It was belatedly revealed on the 20th by Lee Hae-min, a member of the Jo Guk Innovation Party, that seller accounts of AliExpress Korea, a Chinese e-commerce company, were hacked last October, resulting in settlement funds exceeding 8 billion won not being paid on time. The photo shows the AliExpress logo. [Photo courtesy of AliExpress, Yonhap News]

From the second half of 2024 to early 2026, the names that have brought about the most rapid and dangerous changes in the Korean retail market are undeniably Ali and Temu. These two colossal Chinese e-commerce platforms have deeply penetrated the Korean consumer market with the single weapon of "ultra-low prices," attracting a vast number of users in a short period. However, as time passed, what was revealed was not an innovation in price, but a collapse in quality, a safety vacuum, and loopholes in regulatory sovereignty.

Ali and Temu's 'Ultra-Low Price' Strategy... A Result of 'Efficiency'?

From the outset, Ali and Temu's product strategy deviated from the normal trajectory of market competition. Notebooks for 999 won, drones for 1,000 won, free shipping, and unlimited coupons are all difficult to rationally explain at any stage of production, logistics, or distribution.

The problem is that this was not a result of 'efficiency' but a lure based on deception.

Consumers initially understood it as "cheap because it's made in China," but the products they actually received were often not just "problematic due to being cheap" but "products of garbage quality." Products that wouldn't power on, CPUs at the level of old e-waste, keyboards with input delays of several seconds, instances of receiving a photo of an apple after ordering an apple, and household items breaking after only a few uses were not exceptions but common occurrences.

Regulatory Asymmetry... A Tilted Playing Field Favoring Ali and Temu

Domestic companies must obtain KC certification, submit test reports, and bear responsibility for recalls and damages to sell even a single identical product. Conversely, when identical or more dangerous products are directly imported through overseas platforms, a significant portion receives customs or certification exemptions, and the responsibility for damages becomes unclear. This is not free trade but regulatory asymmetry, a tilted playing field favoring Ali and Temu, and a failure of the state to manage market order.

What completely changed the attitude of Korean consumers was not price or delivery, but safety. From the second half of 2024 to early 2025, investigations by various local governments, including the Seoul Metropolitan Government, revealed that many products sold by Ali and Temu contained harmful substances exceeding standard levels by tens to hundreds of times.

What was particularly shocking were the children's products. Phthalate plasticizers, lead, cadmium... These substances are not simply 'defective components.' They are directly linked to hormonal disruption, impaired neurological development, and reproductive toxicity. The fact that such levels were found in items that children put in their mouths, touch, and come into prolonged contact with has strongly alerted Korean society.

Ali and Temu's 'Ultra-Low Price'... An 'Exit Strategy' for China's Troubled Economy

The ultra-low prices of Ali and Temu are not simply a pricing strategy. They are closer to an exit strategy stemming from the crisis in China's economic structure.

Facing a crisis due to real estate collapse, domestic demand stagnation, and overproduction, normal markets would reduce production. However, Chinese authorities maintained factory operations, fearing mass unemployment and social unrest. The resulting surplus inventory was dumped overseas.

Economically, this is called export deflation – a method of shifting internal price deflationary pressures and overproduction to external markets. Korea, being geographically close, having purchasing power, and being a price-sensitive market, was the most suitable outlet.

Gacha Mechanics... The Goal is Traffic and Data

Another key strategy employed by Ali and Temu was gacha-style events. They stimulated consumers' psychology with phrases like "Almost won" and "One spot left," and encouraged friend invitations and contact access. However, the facts revealed afterward were clear. The winning probabilities were designed to converge to virtually zero, and the actual purpose of the events was not to provide products but to generate traffic and data. Consumers were treated not as customers but as promotional tools and information providers.

These platforms collect payment information, purchase patterns, and device/location information on a large scale, but transparency in data storage and utilization is lacking, and jurisdiction lies abroad. The Fair Trade Commission's crackdown on false and misleading advertising in 2025 was a belated but unavoidable measure. However, that measure alone could not eradicate the root of the problem.

There is a structural answer to the question, "How is it possible to ship a 1,000-won item internationally?" The Universal Postal Union framework categorizes China as a developing country. As a result, international postage rates from China are set abnormally low. A significant portion of the difference is borne by the importing country's postal system, i.e., Korean public funds. Goods produced within China's economic structure, where normal pricing is impossible, are being pushed overseas, and Koreans are the biggest victims.

China's Low-Priced Goods... Production in China, Consumption and Disposal in Korea

Low prices that would be impossible for goods that have undergone normal cost, quality, and verification are not the result of Chinese companies' efficiency but of cost concealment. Low-durability products that bypass safety certifications and quality inspections are used briefly and then turn into waste, with the disposal costs and environmental burden falling entirely on Korea. A structure of 'transboundary waste transfer' where production occurs overseas and consumption and disposal occur in Korea is becoming entrenched.

As of 2026, Ali and Temu are attempting to recover their image in the Korean market. As part of this effort, they are promoting expanded certifications, localization strategies, and large-scale investments.

This is an acknowledgment of the Korean market's importance and, simultaneously, an admission of the limitations of their initial strategy. However, from a conservative perspective, what is important is verification, not declarations. Unless regulatory compliance, clear accountability, and equal tax burdens are prerequisites, strategy changes are merely another form of packaging.

The flood of ultra-low-priced goods from Ali and Temu may appear beneficial to consumers in the short term, but in the long run, it erodes the domestic industrial base, nullifies safety standards, and collapses the trust of the entire market. Due to these substandard sellers from China, Korean companies that honestly comply with regulations and produce are losing their ground.

Editorial Department, Hanmi Ilbo