Harley-Davidson responded to President Trump’s proposed tariffs on both steel and aluminum. The company said on Monday that a punitive, retaliatory tariff on its motorcycles in any market would have a “significant impact” on its sales there.
The European Commission’s president last week threatened to levy tariffs on US products that included Kentucky bourbon, Levi’s jeans and Harley-Davidson motorbikes if Trump followed through on a plan to impose global duties on aluminum and steel.
In a statement, the motorbike company said that it supports free and fair trade, and the proposed US import tariffs will drive up costs for all products made with aluminum and steel, no matter where the origin of the products is.
Harley Davidson has also enjoyed the benefit of tariffs under President Ronald Reagan. The New York Times reported in 1983:
In an unusually strong protectionist action, President Reagan today ordered a tenfold increase in tariffs for imported heavyweight motorcycles.
The impact of Mr. Reagan’s action, which followed the unanimous recommendation of his trade advisers, is effectively limited to Japanese manufacturers, which dominate every sector of the American motorcycle market.
”We’re delighted,” said Vaughn L. Beals, Harley-Davidson’s chairman. ”It will give us time that we might otherwise not have had to make manufacturing improvements and bring out new products.”
But it brought angry reaction today from Japanese officials and a threat to file unfair-trade charges against the United States in Geneva.
”We consider it unfortunate that the American side decided to take this kind of drastic measure,” said Hiroshi Ota, counselor for public affairs at the Japanese Embassy here. He added that Japan was considering taking a formal protest of the action to the General Agreement on Tariffs and Trade.
The action, which becomes effective in 15 days, affects large highway motorcycles with an engine displacement of more than 700 cubic inches,the only market in which Harley-Davidson now manufactures. It would raise the current tariff of 4.4 percent to 49.4 percent in the first year of the five-year program.
Tariffs for machines in the largest single market for motorcycles in this country, recreational machines under 400 cubic centimeters displacment, would not be affected by the action.
However, Harley Davidson has other problems like outsourcing work outside the US and making overpriced motorcycles. Millenials that are interesting in riding motorcycles are going to Yahama and Indian (made in the USA), for a more bobber type motorcycle like the Yamaha Bolt and Indian Scout. Millenials who enjoy motorcycling and have had trouble landing on their feet after college due to the recession aren’t going to buy an overpriced motorcycle. They are going to get the most bang for their buck. By the way, you still have to pay a tax on a brand new import bike.
Do you support the president’s proposed tariffs on aluminum and steel even if companies like Harley-Davidson raise their prices?
Credit: NY Post