Harley, Stung by Tariffs, Shifts Some Production Overseas
Portrait of GV Wire News Director Bill McEwen
By Bill McEwen, News Director
Published 7 years ago on
June 25, 2018

Share

MILWAUKEE — Harley-Davidson, up against spiraling costs from tariffs, will begin to shift the production of motorcycles headed for Europe from the U.S. to factories overseas.
The European Union on Friday began rolling out tariffs on American imports like bourbon, peanut butter and orange juice.
The EU tariffs on $3.4 billion worth of U.S. products are retaliation for duties the Trump administration is imposing on European steel and aluminum.

Harley-Davidson Warned Against Trump Tariffs

President Donald Trump has used Harley-Davidson as an example of a U.S. business that is being harmed by trade barriers. Yet Harley has warned consistently against tariffs, saying they would negatively impact sales.
Harley-Davidson Inc. sold almost 40,000 motorcycles in the Europe Union last year, generating revenue second only to the United States, according to the Milwaukee company.
The maker of the iconic American motorcycle said in a regulatory filing Monday that EU tariffs on its motorcycles exported from the U.S. jumped between 6 percent and 31 percent, which translates into an additional, incremental cost of about $2,200 per average motorcycle exported from the U.S. to the EU.
“Harley-Davidson maintains a strong commitment to U.S.-based manufacturing which is valued by riders globally,” the company said in prepared remarks. “Increasing international production to alleviate the EU tariff burden is not the company’s preference, but represents the only sustainable option to make its motorcycles accessible to customers in the EU and maintain a viable business in Europe. Europe is a critical market for Harley-Davidson.”

Harley Says It Won’t Raise Prices

Harley-Davidson will not raise its prices to avert “an immediate and lasting detrimental impact” on sales in Europe, it said. It will instead absorb a significant amount of the cost in the near term. It anticipates the cost for the rest of the year to be approximately $30 million to $45 million.
Harley-Davidson said that shifting targeted production from the U.S. to international facilities could take at least nine to 18 months to be completed.
The company is already struggling with falling sales. In January, it said it would consolidate its Kansas City, Missouri, plant into its York, Pennsylvania, facility. U.S. motorcycle sales peaked at more than 1.1 million in 2005 but then plummeted during the recession.
More potential pitfalls for Harley-Davidson and other U.S. manufacturers could be on the way.
Last week German automaker Daimler AG cut its 2018 earnings outlook, a change that it says is partly due to increased import tariffs for U.S. vehicles in China. Daimler produces vehicles in the U.S.

WTO Needs To Be Modernized

On Monday, the vice president of the European Union’s governing body said that Europe and China will form a group aimed at updating global trade rules to address technology policy, government subsidies and other emerging complaints in a bid to preserve support for international commerce.
European Commission Vice-President Jyrki Katainen said unilateral action by U.S. President Donald Trump in disputes over steel, China’s technology policy and other issues highlighted the need to modernize the World Trade Organization to reflect developments in the world economy.
The Wall Street Journal reported that the Trump administration plans to impose curbs on Chinese investment in American technology companies and high-tech exports to China.

DON'T MISS

23 for ’23: A Year in Photos

DON'T MISS

See How this Fresno roastery sends aid to Northern Thailand.

DON'T MISS

District Says Fresno Teachers Contract Proposal Would Bankrupt Budget Reserves by Year 3

DON'T MISS

Trump Vows to Ban Gaza Refugees, Expand Muslim Travel Ban If He Wins

DON'T MISS

The Supreme Court Orders Makers of Gun Parts to Comply with Rules on Ghost Guns

DON'T MISS

George W. Bush for Speaker? A Democratic Lawmaker Thinks It’s Possible

DON'T MISS

Former Navy IT Manager Gets Five Years for Hacking, ID Theft

DON'T MISS

Gunman Kills Two Swedes in Brussels, Prompting Terror Alert and Halt of Belgium-Sweden Soccer Match

DON'T MISS

Zakaria: The Best Response to Hamas Would Be to Keep the Saudi Deal Alive

DON'T MISS

Groundbreaking Human Brain Atlas Offers New Hope for Treating Neurological Disorders

UP NEXT

District to Fresno Teachers: Read Our Proposal Before Taking Strike Vote

UP NEXT

State Department Memo Warns US Diplomats: No Gaza ‘De-Escalation’ Talk

UP NEXT

George W. Bush for Speaker? A Democratic Lawmaker Thinks It’s Possible

UP NEXT

Jim Jordan’s Rapid Rise Cheered by Trump and Far Right. Could It Make Him Speaker?

UP NEXT

What Does Destroying Gaza Solve?

UP NEXT

Trump Vows to Ban Gaza Refugees, Expand Muslim Travel Ban If He Wins

UP NEXT

The Supreme Court Orders Makers of Gun Parts to Comply with Rules on Ghost Guns

UP NEXT

Gunman Kills Two Swedes in Brussels, Prompting Terror Alert and Halt of Belgium-Sweden Soccer Match

UP NEXT

Zakaria: The Best Response to Hamas Would Be to Keep the Saudi Deal Alive

UP NEXT

Fresno Politicians Say They Stand With Israel in Remarks at Cornerstone Church

Portrait of GV Wire News Director Bill McEwen
Bill McEwen,
News Director
Bill McEwen is news director and columnist for GV Wire. He joined GV Wire in August 2017 after 37 years at The Fresno Bee. With The Bee, he served as Opinion Editor, City Hall reporter, Metro columnist, sports columnist and sports editor through the years. His work has been frequently honored by the California Newspapers Publishers Association, including authoring first-place editorials in 2015 and 2016. Bill and his wife, Karen, are proud parents of two adult sons, and they have two grandsons. You can contact Bill at 559-492-4031 or at Send an Email

You May like

Trump Vows to Ban Gaza Refugees, Expand Muslim Travel Ban If He Wins

1 year ago

The Supreme Court Orders Makers of Gun Parts to Comply with Rules on Ghost Guns

1 year ago

George W. Bush for Speaker? A Democratic Lawmaker Thinks It’s Possible

1 year ago

Former Navy IT Manager Gets Five Years for Hacking, ID Theft

1 year ago

Gunman Kills Two Swedes in Brussels, Prompting Terror Alert and Halt of Belgium-Sweden Soccer Match

1 year ago

Zakaria: The Best Response to Hamas Would Be to Keep the Saudi Deal Alive

1 year ago

Groundbreaking Human Brain Atlas Offers New Hope for Treating Neurological Disorders

1 year ago

Newsom Signs Law to Slowly Raise Healthcare Minimum Wage to $25

1 year ago

Former Fresno CC Coach Ed Madec Arrested for Allegedly Threatening to Kill Chancellor

1 year ago

Jim Jordan’s Rapid Rise Cheered by Trump and Far Right. Could It Make Him Speaker?

1 year ago

HOT OFF THE PRESS

23 for ’23: A Year in Photos

1 year ago

1 year ago

Trump Vows to Ban Gaza Refugees, Expand Muslim Travel Ban If He Wins

1 year ago

The Supreme Court Orders Makers of Gun Parts to Comply with Rules on Ghost Guns

Photo of a hacker typing on a laptop

1 year ago