Chinese online e-commerce platform Temu has become Hungary's largest online trading platform in terms of customer base and orders, posting staggering growth, according to online market researcher GKID, which has recently been acquired by PwC.

Senior analyst Norbert Madar shocked the audience at the Internet Hungary conference by revealing the figures. Temu recorded around 1.5mn orders in the first quarter of the year, which surged to 4mn by mid-2024. By year-end, the platform could exceed 10mn orders.

The company is on track to generate HUF130bn (€330mn) in revenue from Hungary in 2024, making it the largest e-commerce player in the market. To put this into perspective, the combined revenue of the 13 largest Hungarian-owned e-commerce companies was HUF157bn.

The total market for the top 15 players, including global giants, reached HUF543bn last year, while H1 2024 turnover was HUF671bn.

Hungarians placed HUF140bn worth of orders from foreign webshops in the January-June period, and Temu alone accounted for 35% of those sales, totalling HUF50bn.

Growth in Hungary’s online market is expected to accelerate to 8-9% in the second half of the year, up from 6% in the first half, as retail sales pick up due to rising real wages. However, according to Madar, Temu's dominance is set to have a long-lasting impact.

The rapid growth of Temu has been so significant that delivery services such as Packeta have struggled to cope with the surge in parcel volume, leading to weeks of delays. The company has had to implement extra measures to address the backlog.

The Hungarian government has also expressed concerns about the financial implications of the rise of foreign e-commerce platforms. In recent weeks, National Economy Minister Marton Nagy has focused on protecting the domestic economy, advocating for equal conditions for local retailers.

He has hinted at potential administrative measures to curb the influence of foreign retailers, claiming they have caused a HUF100bn shortfall in the budget by frequently avoiding VAT payments, with customs revenues not being realised in Hungary.

Additionally, Hungary's competition authority launched an investigation into Whaleco Technology, the European operator of Temu, earlier this year.