Harley-Davidson wants to live to ride another day. Cue the rage.
When it comes to misguided revenge, Sons of Anarchy has nothing on Donald Trump. The President’s own man-of-mayhem trade policies have forced Harley-Davidson to move some of its motorcycle production overseas. But Mr. Trump responded to this week’s announcement by menacing the company on Twitter Tuesday morning.
.. “A Harley-Davidson should never be built in another country—never!” Mr. Trump raged. “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!” In another tweet, the President added, “Harley must know they won’t be able to sell back into U.S. without paying a big tax!”
.. So the company was left with two choices: Avoid the tariff by moving operations abroad, or pay the new EU tax, which will cost the company $90 million to $100 million each year. Keep in mind that Harley is already paying $15 million to $20 million more for manufacturing this year because of Mr. Trump’s tariffs on metal... Harley is dealing with union backlash for opening a production plant in Thailand while closing one in Kansas City. Harley made that hard call after Mr. Trump withdrew from the Trans-Pacific Partnership last year, though that agreement would have reduced foreign tariffs on American-made motorcycles.Mr. Trump’s TPP decision made it harder for Harley to compete in the Asian market while still using U.S.-based steelworkers and machinists. Cause, meet effect... We remember how Barack Obama railed against Anthem for raising insurance premiums when Democrats were distorting the health-care market. One might expect that Mr. Trump, supposedly savvier about business realities, would understand how corporations have to make tough choices to survive bad policies. Mr. Trump should rage against the man in the mirror who is the reason for Harley’s choices.
Harley-Davidson, Blaming E.U. Tariffs, Will Move Some Production Out of U.S.
As President Trump pursues a protectionist trade policy, he has pointed repeatedly to Harley-Davidson, the iconic American motorcycle manufacturer, as a company that will ultimately benefit.
Instead, it is getting caught in the crossfire.
.. While Mr. Trump says his trade policy is aimed at reviving domestic manufacturing, Harley-Davidson’s move shows how the White House approach could backfire as American companies increasingly rely on overseas markets for materials, production and sales.
.. On Monday, the company said the tariffs on its motorcycles had increased to 31 percent from 6 percent, adding, on average, $2,200 to every motorcycle exported from the United States to Europe.
.. Speaker Paul D. Ryan, a Wisconsin Republican, said on Monday that Harley-Davidson’s decision was evidence that raising trade barriers was a bad idea.
.. estimated that fewer than 10 percent of Harley-Davidson’s motorcycles were manufactured abroad.
Trump’s Tariffs Prompt Global Threats of Retaliation
The European Union detailed a three-step plan to penalize $3.5 billion of American trade — the same amount of European steel and aluminum the bloc estimates would be harmed by the planned tariffs. It proposed taxing American exports including bourbon, bluejeans, orange juice, cranberries, rice and motorcycles.
A European Union official said that the bloc had been preparing for the announcement for months and that everything was in place for a swift, proportionate response.
.. The measures were intended to put pressure on politically sensitive areas, trade analysts said. Harley-Davidson motorcycles are made in the home district of Speaker Paul D. Ryan, Republican of Wisconsin. Orange juice comes from the swing state of Florida. Restrictions on Kentucky bourbon could add pressure on the Senate majority leader, Mitch McConnell, who is from the state.
.. Retaliation could hit hardest in many of the rural communities that were strongholds for Mr. Trump. Farmers are among America’s largest exporters, and often become a target in trade spats
.. She said the agricultural community was “rightly nervous” about the prospect.
.. Canada and Mexico were America’s No. 1 and No. 3 largest agricultural markets in 2016, and South Korea is a major market for beef, corn, pork and fresh fruit
.. The United States exports cotton to Turkey and wheat and dairy to Brazil, other major suppliers of steel.
.. Peter Navarro, a top White House trade adviser, said he did not believe any country would retaliate, “for the simple reason that we are the most lucrative and biggest market in the world.”
“They know they’re cheating us, and all we’re doing is standing up for ourselves,” he added.
.. if the United States was willing to impose penalties like these on its close trading partners, other countries would be less eager to negotiate trade deals with the United States. “What is the benefit of having a special relationship?” he asked. “I think there could be a lot of unintended and unforeseen consequences.”