Tag: Devastating

HARLEY-Davidson may soon increase the prices of its motorcycles as the industry undergoes significant changes.

A worsening trade dispute and subsequent tariffs enforced by the European Union on American-manufactured motorcycles, including those from Harley-Davidson, might prompt the well-known brand to shift its production operations.

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As reported by Biz Journals, a leading Harley executive recently informed a Congressional subcommittee that the firm is at risk of facing a “devastating” and “indefensible” 56% tariff on American-made motorcycles sold in Europe.

Consequently, the company has requested Congress to negotiate fair trade agreements with the European Union, Canada, and Asian nations.

However, earlier this month, the EU stated that in retaliation to President Donald Trump’s administration imposing a 25% tariff on all steel and aluminum imports, it would increase tariffs on American products—including motorbikes, boats, and bourbon.

Jonathan Root, the firm’s chief financial officer and president of commercial operations, indicated that this situation would lead to a 56% tariff on American-manufactured Harleys sold in the EU.

Root addressed the subcommittee, stating: “My request today is straightforward—fairness.”

“It is evident that Harley-Davidson is being unjustly discriminated against and politically targeted by the EU and Canada.

Root contends that these tariffs are unjust, discriminatory, and driven by political motivations, highlighting that Harley-Davidson has already incurred significant costs from a previous 2018 tariff amounting to around $166 million.

He mentioned that the company managed this impact without passing the costs onto consumers.

“We are not seeking protectionism, merely fairness,” he emphasized.

“A 56% tariff is indefensible and will hinder our capacity to sell motorcycles in Europe.”

Root pointed out how other foreign markets impose luxury taxes reaching up to 150% and additional non-tariff barriers, citing Denmark as an example, where a 25% value-added tax and a 150% luxury tax are applied.

If any supplementary EU retaliatory tariff is applied, the price of a Harley-Davidson Road Glide sold in Denmark could soar to $124,000, significantly higher than the $28,000 starting price in the U.S.

This situation arises as Harley registered 25,860 new motorcycle registrations in Europe in 2024, compared to 94,383 in the U.S.

The figures encompass motorcycles sold in Austria, Belgium, Denmark, Finland, France, Germany, Italy, Luxembourg, Netherlands, Norway, Spain, Sweden, Switzerland, and the United Kingdom according to the latest Form 10-K annual report from the company.

Root also highlighted that Harley sources 70 to 80% of its parts from U.S. suppliers and provides jobs for 4,500 American workers out of a total workforce of 5,500.

He reinforced the company’s commitment to manufacturing in the U.S. and urged for a level playing field in international trade.