Harley-Davidson change lane
This week the news that the well-loved American motorcycle manufacturer Harley-Davidson is going to slow down its production in the USA has sparked a response from US President Donald Trump.
The motorcycle company, which has been based in Wisconsin since 1903, states that the move away from the USA is a reaction to increased import tariffs put in place by the European Union which are likely to stall the company’s international sales.
They said: "To address the substantial cost of this tariff burden long-term, Harley-Davidson will be implementing a plan to shift production of motorcycles for EU destinations from the US to its international facilities to avoid the tariff burden.”
The move to scale back domestically is the first from a USA based company and is a significant landmark in the trade war between America and the EU.
Growing tensions between the US and EU were sparked by Donald Trumps’ increased tariffs on steel and aluminium imports from the EU. This has now resulted in retaliation from across the pond, with up to 50% tariffs added on US to EU imports on items such as jeans, bourbon, orange juice, peanut butter, corn and Nike trainers.
To hit back at this Trump has threatened to add a 20% tax on cars imported from the EU.
Harley-Davidson is one of many companies that will be directly affected by the taxes, and appears to have no choice but to produce goods outside of the USA to try and swerve hefty tariffs which would see import tax on each product shipped internationally to the EU rise from 6% to 31%.
Slamming Harley-Davidson’s actions, Donald Trump Tweeted: “Surprised that Harley-Davidson, of all companies, would be the first to wave the White Flag. I fought hard for them and ultimately they will not pay tariffs selling into the E.U., which has hurt us badly on trade, down $151 Billion. Taxes just a Harley excuse - be patient! #MAGA”
Harley-Davidson is likely to increase investment in its other manufacturing plants located in Australia, Brazil, India and Thailand.
