Harley-Davidson, Inc. (NYSE: HOG)
Shares of Harley-Davidson, Inc. closed regular trading at 6% on Monday, after the iconic motorcycle manufacturer announced it plans to “shift production of motorcycles for EU destinations from the U.S. to its international facilities.”
The company said it is doing so to avoid carrying the burden of the recent retaliatory tariffs that were imposed by the European Union on American products, including its motorcycles.
The Milwaukee, Wisconsin-based company said in a filing Monday that the tariffs on its motorcycles exported to the European Union from America have increased from 6 percent to 31 percent.
Harley believes the tariffs will “result in an incremental cost of approximately $2,200 per average motorcycle”, causing it lose as much as $100 million annually.
The filing with the U.S. Securities and Exchange Commission said, “To address the substantial cost of this tariff burden long-term, Harley Davidson will be implementing a plan to shift production of motorcycles for EU destinations from the U.S. To its international facilities to avoid the tariff burden.”
The European Union levied tariffs against US imports, in response to US tariffs on EU aluminum and steel.
Some of the products targeted by the EU include motorcycles, whiskey, and denim jeans.
Harley’s decision is one of the most noticeable repercussions of the trade war sparked by President Donald Trump’s move to impose tariffs on aluminum and steel imports.
Harley-Davidson did not disclose whether any US jobs are at risk. Trump lashed out at the company in a Monday afternoon tweet for giving in to the EU. –MarketWatch
The President wrote “Surprised that Harley-Davidson, of all companies, would be the first to wave the White Flag. I fought hard for them and ultimately they will not pay tariffs selling into the E.U., which has hurt us badly on trade, down $151 Billion. Taxes just a Harley excuse – be patient! #MAGA”
Harley-Davidson, Inc. Company Profile
Harley-Davidson is engaged in the manufacture and sale of touring and cruiser motorcycles.
It operates under the Motorcycles & Related Products segment, and Financial Services segment.
Under the Motorcycles & Related Products division, the company designs, makes, and distributes on-road company-branded motorcycles.
It also offers motorcycle accessories and parts, including cosmetic and mechanical accessories, and replacement parts; and general merchandise, such as riding gear and MotorClothes apparel.
The segment sells its products through e-commerce channels as well as a network of independent dealers in the U.S., Europe, Canada, the Middle East, Latin America, the Asia-Pacific, and Africa.
The Financial Services segment offers retail financing solutions, such as installment lending for purchase of used and new company-branded motorcycles; and wholesale financing solutions, including open account and inventory financing of motorcycles, accessories and parts.
It also provides point-of-sale protection products, including motorcycle maintenance protection, extended service contracts, and motorcycle insurance.
Harley-Davidson, Inc. was founded in 1903 by Walter C. Davidson, Sr., Arthur Davidson, William A. Davidson and William Sylvester Harley. –Reuters
