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Harley Davidson Will Relocate Some Operations Outside The U.S. To Avoid Tariffs

Last updated on Tuesday, June 26, 2018

(WASHINGTON, D.C.) - Three days after the European Union (EU) imposed $3.2 billion in retaliatory tariffs on more than 100 American-made products motorcycle giant Harley Davidson announced it will relocate some its operations overseas.

"Harley-Davidson will be implementing a plan to shift production of motorcycles for EU destinations from the U.S. to its international facilities to avoid the tariff burden," the Milwaukee-based company said in a 8-K disclosure form filed with the Securities and Exchange Commission (SEC) on Monday. "Harley-Davidson expects ramping-up production in international plants will require incremental investment and could take at least 9 to 18 months to be fully complete."

Bran Renbaum, of Talk Media News reports, the company said: "EU tariffs on Harley-Davidson motorcycles exported from the U.S. have increased from 6 percent to 31 percent. Harley-Davidson expects these tariffs will result in an incremental cost of approximately $2,200 per average motorcycle exported from the U.S. to the EU."

The tariffs went into effect on Friday. The EU is considering a second round of tariffs that would increase the export burden to $4.3 billion.

Last month the Trump administration followed through with a plan to impose tariffs on steel and aluminum imports. The plan was announced in March. The EU, Canada and Mexico were given a two-month exemption.

The tariff regime is primarily designed to crack down on Chinese trade abuse, but the administration has not exempted close U.S. allies.

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