Trump says Harley-Davidson's problems aren't his fault

Trump says Harley-Davidson's problems aren't his fault

U.S. President Donald Trump accused Harley-Davidson Inc. of using new tariffs on trade as cover for an existing plan to shift some production abroad and threatened the motorcycle manufacturer with a "big tax" on bikes imported to the U.S. if it relocates some plants overseas.

These European Union tariffs against specific USA products was meant as retaliation for Trump's imposition of tariffs against steel and aluminum imports from the European Union. Trump said in one of several tweets Tuesday.

In a regulatory filing on Monday, Harley-Davidson said the retaliatory measures had raised duties on US-made motorcycles from 6 percent to 31 percent.

"I fought hard for them and ultimately they will not pay tariffs selling into the European Union, which has hurt us badly on trade, down $151 Billion", Trump continued. "The Aura will be gone and they will be taxed like never before!" The company did not respond to request for comment on Tuesday.

The Trump administration imposed tariffs on imports of European steel and aluminum earlier this month, and in response, the European Union began charging import duties of 25 per cent on a range of US products including big motorcycles like Harley's on June 22.

"It believes that works out to be about $2,200 (£1,650) per bike it exports from the U.S. to the EU".

Harley-Davidson said it will not raise its prices to avert "an immediate and lasting detrimental impact" on sales in Europe.

Naturally, Trump felt betrayed and took to his favourite mouthpiece - Twitter - to express his ire.

"Increasing worldwide production to alleviate the European Union tariff burden is not the company's preference, but represents the only sustainable option to make its motorcycles accessible to customers in the European Union and maintain a viable business", the company said in a regulatory filing. "It's a great company", Kinzinger said. "On a full-year basis, the company estimates the aggregate annual impact due to the European Union tariffs to be approximately $90 to $100 million". According to Thomson Reuters, the European Union tariffs reduced Harley-Davidson's 2018 profit by 5-8 percent. Spokesperson Michael Pflughoeft said the company was "assessing the potential impact" on jobs.

It makes sense for Harley to reposition its long-term strategy outside the United States: Last quarter, Harley's sales in the United States fell 12%, but they grew 6.8% in Europe, the Middle East, and Africa. In 2017, almost 40,000 European customers bought new Harleys, compared with about 148,000 in the United States.

The tech-heavy Nasdaq slumped 2% on reports the US Treasury was drafting plans to block firms with at least 25% Chinese ownership from buying US tech companies. Harley-Davidson's USA bike revenue dropped 8.5% previous year from 2016, but only fell 0.4% in Europe.

Trump tweeted "Early this year Harley-Davidson said they would move much of their plant operations in Kansas City to Thailand".

Harley-Davidson opened plants in India and Brazil in recent years and is opening another in Thailand this year.

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