When President Donald Trump launched his barrage of punitive “reciprocal” tariffs against US trading partners throughout the world back in April, most of them were initially aghast. But they needn’t have worried. Judicious interventions detailing the painfully inevitable inflation impact on US consumers, most notably from leading Wall Street bank JP Morgan, swiftly led to a 90-day pause on tariff imposition. However, the threat didn’t actually go away. Revised deadlines in July and August then emerged (which may or may not be yet another movable feast).
The latter was set to finally target European Union countries with 30% tariffs, and should the victims attempt retaliation, Trump has said the penalties will be much higher. After the original threat in April, European Commission president Ursula von der Leyen had put in place a plan to react through €21bn in tariffs on US exports into the EU, with a bizarre mixed focus including motorcycles, chickens and apparel. These, due to come into effect on 14 July, were suspended until “early August”.
Explaining her climb-down, Von der Leyen said: “We have always been clear that we prefer a negotiated solution with the US. This remains the case.” And she’s not alone in getting cold feet about a direct challenge to Trump. German finance minister Lars Klingbeil, with an extensive domestic automotive industry to defend, prefers to keep on talking: “Nobody needs new threats or provocations right now. What we need is for the EU to continue serious and targeted negotiations with the US. But if a fair negotiated solution cannot be reached, then we must take decisive countermeasures to protect jobs and companies in Europe.”
In that direction, the European Commission is already consulting on an extended package of tariffs to hit a further €95bn of US imports, including aircraft and alcohol, going above and beyond the first plan. The biker presence within that will be a revival of punitive counter-tariffs on Harley-Davidson and Polaris Indian Motorcycle products sold into Europe during Trump’s first term in office, when he also introduced heavy taxation on EU steel and aluminium exports to the US.
Should this all unravel into tit-for-tat tariff warfare, apparently the US is prepared to apply levies amounting to around €380bn on annual imports from the EU. On the motorcycling front, that could drastically inflate US market costs for every major European motorcycle manufacturer, including BMW Motorrad, Ducati, KTM, Piaggio, and Triumph.