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Harley-Davidson financial struggles
Harley-Davidson financial struggles
MILWAUKEE -- Harley-Davidson is looking overseas to break out of a sales slump here at home, but executives say a trade war is hurting the company's effort.
The iconic, 115-year-old motorcycle maker based in Milwaukee has come under fire from President Donald Trump for deciding to production of bikes sold in Europe to overseas plants.
On Tuesday, July 24, Harley-Davidson executives said on an earnings call that tariffs would cost the company $55 million this year. It's a combination of increased steel and aluminum prices and the higher cost of selling motorcycles in Europe.
"We are working with the administration, we are working with all governments we can, to do the best we can to get these tariffs removed," said John Olin, Harley's chief financial officer.
The executives never mentioned President Trump by name during the hour-long call.
Access to the European market is critical for Harley as its U.S. sales slump.
U.S. sales were off 6.4 percent in the quarter ending June 30 and 8.7 percent for the year. International sales ticked upward, led by strong growth in western Europe.
President Trump said Tuesday that his tariffs on imported steel and aluminum had forced other countries to the bargaining table, tweeting that "Tariffs are the greatest!"
The president has predicted that Harley-Davidson owners in the U.S. will punish the company for its plans to shift production, saying in early July that "everybody that ever bought a Harley-Davidson voted for Trump."
But Harley-Davidson's executives said Tuesday that the company has not felt negative consequences in the U.S. since making their announcement about production.
"We'll make sure we continue to monitor it and will do the right things to emphasize what Harley stands for and why -- and correct errors in interpretation that tend to pop up from time to time," said Matt Levatich, CEO of Harley-Davidson.
Harley-Davidson executives did not say how many U.S. jobs are at stake because of the production shift. They did say bikes sold in the U.S. will continue to be made here.
They also said they would make a separate announcement about long-term plans during another conference call on Monday, July 30.