Trump threatens Harley-Davidson over European production move:The Asahi Shimbun

Jun 28, 2018, 17:15
Trump threatens Harley-Davidson over European production move:The Asahi Shimbun

The EU's top trade official today said the decision of Harley-Davidson to shift some manufacturing of its iconic motorcycles overseas, which President Donald Trump criticised, was a natural outcome of a protectionist U.S. trade policy.

The company, which sold almost 40,000 motorcycles in Europe previous year, said it planned to absorb those costs rather than pass them on to customers and risk damaging sales.

The president on Tuesday tweeted that if Harley goes through with its plans to move some production overseas, "it will be the beginning of the end - they surrendered, they quit!"

In response to the USA tariffs, the European Union began charging import duties of 25 percent on a range of US products including big motorcycles like Harley's on June 22. The union representing Harley workers previously said it expected the company to move production from Kansas City, Missouri, to Thailand.

Harley-Davidson plans to shift some motorcycle production away from the United States to avoid the "substantial" burden of European Union tariffs. "Hence, they were just using Tariffs/Trade War as an excuse", Trump tweeted.

The Trump administration slapped tariffs on imported steel and aluminum from the EU, Mexico, and Canada, earlier this month.

"Increasing global 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 in Europe", it argued. For that very good reason, Harley built a plant in India to produce motorcycles for the Indian market.

A day after Harley said it would shift output of bikes destined for European Union markets out of the USA to avoid 31 percent tariffs, Trump cited two earlier decisions Harley made to open a new plant in Thailand and close one in Missouri.

Trump on Tuesday criticized the company's decision in a series of comments on Twitter that contended the company already planned to move jobs overseas and was using the tariffs as a pretext.

"It doesn't really concern us in the states", he said.

The plant, which is in the Northland near Kansas City International Airport, was built in 1998 and employs about 800 people.

More potential pitfalls for Harley-Davidson and other US manufacturers could be on the way.

Johnson is also a former employee of Harley Davidson in West Fargo, where he was a parts manager for 14 years. This is clearly targeted at Milwaukee-based Harley-Davidson, though Indian Motorcycles (and parent company Polaris) will also be impacted.

In response to Trump's tariffs, Europeans are targeting the most iconic American products, such as motorcycles, blue jeans, and bourbon. But, contrary to Mr. Trump's tweet, it did not say at the time it was moving the operation to Thailand.

Asked about the Harley decision Monday, Wisconsin Gov. Scott Walker addressed the issue of tariffs in general but not specifically the situation faced by the company. Republican Sen. Ben Sasse, a vocal critic of the president's previous tariffs announcements, jumped to Harley's defense after its announcement Monday.

President Donald Trump has used Harley-Davidson as an example of a USA business that is being harmed by trade barriers.

Legend has it that the iconic American motorbike firm Harley Davidson claimed the "potato-potato" sound its V-twin engines make is so unique that it copyrighted the beat. The company says assembly of "America's motorcycle" in Thailand will lower prices and allow immediate exports to all of Asean and China.

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