Trump’s tariff war takes a swipe at Harley-Davidson sales, profits

HARLEY-DAVIDSON is remaining positive about its future despite seeing sales slide around 6 per cent and profits swamped by ongoing trade disputes between the US government, Europe and China.

The company sold 69,000 motorbikes during Q2, representing a 5% drop on the period a year earlier and an overall drop of 6% to $1.4billion. 

The Milwaukee manufacturer became one of the unwitting highest-profile pawns in the tit-for-tat trade dispute that saw Trump raise tariffs for imports, prompting rounds of escalation that suddenly levied large overseas premiums on a number of US brands, with Harley-Davidson highlighted as one of the most severely affected in the economic tug-of-war. 

The Trump effect

Indeed, Harley-Davidson has faced trouble from multiple fronts over the last few months, including Trump himself who went as far as calling for a boycott on the brand when it declared it would be moving manufacturing overseas, ironically because of Trump’s tariffs that were crippling its business model.

However, slipping sales have been in evidence long before Trump got into office with Asia showing a greater demand for the iconic all-American product than at home or in Europe even before its progress was strangled by the aforementioned tariffs.

Harley-Davidson’s response to shift manufacturing to Thailand in an effort to avoid tariffs and capitalise on the overseas demand was then hit by delays in an approval process that verified whether such a move would be allowed to skirt the tariff issue.

What next for Harley-Davidson?

Despite the ominous forecasts, Harley-Davidson is more positive about the future with the approval process having now been rubber-stamped.

It is also forging ahead with plans to revive the brands fortunes with a new range of lightweight motorbikes targeted primarily at a growing Asian market, while the new zero emissions Live Wire – which will go on sale in the next few months - will see it become one of the first big firms to move into mainstream electric motorcycle production. 

Annual sales forecasts have dropped to between 212,000 – 217,000, a rounded down from 217,000 – 222,000 of April’s Q1 figure reveal.