Harley to shift some production overseas, Walker pushes for ending all tariffs
Updated: 3:49 p.m. June 25, 2018
MILWAUKEE (CBS 58) -- Harley Davidson, based in Milwaukee, is now planning to move the production of some of its motorcycles overseas.
The move is in response to new European Union tariffs that recently took effect.
Harley Davidson says with the new tariffs in place, it will cost them more than $2,000 to send each bike to Europe, so they are going to move the production of motorcycles for European customers overseas. Now, lawmakers are weighing in.
"I'm going to push for ways that we can get to a level playing field so we don't have this tit for tat on any number of products out there," Governor Scott Walker (R-Wisconsin) said.
The "tit for tat" the governor is talking about is the European Union retaliating for President Trump's steel and aluminum import tariffs by placing tariffs of their own on more than $3 billion worth of American products, including motorcycles.
"The ultimate goal if we can get there is no tariffs, or, if anything, few tariffs on anything," Governor Walker said Monday.
The EU's new policy raises the tariff for motorcycles from 6% to 31%, making it much more expensive for Harley Davidson to send their bikes to Europe.
So Harley announced Monday they are they are moving the production of motorcycles for European customers overseas and will not be raising the prices of bikes for customers or retailers.
The company has not said whether jobs are at risk, although the Machinists Union that represents Harley-Davidson workers released a statement saying that Harley is using the tariffs as an excuse to move work overseas.
“Harley-Davidson’s announcement today is the latest slap in the face to the loyal, highly-skilled workforce that made Harley an iconic American brand. Harley pounced on news released Friday regarding EU tariffs on Harley motorcycles and the company will be implementing plans to offshore more production. Even before the EU’s announcement, Harley made the decision to close its plant in Kansas City and has manufacturing facilities in India and Brazil. It also announced a future plant in Thailand. This latest move is in keeping with Harley’s past decisions to open plants outside of North America."
House Speaker Paul Ryan's spokeswoman says that Harley's decision shows how harmful tariffs can be and the best way to help American workers and consumers is to open new markets.
Governor Scott Walker agrees.
"If we can put the pressure on realize the interest of the United States is not to put more tariffs on but rather to create a level playing field where there are no tariffs in the future that really whether it's Harley Davidson - whether it's an agriculture entity whether it's another manufacturer, that's really got to be our end game," said Governor Walker.
Senator Ron Johnson also commented on the news, releasing the following statement:
“Unfortunately, this confirms my concerns and is a far too predictable outcome of policies that give companies like Harley-Davidson incentives to make their products elsewhere. We need to hold China accountable for its trade abuses, but that does not need to come at the expense of American workers and businesses.”
United Steelworkers District 2 Director Michael Bolton also released a statement:
"We cannot speculate about how this morning’s announcement will impact employment in the U.S. Domestic sales are what drive production and employment at Harley’s U.S. facilities. The company built its reputation and image by making motorcycles here, and if the company wants to continue to market itself as an iconic American brand both at home and abroad, it needs to focus on U.S. production.
Harley’s desire to improve sales both domestically and abroad predates the Trump administration’s tariffs, as does the company’s willingness to build assembly facilities overseas to avoid tariffs. Not all barriers to trade originated with the current administration. India’s 50% and similar tariffs on imported motorcycles make it hard to sell in those markets. Harley started planning to build a production plant in Thailand years ago specifically to serve that market while avoiding a 60% import tariff. From the company’s statements, it plans to continue to manufacture parts for motorcycles in the U.S. and ship them to Thailand for assembly, as it does for facilities in Brazil and India. It would be alarming, to say the least, to find out that Harley Davidson motorcycles assembled elsewhere would later be exported to the U.S.
The USW has been fighting for more than 25 years to level the playing field for American workers while the unfair and illegal practices of certain trade partners have cost more than one million manufacturing jobs in the U.S. The USW continues to support trade policies that punish the cheaters."
President Trump also tweeted Monday afternoon saying in part "Surprised that Harley-Davidson, of all companies, would be the first to wave the White Flag."
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— Donald J. Trump (@realDonaldTrump) June 25, 2018
CBS 58 reached out to Harley for a statement and have not heard back. It is still unclear whether jobs in Milwaukee will be impacted.
Updated: 9:54 p.m. June 25, 2018
MADISON, Wis. (AP) — Gov. Scott Walker says his goal when it comes to tariffs is to level the playing field to where there are few or any imposed on products made in the United States, including Harley-Davidson motorcycles.
Walker says that's what he will push for in the wake of news that Harley-Davidson is shifting production of motorcycles headed for Europe from the U.S. to factories overseas due to increasing tariffs.
Walker says the issue was discussed at a U.S. Department of Commerce meeting he attended in Washington last week where he pitched companies on investing in Wisconsin.
Walker says increasing foreign investment will help with the trade imbalance and therefore lead to a reduction in tariffs. But he says the ultimate goal is the removal of all tariffs so "we don't have this tit for tat on any number of products out there."
Posted: 6:32 a.m. June 25, 2018
MILWAUKEE (AP) -- Harley-Davidson, facing rising costs from new tariffs, will begin shifting the production of motorcycles heading for Europe from the U.S. to factories overseas.
The famed motorcycle maker said in a regulatory filing Monday that European Union tariffs on its motorcycles exported from the U.S. jumped from 6 percent to 31 percent.
Harley-Davidson Inc. said that it will not raise its prices due to "an immediate and lasting detrimental impact to its business in the region."