On Tuesday, President Donald Trump railed against Harley-Davidson’s (HOG) announcement that it would move some manufacturing overseas after the European Union enacted tariffs that would impact Harleys built in the USA but sold in Europe. During the campaign he often talked about the company and as president he invited Harley executives to the White House.
Trump warned the iconic American brand that any shift in production “will be the beginning of the end”.
Tearing into Germany, he said, “They send Mercedes, they send BMWs, they send everything; we tax them practically nothing”.
Renacci, a former Harley Davidson dealer, is trying to ride President Donald Trump’s protectionist trade measures to victory in the Ohio Senate race.
The president’s fiery rhetoric is a stark departure from his previously cozy relationship with the company. They are based in based in Milwaukee, Wisconsin, and employ more than 6,000 people globally.
“Unfortunately, this confirms my concerns and is a far too predictable outcome of policies that give companies like Harley-Davidson incentives to make their products elsewhere”.
In January, Harley-Davidson said it would close a plant in Kansas City, Missouri, due to a sharp drop in US demand for its motorcycles, but said it would consolidate work done there into its plant in York, Pennsylvania. AshLee Strong says the best way to help American workers, consumers and manufacturers is to open new markets and not raise barriers. Still, Harley has said previously that a long-term goal is to expand its worldwide business and that it faces excess capacity in the USA, where sales of the iconic American brand have declined as its core market has aged.
“I do not think anybody expected this to escalate to the level that it’s at”, he said.
Trump responded to that Tuesday morning with a blistering statement threatening the company with a tax if it failed to do as he wanted.
Trump recently imposed steep tariffs on aluminium and steel imported from Canada, Mexico and Europe in his bid to level the trade playing field and reduce trade deficits between the U.S. and its trade partners.
Experts expect more US trading partners to retaliate. Besides, Indian interlocutors have asked, whatever happened to the USA resolve to back India’s rise as a global power and a balancing force in Asia? On the menu Tuesday morning are European Union tariffs and Harley-Davidson. “Hence, they were just using Tariffs/Trade War as an excuse”.
Indeed, the president held up Harley-Davidson as a model of American manufacturing, describing the 115-year old company as “a true American icon”, during a meeting at the White House in February 2017.
The president’s tweet references statements made by Harley Davidson as to why they planned to move some production in their company to an global location. Companies are now coming back to America.
Trump added that the administration is finishing a study on imposing tariffs on cars from the EU. As of 10:15 AM, Harley-Davidson stock is down almost 2%. In a piece by the Washington Post, the Mid-Continental nail, one of the country’s largest manufacturers of nails, say they will be laying off approximately 60 employees as a direct result of the European Union tariffs set forth by the Trump administration.
In another tweet Tuesday, Mr. Trump claimed Harley-Davidson is just using the increased trade tensions as an excuse to justify planned changes in manufacturing. In January, it said it would consolidate its Kansas City, Mo., plant into its York, Pennsylvania, facility. The plant also enables CKD assembly of a number of bigger motorcycles from Harley’s Sportster and Softail families. I can’t say for sure, but I imagine he has moved over a lot of businesses to avoid tariffs and taxes, he said.