor low-value parcels. FedEx and German exports to the US consist of capital goodsJanuary, despite a 4% decline in chargeable weight.UPS reported similar declines.and intermediates. This divergence may partly reflect the recent USChina e-commerce exportsMatt Huckeba, Chief Strategy Earlierthismonth,figuresfromGermanystariffthreat(triggeredinresponsetooppositionto the US plunged 51% in Octo- Officer, Evans TransportationFederal Statistical Office (Destatis) revealed thatto Trumps plans for Greenland)an additionalber,52%inNovember,and thecountrysexportstotheUSinDecember10%onimportsfromeightEuropeancountries50% in December, according toCEO and founder of cross-bor-totaled 11.8 billion ($14 billion), after seasonalfrom 1 February - before it was reversed on 21 Jan- China Customs data. der logistics platform, FlavorCloud, and calendar adjustment.uary. This demonstrates both the responsivenessRathna Sharad, describes 2025 as a This represented an increase of 8.9% versusand nervousness of shippers trying to protect theirt Hed eM iniMiSe xeMptiOn double-whammy for import-thepreviousmonthbutwhencomparedwithproduct margins, it stated. Thedeminimisrulehasershaving to deal with tariffs December 2024 exports were down 12.9%. For theThe withdrawal of the tariff threat by the USbeen around for years and hasand the end of de minimis. Tar-full year, Germanys exports to the US declinedadministration certainly appears to have promptedchangedconsiderablysinceitiffs and the end of de minimis by 9.3%, compared to the previous 12 months, toa temporary demand bump: in the week endingwas first enacted. In 1938, Con- hadenormousimplicationsfor 146.9 billion ($174.61 billion). 25January,volumesrose16%week-on-week,gress enacted Section 321of thedirect-to-consumerbrandsand In a paper entitled, One year of Trump 2.0:a period that typically sees only low single-digitTariff Act of 1930 to authorizebusiness-to-businessimporters. Abitterreckoning,Dr.SaminaSultan,Seniorgrowth. However, a weaker dollarmaking euro- the Secretary of the Treasury toWholesalesupplychainswere EconomistforEuropeanEconomicPolicyandquoted air freight more expensivemay be a largerwaive or reduce certain duties,disruptedwhichresultedin Trade, at the German Economic Institute (IW),factor behind the rate strength, Xeneta added. fees, and other taxes in orderchangesinsourcinglocations, notedthatGermanexportstotheU.S.haveAs for ocean freight, in its Market Update forto avoid expense and inconve- trade-lane shifts and movements declined sharply since President Trump began hisJanuary,DHLobservedthattransatlanticratesniencetotheUSgovernmentof certain commodities to free-second term of office. remainpressuredbyovercapacityandsofterUSdisproportionatetotheamounttrade-zones. It cannot be explained by tariffs alone. It isimport demand, even as ETS (EU Emissions Tradingofrevenuethatwouldother-also likely a consequence of the dollars depreci- System)-related costs keep the cost base elevated. wisebecollectedoncertain ation, itself driven by declining confidence in USimported goods with a fair retail stability, Sultan said. S HiFt int rAdep AtternSvalue in the country of shipment German exports of motor vehicles and partsRicoLuman,SeniorSectorEconomist,atof$1orless.Overtheyears, to the US dropped by almost 19% between Febru- Dutch bank ING, specializing in transport, logis- Congress amended Section 321 ary and October 2025 compared with a year ear- tics and the automotive industry, emphasized thatseveral times, raising the thresh-lier. Machinery exports declinedthecombinationofaweakerold and ultimately increasing it by 10 % and those of chemicaldollar against the euro, coupledto $800 in 2015.products fell by over 10%. with the impact of import tariffs,ThemainpurposeofSec-Automaker Volkswagen (VW)representedasignificantcosttion 321 was to protect the rev-recordeda13.6%declineinburden which U.S. importers andenue of the United States by, in deliveriestotheUSmarketconsumerswillbearthebruntthe words of Assistant Secretary lastyearversus2024whichitof eventually. It also affects theof the Treasury Chapman Rose, attributed to a challenging envi- competitivepositionofEuro- ensuringthatcustomsofficials ronmentcharacterizedbythepean exporters. were not spending a dollar to tariff situation. Hepointedtodatashow- collect 50 cents. However, that But its luxury brand PorscheingthattotalEUexportsbychanged by 2015 when section Rathna Sharad, CEO, FlavorClouddidreportanewall-timeUSvaluedropped6%yearover321wasconsideredasatrade sales record in 2025. year between Trumps so-calledliberalizing measure. One of the most visible strat-VWs German rival, BMWLiberationDayin April2025Bythe2020s,therewereegies by US importers has been Group,hasissuedprovisionalandend-November2025,andconcernsthatthedeminimistomovetowardbulkimporta-figures which reveal a 5% yoyRico Luman, ING that the last months of 2025 hadrulewasaidingtheimportoftionanddomesticfulfillment. increase in sales of its BMW andbrought more deterioration. illicit drugs which led to the endChinesee-commerceplatforms Mini brands in the US last year, despite a decreaseSohowareshippersandlogisticsservicesof the rule. suchasSheinandTemu,for of 4.6% in Q4. providers(LSP)respondingtotheupheavalinexample,expandedUS-based EU-U.S. trade? i MpAct OnuS i MpOrterS warehousecapacity,allowing w ineS AndS piritSH it The fact is that with the US tariffs interna- For importers, typically thosethem to import products in bulk Turning to France, the eurozones second-big- tional commerce has become politicized, triggeringfocused on e-commerce, the endand distribute domestically.gest economy behind Germany, 2025 annual fig- the start of a shift in trade patterns, he told AJOT. ofthedeminimisexemptionBrandssuchasLululemon ures from the Customs authority point to sales ofFor shippers, its a case of finding ways tomeans higher shipping and han- arealsoreviewingtheirinven-French products across the Atlantic remaining atreduce dependency (on the Europe-US trade lane)dling costs and, for some, a com- toryplacementstrategy.We the same level as 2024. by diversifying their supply chains. For LSPs activepleteredoofbusinessmodelsfulfillapproximatelytwo-thirds However,thisstabilitywasduesolelytotheon the transatlantic it means freight flows to thethat relied on de minimis. ofourUSe-commerceorders buoyancy of aerospace exports without which FrenchU.S. have less potential. So, the task facing themIn response to the end ofdethroughCanada.Mostofthose sales to the US would have fallen by 5% y-o-y, with ais to tap into potentially better business opportu- minimis, Chief Strategy Officershipmentswouldhavebeen drop of as much as 13% in the last quarter.nities on other trade lanes. They could also playforEvansTransportation,Mattunder $800 and would have qual-Affected by the rise in customs barriers, salesan important role in helping customers restructureHuckeba,suggestedthatthereified for the exemption. So, it has of base chemicals decreased by 60% compared totheir supply chains. wouldbeanincreaseinlocala meaningful impact on us [the the last quarter of 2024. The decline reached 42%(WOEScontinued on page 17) inventory strategies, SKU ratio- (NEXTcontinued on page 17)'