Economy

U.S. trade policy drives Harley Davidson to create European Union jobs

U.S. trade policy drives Harley Davidson to create European Union jobs”

"Harley-Davidson maintains a strong commitment to US -based manufacturing which is valued by riders globally", the company said in a statement.

Mr Trump tweeted: "I fought hard hard for them and ultimately they will not pay tariffs selling to the European Union, which has hurt us badly on trade, down $151 Billion. Taxes just a Harley excuse - be patient!"

Brown-Forman fell to its lowest level in nearly seven months on Monday.

In a Securities and Exchange Commission filing, Harley-Davidson said the 31 percent tariff, up from 6 percent, would add about $2,200 to the cost of each motorcycle - and the impact could reach $100 million per year.

The impact on USA workers because of Harley-Davidson's decision was not immediately clear.

Harley-Davidson maintains a strong commitment to US -based manufacturing which is valued by riders globally.

While Trump has repeatedly claimed that the USA can win trade wars, victims are starting to pile up at home and overseas.

The company sold about 40,000 new motorbikes a year ago in Europe, equivalent to a sixth of its worldwide sales, making the region its most important market after its home country.

In the wake of the sluggish United States sales, Harley-Davidson announced in January it would close its Kansas City, Missouri assembly plant and consolidate jobs in York, Pennsylvania.

Last year, as Breitbart News reported, about 183 American workers were laid off by the motorcycle company in Kansas City and Menomonee Falls.

Executives in Harley-Davidson were among the first to visit the White House in February 2017 shortly after Trump took office. The company said it planned to keep prices for European Union customers steady while that shift was in progress, meaning it would absorb any tariff costs. In the near-term, the company will bear the significant impact resulting from these tariffs, and the company estimates the incremental cost for the remainder of 2018 to be approximately $30 to $45 million.

Harley-Davidson said it expected the ramp-up in production to take nine to 18 months.

The company is already struggling with falling sales.

United States motorcycle sales peaked at more than 1.1 million in 2005 but then plummeted during the recession. It wasn't immediately known whether any other facilities would be consolidated. Martinez added. "Does Harley even understand what "Made in America" means?"

The company chose to build the Thailand plant in response to Trump's decision to pull out from the Trans-Pacific Partnership which would have lowered import tariffs on its bikes in some of the fastest-growing motorcycle markets in Asia. And it has announced tariffs on $50 billion in Chinese goods - a tariff list that could swell to $450 billion if Beijing refuses to back down and counterpunches with retaliatory moves.

White House trade and manufacturing adviser Peter Navarro said on Monday the administration wants Harley to make more motorcycles in the United States. "Can't blame them. Many companies are being put in very hard positions".

Asked about the Harley decision, Wisconsin Governor Scott Walker addressed the issue of tariffs in general but not specifically the situation faced by the company.

Harley is not raising bike prices for customers or retailers.

Harley shares have lost about 6% since early March when the trade skirmish between the United States and the European Union started, and are down over 15% since end-December 2017.

"This is further proof of the harm from unilateral tariffs", AshLee Strong, a Ryan spokeswoman, said Monday.

Mr Trump has also threatened tariffs on foreign cars and auto parts, arguing that firms should make such products in the US.



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