One of the most iconic American brands is shifting a portion of its U.S. operations overseas.
Last week, the European Union (EU) hiked its motorcycle tariffs from six percent to 31 percent as part of retaliation to President Donald Trump’s 25 percent tax on steel and 10 percent levy on aluminum. This would make it more expensive for certain companies to operate in the U.S., including Harley-Davidson.
Harley-Davidson announced that it would be closing some factories and sending jobs overseas to protect itself from the steep tariffs. The company sells about 40,000 motorcycles in Europe every year.
“Harley-Davidson believes the tremendous cost increase, if passed onto its dealers and retail customers, would have an immediate and lasting detrimental impact to its business in the region,” the company said.
Simply put: it will become more expensive for the biker brand to produce its products and the brewing trade war will impact international sales.
President Trump’s 2017 comments did not age well:
“We want to make it easier for businesses to create more jobs and more factories in the United States,” he said. “That means we have to make America the best country on Earth to do business, and that’s what we’re in the process of doing.”
U.S. steel companies may be having great times now, like they did in 2002 before the tariffs inflicted damage, but the good times will come to an end – they always do. This is what happens with protectionism and trade wars.
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