The ratings agency says the Milwaukee company's A-minus debt has negative implications because of tariffs imposed by the European Union in retaliation for US tariffs on steel and aluminum. "Harley must know that they won't be able to sell back into USA without paying a big tax!" Those tariffs are a retaliation for trade penalties imposed by the Trump administration.
"Earlier this year, Harley-Davidson said they would move much of their plant operations in Kansas City to Thailand". Harley-Davidson is using that (tariff on steel and aluminum) as an excuse.
But Harley-Davidson's plight in Europe drew fresh interest from French Parliament member Eric Straumann, who contacted Levatich to propose a new factory on the French-German border in Alsace. He incorrectly said Harley was moving production to Asia from the US, when in fact the expansion in Thailand was unrelated to the closing in Missouri. He argued this was done in retaliation to the imbalance of trade that the U.S. has with major trading partners including China, the European Union and India, Press Trust of India reports.
"When I had Harley-Davidson officials over to the White House, I chided them about tariffs in other countries, like India, being too high".
The U.S. and China are also volleying back and forth over tariffs.
Trump has dismissed the notion that his tariffs are to blame for Harley-Davidson's decision and has accused the company of using the duties as a false pretense for moving production out of the U.S.
Trump says he's getting other countries to reduce and eliminate tariffs and trade barriers, and open up closed markets. That was an empty threat - all motorcycles Harley sells in the USA come from American factories, and the company won't import into the market. On Monday, Trump said Harley waves "the White Flag" in the tariff fight - then continued to blast the firm on Tuesday.
According to CNBC, Harley-Davidson revealed it was planning to get around the tariffs by shifting some production overseas. "As a rider and owner of a Harley-Davidson and as a former Harley-Davidson dealer, I condemn this decision and I strongly urge them to reconsider it". Trump tweeted. "Their employees and customers are already very angry at them". If they move, watch it, it will be the beginning of the end.
Harley-Davidson says it would lose about $2,200 for each bike it exported, and a total of up to $100 million a year, due to the hike.