Wall Street Journal editorial board tears into Trump's trade policy

Harley-Davidson to move production for some motorcycles out of US after EU tariffs

Harley-Davidson to move production for some motorcycles out of US after EU tariffs

Unfazed by Trump's criticism, Harley-Davidson suggested it had no other choice after the European Union hit United States motorcycles with duties of 31 percent last Friday, up from just 6 percent, boosting the cost to EU consumers by about $2,200 (€1,800).

Harley-Davidson, which Trump has cited in the past as a company hurt by US trade regulation, said the increased tariffs would cost the company an extra $30 million to $45 million in 2018.

"Harley-Davidson expects ramping up production in worldwide plants will require incremental investment and could take at least nine to 18 months to be fully complete", the company said.

The EU's new policy raises the tariff for motorcycles from 6% to 31%, making it much more expensive for Harley Davidson to send their bikes to Europe.

The Wisconsin-based company already has factories in Brazil and India, and is opening one in Thailand, while closing its Australian plant.

Harley-Davidson said it would move production of motorcycles shipped to the European Union from the United States to its worldwide facilities in order to reduce the impact of newly introduced tariffs.

Alden said that given those two compelling economic cases, Harley-Davidson could be just the start of a series of manufacturing relocations outside the US.

All of which should be taken as pretty solid evidence that raising barriers to trade will ultimately harm American workers.

Trump responded angrily to the Harley-Davidson's announcement on Monday, saying he has fought hard for the 115-year-old Milwaukee-based company and was surprised by its plans, which he described as waving the "White Flag".

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The EU's tariffs were a direct response to the Trump administration's tariffs placed against steel and aluminum exports from Europe.

Harley-Davidson says that the bikes will cost $2,200 more a piece to export.

Harley's announcement came as administration officials struggled to present a united front on another element of Trump's trade policy, new measures created to curb China's ability to access American technology by investing in American companies. The Motor Company has made a decision to, get this, move a bunch of production to Europe to avoid European import tariffs.

In January, Harley-Davidson announced that it would be closing its plant in Kansas City and moving leftover production to York, Pennsylvania.

For motorcycles, the European Union raised its 6% tariff to 31%.

Analysts at Baird Equity Research cut its 2018 profit estimates for Harley-Davidson to $3.70 per share from $3.90 and now expect 2019 profit of $3.85, down from $4.20. Daimler AG warned last week that escalating tension between the USA and China will impair earnings its Alabama SUV plant and lower profit this year. US motorcycle sales peaked at more than 1.1 million in 2005 but then plummeted during the recession.

'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, according to CNN, said.

Tariffs levied against the United States in response to its own escalations against foreign cars could cost Harley-Davidson big time, and it's prepared to do what it can to minimize the effect. The company said the shift will require additional investment and could take nine to 18 months to complete. "That's what I'm going to push for, ways that we can get to a level playing field then we don't have this tit for tat on any number of products out there".

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