In a Securities and Exchange Commission filing, Harley-Davidson said the 31 percent tariff, up from 6 percent, would add about $2,200 to the cost of each motorcycle - and the impact could reach $100 million per year. A year after Trump pulled the USA out of a 12-nation trade deal, the Trans-Pacific Partnership, in January 2017, Harley announced it would close its factory in Kansas City, Missouri, and consolidate production in York, Pennsylvania, eliminating about 260 jobs. His next move may be to impose steep tariffs on German cars, which would constitute a serious escalation in an economic battle that is translating to real-world losses. Bikes built at these facilities for European customers won't be subject to the new EU tariffs, which came after President Donald Trump instituted steep tariffs on European steel and aluminum coming into the United States.
The Associated Press reports that while President Donald Trump is pointing to Harley as a prime example of an American business as those hurt by trade barriers, the bike maker has regularly warned against imposing tariffs.
In January, the company announced the closure of a plant in Kansas City, Missouri, after its motorcycle shipments fell to their lowest level in six years.
The company said ramping up production at non-US plants, which are located in India, Brazil and Thailand, would require additional investment and take at least nine to 18 months to complete.
European sales of Harley-Davidson motorcycles, the company pointed out, amounted to almost 40,000 bikes in 2017. Ron Johnson, R-Wis., who represents Harley-Davidson's home state, said in a statement.
On Monday, the company tried to smooth troubled waters, saying its shift of production overseas would not dent its "strong commitment to US-based manufacturing" which riders around the world valued.
Harley-Davidson said it would raise investment in its global plants, though it did not say which ones, adding that it expected the increase in production to take nine to 18 months.
The European Union has enacted tariffs on various USA -manufactured products, including Harley-Davidson motorcycles.
American brand Harley Davidson logo is seen in Krakow.
President Trump with Harley-Davidson CEO Matthew Levatich in 2017.
"We are now assessing the potential impact on our U.S. facilities", said Harley-Davidson spokesman Michael Pflughoeft.
Harley has been dealing with woes independent of Trump's policies.
The EU began levying the new tariffs Friday on $3.4 billion worth of USA goods such as motorcycles, bourbon and peanut butter.
The firm said that if it stayed in the US then it would result in an incremental cost of about 2,200 dollars per motorcycle sold in Europe.
Last week the European Union enforced tariffs on United States goods including bourbon, orange juice and motorcycles.
European Union tariffs will add $2,200 to the cost of an average motorcycle, Harley-Davidson said in a Securities and Exchange Commission filing.
For motorcycles, the European Union is raising its 6% tariff to 31%. Sales of the company's bikes have already been stung in recent years, with the initial bite of the recession followed by a general downturn in interest from Millennial riders.