Harley-Davidson CEO Matthew Levatich wrote a memo to dealers and employees Tuesday to address “misinformation” regarding the company and trade issues, saying the motorcycle maker shares the same trade objective as the Trump administration.
Continue Reading Below
Levatich said the iconic American company has invested in overseas production only so it has a “fighting chance” of competing with rival brands in high-tariff markets such as Europe, which sharply increased its import duty on U.S. motorcycles in June.
He also said Harley-Davidson doesn’t take sides in politics, but the Milwaukee-based company has found itself “in the center of a heated political conversation about fair trade,” according to a copy of the letter posted online by American Iron magazine. A Harley-Davidson spokesperson confirmed the memo’s authenticity.
“It is not our intention or our desire to be in this political spotlight, and the entirety of our effort and focus is to minimize any impact on this great brand, company, the business of our dealers and, critically, the passion and loyalty of our riders who we do everything for,” Levatich wrote.
“Our goal is the same as the U.S. Administration: we want a level playing field when it comes to trade, and we are working with government officials to find the best solution for our company and our brand.”
The letter didn’t directly address President Donald Trump’s recent support for potential boycotts targeting Harley-Davidson. In a tweet Sunday, Trump said it would be “great” if Harley-Davidson owners boycott the brand, continuing his criticism of the company following its announcement that it would shift some U.S. production overseas to avoid European tariffs.
In June, Harley-Davidson – by far the most popular brand in the domestic heavyweight motorcycle market – revealed that it plans to move production of bikes destined for the European market to factories outside the U.S. The move came after the EU hiked its tariff on Harley-Davidson’s U.S.-made bikes to 31 percent from 6 percent, part of the trading bloc’s retaliation for Trump’s tariffs on steel and aluminum.
Harley-Davidson operates overseas plants in Thailand, Brazil and India.
The company also said it would absorb any costs associated with tariffs, rather than passing on price increases to customers. Harley-Davidson expects tariff-related expenses to total as much as $100 million annually.
In his letter to employees and dealers, Levatich stressed that motorcycles for the U.S. market and most global regions will continue to be built in America.
“It is our clear preference to manufacture in the United States; it has been since 1903, and it remains so today,” he wrote. “The only reason we have invested otherwise is so that our products have a fighting chance of being price competitive in markets that burden our products with high tariffs.”
Harley-Davidson sold motorcycles in 103 countries in 2017, and 94 percent of those bikes were built at U.S. plants, according to Levatich.
He added that Harley-Davidson continues to work with government partners to “get these trade disputes resolved.”