The Hog is on President Donald Trump's carving board.
President Donald Trump slammed Harley-Davidson Inc HOG Tuesday for using tariffs as an "excuse" to execute previously planned production shifts to overseas plants.
Trump subsequently threatened the motorcycle manufacturer with high import taxes and warned that any move would be “the beginning of the end.”
Early this year Harley-Davidson said they would move much of their plant operations in Kansas City to Thailand. That was long before Tariffs were announced. Hence, they were just using Tariffs/Trade War as an excuse. Shows how unbalanced & unfair trade is, but we will fix it.....
— Donald J. Trump (@realDonaldTrump) June 26, 2018
....When I had Harley-Davidson officials over to the White House, I chided them about tariffs in other countries, like India, being too high. Companies are now coming back to America. Harley must know that they won’t be able to sell back into U.S. without paying a big tax!
— Donald J. Trump (@realDonaldTrump) June 26, 2018
A Harley-Davidson should never be built in another country-never! Their employees and customers are already very angry at them. If they move, watch, it will be the beginning of the end - they surrendered, they quit! The Aura will be gone and they will be taxed like never before!
— Donald J. Trump (@realDonaldTrump) June 26, 2018
The president’s tweets came a day after Harley-Davidson said it would shift some U.S. production abroad to evade the European Union’s retaliatory tariffs.
“[The move] is not the company’s preference, but represents the only sustainable option to make its motorcycles accessible to customers in the EU and maintain a viable business in Europe,” management said.
European sales accounted for 16 percent of total revenue in 2017 and represent Harley-Davidson’s second-largest market. Despite the strength, the firm suffered a 7.2-percent drop in global retail sales in the first quarter.
Harley-Davidson had warned that Trump’s earliest steel and aluminum tariffs would inflict additional pain.
The initial round inflates Harley-Davidson's costs by $15 million to $20 million, and resulting retaliatory taxes would drive costs another $30 million to $45 million higher this year, according to Reuters. The company said it would shift production rather than pass on price increases to customers, according to the wire service's story.
Trump trade adviser Peter Navarro said Monday that the administration’s policies would drive an increase in Harley-Davidsons produced domestically — but the company reiterated its position.
Harley's second-quarter report, due July 24, is likely to provide more details on overseas production plans.
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