Daily Management Review

Harley Davidson Threatened By Trump Over Shifting Production Out Of US


06/27/2018




Harley Davidson Threatened By Trump Over Shifting Production Out Of US
Harley-Davidson Inc would have to face a public back lash if it partly shifts its production away from the United States to avoid the tariffs imposed by the European Union. Said US President Donald Trump.
 
He also threatened the company with higher taxes. Super bike maker Harley Davidson had earlier got praise from Trump who described it as a symbol of American manufacturing.
 
“A Harley-Davidson should never be built in another country-never! Their employees and customers are already very angry at them,” Trump said on Twitter. He however did not provide any evidence of his claims. “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!” Trump said.
 
It was not immediately clear the type of tax that Trump was talking about and the reasons for it facing such taxes because it would still have production plants in the US. for domestic customers.
 
There was no response form the White House to Trump’s tweet.
 
There was an almost 6 per cent fall in the shares of Harley Davidson on Monday.
 
On Monday, the Milwaukee-based firm had announced the shifting of production of bikes for European customers to its international production facilities in order to avoid the tariff that has been imposed by the EU on American bikes among a host of other goods. The EU tariffs are in retaliation by the import tariffs announced by Trump in March on steel and Aluminum which would also now be applicable for all exports of the metals form the EU. Harley had said that the tariffs would cost it anything between $90 million to $100 million every year.
 
The firm also did not provide any comments to Trump’s tweets.
 
Ion a series of tweets, Trump also alleged that the bike company was making use of the existing trade tensions as a pretext to move production away from the US.
 
“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,” Trump said.
 
The company also closed down a factory in Kansas City, Missouri, in January this year because of a fall in demand for the bikes within the US.
 
In May 2017, Harley Davidson had announced the setting up of an assembly plant in Thailand where bikes would only be put together to cater to the customers in Southeast Asia.
 
Harley-Davidson Chief Executive Matt Levatich had told the media in February that there was no connection between the Kansas City plant closure and the facility in Thailand.
 
(Source:www.reuters.com)






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