Harley-Davidson chief executive Matt Levatich, pictured right, has responded to US President Donald Trump’s repeated vitriolic attacks on his company since it announced plans to move some production overseas to avoid punitive EU tariffs.
In a memo to Harley employees and dealers, Levatich carefully avoided mentioning Trump by name or labelling his angry presidential tweets as “fake news”, but the insinuation was fairly obvious, writes BDN financial editor Roger Willis.
Levatich wrote: “We unfortunately find ourselves in the centre of a heated political conversation about fair trade. There continues to be misinformation circulated in conjunction with this issue, and I want to reiterate and share facts about Harley-Davidson that you can both be proud of and share with interested customers.
“Harley doesn’t sell motorcycles in the US that are built overseas and that won’t change. The only reason we have invested otherwise is so that our products have a fighting chance of being price-competitive in markets that burden [them] with high tariffs. The company is absorbing the cost of the European tariffs to protect dealers and customers there, at a cost of about $90 million to $100 million annually, but we cannot carry these costs indefinitely.”
And in a separate move, Polaris chief executive Scott Wine, pictured, has also announced that Indian motorcycle production for the European market would be off-shored too. However, like Harley’s Levatich, he issued an assurance that production for the US market would remain in America and no US jobs would be lost.
Wine claimed that plans to move some Indian bike production to the Polaris ATV factory at Opole in Poland had been under way “for quite some time” and avoiding the latest EU tariffs was merely “an added benefit”. He also said that the US-EU trade dispute would cost Polaris $40 million in lost sales during the rest of 2018, even though — unlike Harley — it is already raising prices rather than absorbing the tariff impact.