Shares of Harley-Davidson took a hit on Thursday on speculation that it could be hurt by escalating trade tension between the U.S. and the European Union.
After the White House announced that it would remove exemptions from the 25% steel and 10% aluminum import tariffs for the EU, Canada and Mexico, the motorcycle maker said in a statement that the decision would “drive up costs for all products made with these raw materials.” Moreover, the European Union said on Thursday that it would retaliate, having previously listed Harley-Davidson motorcycles as a target for potential retaliatory tariffs.
The company said it was evaluating its options for managing anticipated price increases after the White House’s announcement, noting that a targeted retaliation on its products would have a “significant impact” on sales, dealers, suppliers and customers.
The company reiterated its desire for a quick resolution to the trade conflict.
In 2017, Harley-Davidson’s retail sales in Europe were second the United States, and accounted for nearly 42% of the company’s international sales. In the first quarter of 2018, Harley-Davidson cited Europe as an area where it experienced “strong results.”
As a result of speculation that it could be a casualty of escalating tension between the U.S. and the European Union, shares of Harley- Davidson tumbled Thursday.