Harley-Davidson to move some production outside US as Brussels retaliates against US tariffs on steel, aluminium

American motorcycle manufacturer Harley Davidson will move production of EU-bound motorcycles away from its US manufacturing base in answer to Brussels’ decision to retaliate against Washington’s tariffs on imported steel and aluminium. Tariffs are expected to add USD 2,200 per average motorcycle to affected vehicles.

The motorcycle maker is one of the first US companies to detail the financial impact of the trade tensions between Washington and its allies. According to the Milwaukee-based manufacturer, the financial impact of EU tariffs is estimated to USD 100 million.

However, the company announced that the increasing costs will not be passed on to customers. “Harley-Davidson believes 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, reducing customer access to Harley-Davidson products and negatively impacting the sustainability of its dealers’ businesses,” the group said on Monday morning, quoted by the Financial Times.

That is why, the company will not “be implementing a plan to shift production of motorcycles for EU destinations from the US to its international facilities to avoid the tariff burden.” Instead, it will “be implementing a plan to shift production of motorcycles for EU destinations from the US to its international facilities to avoid the tariff burden.”

Tariffs imposed by the EU on various US-manufactured products entered force on June 22 and have increased the levy on Harley-Davidson motorcycles exported from the US to the EU to 31 per cent from 6 percent.