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Trump threatens Harley-Davidson with taxes ‘like never before’ and predicts its eventual collapse
by Damian Paletta June 26 at 8:40 AM Email the author
1:18
Harley-Davidson to shift portion of production overseas
President Trump on Tuesday threatened the iconic motorcycle company Harley-Davidson with severe taxes and predicted a public revolt that he said would eventually put the 115-year-old firm out of business, blasting the Wisconsin company for a plan to move some operations outside the United States as a way to avoid getting caught in the middle of an escalating trade war.
A Harley-Davidson should never be built in another country-never! Their employees and customers are already very angry at them. If they move, watch, it will be the beginning of the end - they surrendered, they quit! The Aura will be gone and they will be taxed like never before!
— Donald J. Trump (@realDonaldTrump) June 26, 2018
Trump also accused Harley-Davidson, without providing any evidence, of intentionally misleading Americans by saying the firm was moving some operations out of the United States in response to new tariffs imposed by the European Union.
The intensity of these attacks, which he typically reserves for political opponents, came in Twitter posts.
He alleged that Harley-Davison’s Monday announcement that it would move some more operations outside the United States was long planned and that it was using Europe’s new tariffs as an excuse. He threatened to hit the company with an unspecified tax if it attempted to sell motorcycles in the United States that were made outside the country.
Early this year Harley-Davidson said they would move much of their plant operations in Kansas City to Thailand. That was long before Tariffs were announced. Hence, they were just using Tariffs/Trade War as an excuse. Shows how unbalanced & unfair trade is, but we will fix it.....
— Donald J. Trump (@realDonaldTrump) June 26, 2018
Harley-Davidson had long planned to open a new plant in Thailand, a decision that predated the trade war between Trump and the leaders of a number of other countries. But the firm said Monday that it was shifting more production overseas specifically to blunt the impact of the tariffs imposed by Europe.
These E.U. tariffs on specific U.S. products were imposed in retaliation against Trump’s tariffs on steel and aluminum imports from the E.U.
Tuesday marked Trump’s second straight day of leveling attacks at Harley-Davidson. The company’s announcement sparked a massive sell-off in the stock market amid fears that other companies might follow suit, worried about getting caught in the middle of Trump’s trade war with Europe, Canada, Mexico, China, Japan and possibly India.
In his Tuesday morning Twitter posts, Trump wrote that “Harley must know that they won’t be able to sell back into the U.S. without paying a big tax!”
It was unclear what he meant. He has threatened such a tax since the 2016 campaign, but he hasn’t imposed one, and Congress has blocked his efforts to craft such a tax. He could be referring to the tariffs he is attempting to unilaterally impose on imports.
It was also unclear what he was referring to in this post:
....We are getting other countries to reduce and eliminate tariffs and trade barriers that have been unfairly used for years against our farmers, workers and companies. We are opening up closed markets and expanding our footprint. They must play fair or they will pay tariffs!
— Donald J. Trump (@realDonaldTrump) June 26, 2018
In fact, Trump has tried to threaten numerous countries with tariffs if they do not reduce their own tariffs and other trade barriers, but so far most of those discussions have ended in acrimony and frustration. Numerous countries are moving forward with retaliatory tariffs against the United States, such as the ones European leaders have leveled at Harley-Davidson, to try to exert political pressure on Trump to back down.
Trump also suggested Tuesday morning that his adversarial approach to trade policy had only begun.
....We are finishing our study of Tariffs on cars from the E.U. in that they have long taken advantage of the U.S. in the form of Trade Barriers and Tariffs. In the end it will all even out - and it won’t take very long!
— Donald J. Trump (@realDonaldTrump) June 26, 2018
The completion of the study Trump cited could logistically provide him with a means to unilaterally impose tariffs on automobiles manufactured in Europe and shipped to the United States, potentially driving up the costs of cars made in Germany, for example. Trump has said he will follow through on these tariffs unless European leaders agree to remove tariffs they have on U.S. auto imports, but so far Europe’s leaders have mostly shown signs of meeting Trump’s tariffs with tariffs of their own.
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Damian Paletta is White House economic policy reporter for The Washington Post. Before joining The Post, he covered the White House for the Wall Street Journal.
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Last Updated:09:57 AM 06/26/2018
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