Harley, stung by tariffs, shifts some production overseas

Harley-Davidson, up against spiraling costs from tariffs, will begin shifting the production of motorcycles headed for Europe from the US to factories overseas.

The European Union on Friday began rolling out tariffs on American imports like bourbon, peanut butter and orange juice. The EU tariffs on $3.4 billion worth of US products are retaliation for duties the Trump administration is imposing on European steel and aluminum.

Harley-Davidson Inc. sold almost 40,000 motorcycles in the Europe Union last year, generating revenue second only to the United States, according to the company.

The maker of the iconic American motorcycle said in a regulatory filing Monday that EU tariffs on its motorcycles exported from the U.S. jumped between 6 percent and 31 per cent. The company said it expects the tariffs will result in an incremental cost of about $2,200 per average motorcycle exported from the US to the EU.

"Harley-Davidson maintains a strong commitment to US-based manufacturing which is valued by riders globally," the company said in prepared remarks.

"Increasing international production to alleviate the EU tariff burden is not the company's preference, but represents the only sustainable option to make its motorcycles accessible to customers in the EU and maintain a viable business in Europe. Europe is a critical market for Harley-Davidson."