Harley-Davidson: European Union Duties May Cause Price Increase

Harley-Davidson Inc. may be forced to increase its prices across Europe after the European Union added tariffs on goods exported from the U.S., hitting those purchasing new motorcycles when they are shipped later this year to dealers, said the chief of its European business.

Earlier in the week, members of the European Commission announced they would start charging 25% import duties on a series of different products from the U.S. starting Friday after the Trump Administration imposed its own tariffs on aluminum and steel from the EU that started the first of June.

Christian Arnezeder said during an interview that the tariffs will create an impact on price and the company will do all it can to makes it as painless as it can, but no business can foot the 25% tariff on its own.

A Harley spokesperson said that the group was evaluating the probable impacts of the duties set forth by the EU and that no decisions had yet been made for pricing.

Harley said it was being hit twice by tariffs: Once by import duty by the EU and once be an increase in prices of raw materials resulting from steel tariffs in the U.S.

At this time however, Harley does not feel the need to raise its prices as it used the close to three months since the first threat made by Europe to impose duties to prepare. Arnezeder said the company has attempted to get the current model bikes to Europe as quickly as they can and as far as their productions will allow.

He added that anticipation of the tariffs increased demand as motorcycle buyers sought to buy their new motorcycles before there is a price increase.

He added that you could tell by the market, in discussing with dealers, that some motorcycle customers had said they wanted to fulfill a dream before new tariffs were to be put into effect.

Struggling to get through a slump in demand across the U.S., Harley has been looking to increase sales of its overseas motorcycles to 50% of its complete annual volume from a current 43%. Europe, Africa and the Middle East represent slightly more than 21% of global sales during the most recent quarter.

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